VITALY KOROLEV: MODERNIZING FACILITIES IN THE ELECTRIC POWER INDUSTRY WILL NOT INCREASE TARIFFS

Deputy Head of FAS outlined the main directions of executing orders given by the President of Russia

Speaking at the Conference on “Modernizing heat generation: problems and prospects”. Deputy Head of FAS Vitaly Korolev emphasized that competitiveness of procedures, consumer opinions, equipment parameters, investors’ financial obligations, tariff regulation and the “tariff in exchange for efficiency” principle are the main line of work towards executing orders given by the President of the Russian Federation.

“Facilities subject to modernization must be identified under the frame of competitive procedures. In FAS view, only sought-after facilities can be modernized as well as those facilities that will increase efficiency in case of modernization”, pointed outVitaly Korolev.

Deputy Head of FAS also underlined the importance of localizing production.

“Modernization will take place for domestic equipment. This way we will support manufacturers in our country, maintaining the course towards import substitution”, said Vitaly Korolev. “Investors’ financial obligations should not be neglected. The quality of project implementation should be verified to make sure that the end results satisfy all parties on the electric power markets”. 

He mentioned that the trends on the heat supply markets also should be taken into consideration.

“It’s nobody’s secret that a lot of electric power generators also generate heat. Last year FAS introduced the “tariff in exchange for efficiency principle” in heat supply. Companies can keep the saved funds and spend them to enhance their efficiency. Here FAS jointly with the interested parties should prevent a situation when the saved funds can be excluded in tariff setting. Companies must be certain that such a situation is not going to happen, and have a full right to use these funds, spend them, in particular, for investments in the fixed assets”, reportedDeputy Head of FAS.

“The most important line of work: all relevant decisions should be made without raising the parameters set based on social-and-economic forecasting. When the tariff regulation powers were transferred to FAS in 2015, the annual tariff adjustment is a level below inflation. And the trend will maintain”, concluded Vitaly Korolev.