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NKREKP: Payment for gas transportation will not result in higher prices for individuals 

Kyiv, April 04, 2017.

The decision of the National Commission for State Regulation of Energy and Public Utilities (NKREKP) to introduce “monthly fees” for gas transportation will not result in higher gas prices for the population. The decision is aimed to separate prices for natural gas and the cost of its transportation by Ukraine’s gas transport systems. This was stated by Dmytro Vovk, head of the National Commission for State Regulation of Energy and Public Utilities, at a briefing held at Ukraine Crisis Media Center. “In the first stage this decision will lead to decreased bills for the majority of customers, for 15 million people. The bills for 30% of the population who only have gas stoves and central heating will not increase either, with the additional commission’s decision to reduce the cost of heating,” he noted.

The new methodology is based on capacities. Given that almost 90% of the tariff for heat is the price of gas that is regulated by the government, it is possible to reduce the cost for transportation and distribution for the 10% belonging to the competence of the commission. “Therefore, the total consumers’ bill for utilities, gas stove and gas transportation as well as heating bills will not increase,” explained Mr. Vovk.

On Monday, April 10, it is planned to consider suspending this decision and “amending certain NKREKP regulations in natural gas area in order to avoid increasing the total bill for the population.” “There will be an adaptation period so that citizens will know the size of the bill, look for ways to reduce it and gradually move to the system. Over the transitional period, the bills will not increase for any classes of households even including the cost of transportation. […] It will last at least three months. There will be no know-how or loading until the heating period,” assured Mr. Vovk. “The money consists of VAT that will go to the budget, the price of Ukrtransgaz transportation and the cost of transportation by distribution networks. Additional profits of oligarchs are out of the question,” he added.

The decision on a “monthly fee” was being prepared for two years. It follows from the law on the natural gas market.

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