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IMF demands from Ukraine’s authorities to increase gas prices for population

Source : 112 Ukraine

Another issue is a structure one – the most effective way to organize the gas market
16:20, 30 March 2021

Price of natural gas for the population
Open source

The International Monetary Fund (IMF) called ineffective the subsidizing of households and return to control over the prices for natural gas. Such a step might lead to the excessive use of resources due to the corruption and curb of implementation of energy efficiency, as Interfax-Ukraine reported citing IMF Resident Representative for Ukraine Goesta Ljungman.

“Significant part of Ukrainian population exists and will exist that cannot cover expenses for gas, heating, hot water and electricity. The most effective way to support these households is to identify them and provide them with the financial support through the budget to allow them to pay for their own utility bills,” Ljungman said.

Related: Duties and gas transit issues for Ukraine: Trump's policy more beneficial than Biden's?

According to him, this support tool exists in the form of a subsidy program for households and it is supported by the IMF.

He added that another issue is a structure one – the most effective way to organize the gas market.

“Since 2015, the complex efforts are held for transition to open and competitive gas market at wholesale and retail levels. Significant progress is achieved but a thoroughly functional market of the gas is not created yet. The provision to the households of the choice between broad ranges of products, including contracts with a fixed price is one of the many necessary measures,” Ljungman said.

Related: European Court of Justice may decide to restrict pumping of gas bypassing Ukraine

As we reported, the National Commission for State Regulation of Energy and Utilities (NCRECP) of Ukraine canceled the night tariff and life-line tariffs for electricity.

Another canceled document established the tariffs for electricity for population and provided life-line tariffs in the sum of 0.9 hryvnia/kW ($0.032) for the first 3,000 kW in a month for domestic consumers who use electricity for house heating.

On January 1, 2021, the reduced tariffs were canceled in Ukraine for electricity for the population. The first 100 kW cost 1.68 hryvnia ($0.060). Earlier, people paid 90 kopiyka per month ($0.032) and each next kW costs 1.68 hryvnia ($0.060).

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