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Preventing a utility shut-off: Ukraine's new rules

Author : Olena Holubeva

Source : 112 Ukraine

Last week, President Volodymyr Zelensky signed a law giving the green light to disconnect debtors for communal services from numerous services
19:50, 6 September 2021

Open source

Last week, President Volodymyr Zelensky signed a law giving the green light to disconnect debtors for communal services from services: electricity, gas, heat, and water. In this regard, utility providers are massively preparing to return what the population owes them, taking the quarantine amnesty as an opportunity to take a break from the communal stranglehold.

According to the current legislation, suppliers can disconnect people from gas by cutting off pipes in the ground, block access to electricity and water, and even block sewers in apartments. From September this will happen en masse throughout Ukraine. Indeed, after the entry into force of the norms of the document signed by Zelensky, it is allowed to disconnect consumers from utilities of housing and communal services in all territories where the red level of epidemiological danger has not been established. And these are the majority.

Related: Why Ukrainians shouldn't trust authorities' hyped promises about reducing utility tariffs

Who will be cut off from gas?

The total debt of the population for housing and communal services at the end of June exceeded 2 billion USD. Consumer debt for gas and gas delivery service has grown to almost 1 billion USD, Deputy Head of the Board of the Association of Energy Suppliers Yevgeny Natsvin-Stepanov told.

According to him, a critical situation with payment for housing and communal services in general (including gas) developed last year. In connection with the quarantine, the authorities announced a "communal amnesty", allowing the population not to pay for services. Many took advantage of this situation.

"The population increased the debt for 2020 by more than 0,5 billion USD. The level of payment has dropped critically since October. Then about 60% of payments from charges were received from consumers. the indicator fell to 40%, and in December it recovered to 70%. In January and February of this year, the population accumulated debts, and since March they began to pay off them little by little," Natsvin-Stepanov said.

According to the Association of Energy Suppliers, on average in Ukraine, about 15-25% of consumers (the figures for different suppliers vary in this range) do not pay for gas for four or more months. A considerable number of consumers basically do not pay for the second payment - for gas transportation. They often argue that "we laid these pipes ourselves," that is, we paid for the gasification of our street. For gas workers, this is not an argument. They believe that consumers should pay for the maintenance and repair of the network and adjacent sections, which is carried out by the regional gas company (employs specialists and emergency teams in full readiness). In addition, the regional gas maintains the pressure in the pipe, for which gas is purchased for production and technical needs. According to the State Statistics Committee, as of the end of June, the total debt for the supply and distribution of gas in Ukraine reached 1 billion USD.

Related: Odesa protests against increase of prices for housing and utilities services

After monetization, payments for gas consumed by subsidies, who keep the money for themselves, instead of paying for a communal apartment, worsened.

Not only malicious deviators do not pay for housing and communal services, but also people who were fired from their jobs due to quarantine found themselves in a difficult financial situation, as well as pensioners, low-income families, and large families, which For some reason, they could not achieve the right to receive a subsidy or were deprived of it as part of the course to reduce the costs of supporting vulnerable categories of the population, adopted by the Ministry of Social Policy last year.

It is noteworthy that, according to the legislation, the basis for disconnecting consumers from the gas can be not only overdue debt but also the consumer's refusal to install a gas meter, which is carried out on the initiative and at the expense of the GDS operator (in accordance with the requirements of the Law on Commercial Metering of Natural Gas). Meters are, in fact, the only way for regional gas companies to reduce losses in networks and plan consumption and gas volumes to maintain pressure in pipes. Homes without a meter pay according to the rates. They are established by a resolution of the Cabinet.

Related: Most searches in Kyiv do not concern utility companies, departments of city administration

For several years, litigation has been going on in this area: gas workers insist on increasing consumption rates so that the population itself is interested in installing meters. The fact is that the gas rates that are set for consumption on a gas stove, water heater, are set per person, registered in the household, but in fact many more people can live in it (or it can even be a rented apartment). Thus, the real gas consumption increases significantly.

Regional gas companies assure that no one disconnects consumers for 10 USD of debt. Such measures are applied when the debt exceeds at least 200 USD.

The debtor is notified of the upcoming shutdown in all possible ways: they send notifications, write SMS. According to the norms of the corresponding Code, gas workers must warn the consumer about the shutdown at least three days before the scheduled date of gas supply interruption. According to Chapter 7, Section VI of the Code, the gas supply to domestic consumers is cut off by shutting off the shut-off devices or installing an inventory plug and sealing it, the press service of Naftogaz said.

If a consumer interferes with the work of gas workers or simply does not allow them to enter the territory of the household, he can be cut off from the pipe "in the ground" by mechanically disconnecting the consumer's gas network from the gas distribution network of the operator. In this case, taking into account the land work, connecting back to the gas networks will cost at least five times more than when the household was closed on the inner pipe. Gas supply is resumed by the operator of the GDS (regional gas) upon a written request from the consumer "after full payment of the debt and reimbursement to the operator of costs for the suspension and resumption of gas supply," Naftogaz said.

Gas workers advise not to bring the matter to a shutdown, but to contact the service center after the first notifications, deal with debt, and seek restructuring.

For example, Kharkivsbyt has already signed restructuring agreements with 2,500 clients. In 2021, Kirovohradoblgaz signed 82 agreements on debt restructuring for gas distribution services in the Kirovograd region.

Related: National Security and Defense Council to consider economic downturn due to rising utility tariffs

The heat workers have their hands tied

If for gas workers, disconnecting consumers has always been a common thing and a way to get payment for gas and its delivery, then the situation is different for thermal workers. It is impossible to cut off one apartment from heat consumption in an apartment building. In houses with vertical heat distribution, this is completely unrealistic: you can only turn off the whole house. In houses with horizontal wiring (new buildings since 2006), this is, in principle, possible, but it can disrupt the heat balance of the whole house. By the way, this is also related to the fact that consumers in apartments without a heat meter, leaving even for several years, have to pay not only for the heat accounted for in the apartment according to the norms but also for heating the non-residential premises of the house. And nothing can be done about it.

The press service of Kyivteploenergo said that "taking into account the technical features," the procedure for disconnecting a separate apartment from heating and hot water supply services is very complicated and can only be used as an extreme measure of influence on the debtor."

The total debt of Kyiv residents to Kyivteploenergo as of August 1, 2021, is 168 million USD. Moreover, as you know, in July-August, after the recommendations of the Antimonopoly Committee were applied, additional debts "retroactively" were charged to residents of 1,300 houses in Kyiv. In general, in Ukraine, according to the State Statistics Committee, as of the end of June, the debt for the supply of heat and hot water reaches 0,8 billion USD.

Due to the cancellation of PSO for CHP enterprises and the rise in prices for natural gas, which occupies up to 80% in the heat tariff structure, a significant increase in heat tariffs is planned throughout Ukraine in the current heating season. In particular, Kyivteploenergo may increase the tariff by 30-40%.

In this case, the size of the population's debt will increase as expected. But it is not worth rejoicing in the fact that thermal workers cannot cut off the supply of services and will seek to pay debts through the courts. It is possible that the Verkhovna Rada will soon return to approving the initiatives that were considered last year. They want to equate debtors for housing and communal services with malicious defaulters of alimony. They are offered not to be allowed abroad, to be deprived of their driver's license, and also to confiscate half of their salary. If the legislative initiative is approved, debtors for heat and hot water will be fully "tightened".

Mass disconnection of the debtors

Electricity suppliers intend to apply the norm, allowed after the signature of the president, and massively disconnect debtors for non-payment. Unlike thermal engineers, they, like gas workers, have no technical barriers to this.

Kyiv electricity supplier Yasno urges consumers to pay electricity bills by the 20th day of each month. Zakarpattyaenergosbyt promised to initiate disconnection of debtor consumers from electricity/gas supply. Similar warnings were posted on their websites by Cherkasyenergosbyt and Kharkivenergosbyt.

According to the State Statistics Committee, at the end of June, the debt of Ukrainians for the supply and distribution of electricity amounted to 263 million USD.

Electricians say that in case of accumulation of debt, a warning is sent to the consumer's mail 10 days before the shutdown date. Thus, there is time to contact the service center and conclude an agreement on debt restructuring. This is at the discretion of the supplier and each case is considered on a case-by-case basis. Suppliers advise "not to wait for people with wire cutters to come." The direct disconnection is carried out by oblenergo (transmission system operator). Moreover, if the consumer has an automated system for commercial metering of electricity ASKOE, then it is turned off remotely.

Related: Switzerland allocates $1.5 million for water utility in Donbas

Water utility services will cut off water and sewage systems to debtors

Water utility services also intend to resume the practice of limiting water disposal in apartments and households of debtors. In particular, 112ua.tv reported this in the press service of Kyivvodokanal.

"Restriction of drainage in apartments of debtors will be carried out after systematic work on informing about the presence of debt and ways to repay it, as well as in case of the debtor's unwillingness to pay off or restructure the debt," the press service of Kyivvodokanal said, specifying that it is about debts more than 750 USD.

This amount is the threshold after which the water utility's patience can burst.

Again, unlike thermal workers, water utilities may well punish one or more apartments of debtors in a house by blocking the sewer system.

Related: Would utility checks increase in Ukraine?

In the near future, it may increase even more due to the increase in tariffs. As you know, Kyivvodokanal has been seeking to raise it for several years, but the decision is still blocked at the level of NEURC. In general, in Ukraine, according to the State Statistics Committee, the debt for water supply and sanitation services reaches 240 million USD. As reported, in the event of tightening requirements for drinking water, tariffs may rise significantly, and, consequently, debt will grow.

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