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Ukrainian Prime Minister Volodymyr Groysman states that the "Rotterdam plus delivery" formula, which is determined at trading on the Rotterdam stock exchange (the Netherlands), plus the cost of coal transportation to the domestic market, has never been used to calculate the price of coal in Ukraine.
"According to the Energy and Coal Industry Ministry, the 'Rotterdam plus' formula has never been used to calculate the price of coal in Ukraine. In fact, it has not been applied despite a fuss about it," the prime minister told a briefing on October 26.
He also noted that it is an independent commission rather than the government that establishes the formula. As for the price of gas, which is regulated by the government, there are no grounds for its raising.
"There is no reason for an increase in [households'] tariffs. It is the local authorities' responsibility to optimize their expenses so that people do not pay more," he stressed.
Groysman also pledged that the budget has enough funds for subsidies.
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According to the head of NEURC, Dmytro Vovk, the marginal price for coal began to be formed based on the price (API 2 index), which is determined at trading on the Rotterdam stock exchange (the Netherlands), plus the cost of coal transportation to the domestic market (the so-called "Rotterdam plus delivery" formula). According to NEURC, the method of calculation should eliminate manual regulation of prices, ensure independence from supplies from occupied areas in Donbas, address problems related to the accumulation of sufficient coal stocks for the heating season.
At the same time, Groysman has repeatedly demanded that the authorities determine the expediency of the use of the formula. In the middle of January 2017, the Minister of Energy and Coal Industry, Ihor Nasalyk, said that the use of the "Rotterdam plus delivery" pricing formula for energy coal did not solve the problem of coal supply diversification.