Energy ministry plans to raise electricity tariff for households

Newly appointed acting Energy Minister Yuriy Boyko says one of the important issues in the sector is the revision of the existing cross-subsidization mechanism from 2021, according to which households get electricity at a reduced price.

"The next priority is to reduce cross-subsidization. Behind this phrase is the objective need to revise the approaches to the formation of tariffs for households. Since today, including in the media, there is a large number of manipulative statements about the final cost of electricity for the population," Boyko said during his first briefing after the appointment, an UNIAN correspondent reports.

Read alsoNaftogaz reports billions in losses over low gas pricesAccording to the official, as of November, a household consumer pays one kopiyka for electricity, since the current tariff covers only transportation costs. In Ukraine, the weighted average cost of transporting electricity from the station to the building, including the transmission tariff of the National Power Company Ukrenergo, the tariff of the distribution system operator and the tariff for the supply from the supplier, is UAH 1.03 per kWh.

"So, in total, delivery costs UAH 1.03, while the weighted average price of one kWh for a household consumer for the last two months has statistically amounted to UAH 1.04. That is, in fact, within the framework of the current PSO [Public Service Obligation] model, according to which State Enterprise NNEGC Energoatom and the state-owned energy generating company Ukrhydroenergo sell electricity for the Guaranteed Buyer at one kopiyka, only delivery is paid," Boyko said.

Electricity tariff for Ukrainians

In Ukraine, the price of electricity for households has remained unchanged since 2017, amounting to 90 kopiykas per 1 kWh with a consumption of up to 100 kWh, and UAH 1.68 per kWh over 100 kWh.

At the same time, for industrial consumers, electricity prices are formed on the basis of market mechanisms and range from UAH 2.5 to UAH 4 per kWh.

Reshuffle at Energy Ministry

On November 20, 2020, the Cabinet of Ministers dismissed Acting Energy Minister Olha Buslavets. Deputy Energy Minister Yuriy Boyko was appointed to replace her.