The Federation of Employers of Ukraine (FEU) firmly opposes the proposed increases in electricity transmission and dispatching tariffs by the National Commission for State Regulation in the Energy and Utilities Sector (NERC).
According to a statement, FEU has sent official objections to NERC, NEC "Ukrenergo," the Ministry of Economy, and the Ministry of Energy, outlining its position and proposing a compromise solution that involves optimizing the tariff structure for these services.
The statement reminds that on November 13, NERC approved a draft tariff for electricity transmission services at the level of 665.27 UAH/MWh, which represents a 26% increase. Additionally, the tariff for dispatch (operational and technological) management has been set to 95.07 UAH/MWh. FEU considers such increases unacceptable and dangerous for the country's economy.
"The increase in these tariffs adds extra pressure on Ukrainian enterprises, which, in the context of war, could lead to catastrophic consequences. For instance, if only the tariff for electricity transmission services is raised, energy costs will increase by over 13 billion UAH, thereby reducing the competitiveness of products," the statement emphasizes.
Moreover, it is noted that the situation is further complicated by the fact that many Ukrainian enterprises are suffering significant losses due to the destruction of infrastructure and production capacities. An increase in tariffs will lead to a decline in production, negatively impacting currency and tax revenues amid a budget deficit.
As pointed out by FEU, some costs included in the tariff projects are excessive. For example, the draft dispatching tariff includes auxiliary service costs amounting to 11.4 billion UAH, while an analysis of data for 2024 indicates that actual expenses are significantly lower. Over the nine months of 2024, only 2.6 billion UAH was spent on dispatching, and just 67 million UAH on the purchase of replacement reserves. Given the rising electricity prices and the lack of need for subsidies for gas units, these costs could be significantly reduced.
FEU proposes to optimize the tariff structure for 2025, specifically setting the tariff for electricity transmission services at no more than 530 UAH/MWh and the dispatching tariff at no more than 60 UAH/MWh.
FEU emphasizes the need to consider economic realities and ensure stability in the energy sector, as rising tariffs in these challenging times could become an unbearable burden for the manufacturing business and significantly worsen the socio-economic situation in the country, the statement concludes.