By Shakeh AvoyanArmenia’s nuclear power station at Metsamor has asked a regulatory government body to nearly double the price of electricity supplied by it to the national power grid, its executive director Gagik Markosian told RFE/RL on Thursday.
The move followed similar requests by Armenia’s state-run water company and the Russian-controlled natural gas distributor.
Markosian said Metsamor’s management wants the State Commission on Regulation of Natural Monopolies, which has the exclusive authority to set utility and telephone charges in Armenia, to allow it to raise the tariff from 7 drams to 12.8 (2.3 U.S. cents) per kilowatt/hour. He argued that the plant, which generates about 40 percent of the country’s energy, needs additional funds to further boost it safety standards and pay for Russian nuclear fuel which he said will grow more expensive next year.
The chairman of the regulatory commission, Robert Nazarian, confirmed receipt of a Metsamor application containing documents that seek to justify the demanded price increase. Nazarian told RFE/RL that the commission will study and rule on them within the next three months.
Markosian claimed that the move is not directly connected with the recent takeover of Metsamor’s management by RAO Unified Energy System’s, Russia’s state-owned power utility. UES was given control of the plant’s finance in return for repaying its $40 million debts to Russian nuclear fuel suppliers. The Russian giant pledged to ensure timely fuel deliveries and improve Metsamor’s shaky financial position.
Of all Armenian energy producers, which also include hydro-electric and thermal plants, Metsamor has until now charged the lowest wholesale price for its electricity. Nevertheless, the Soviet-built facility is owed more than $130 million by the Hayenergo power grid -- a huge debt that has been accumulated since its reactivation in 1995.
An increase in Metsamor’s supply fees would not necessarily push up the retail price of electricity paid by ordinary consumers. At 25 drams per kilowatt/hour, it is one of the highest in the former Soviet Union.
Earlier this year, the Armenian government signaled its intention to raise the price starting from January. But President Robert Kocharian ruled out what would be a highly unpopular measure in a televised interview late last month.
It is unclear, however, whether Kocharian opposes tariff hikes sought by other utilities, notably the ArmRosGazprom operator that runs Armenia’s natural gas infrastructure. The authorities are under mounting pressure from ArmRosGazprom to raise the price of gas from $80 to $95 per thousand cubic meters.