Utility services may increase in price at least twice: discussions on new tariffs are ongoing
Despite the recent increase in electricity prices, utility tariffs in Ukraine remain significantly below market rates.
A memorandum with the International Monetary Fund states that utility prices need to be increased at least twice to improve economic sustainability in the energy sector.
According to the document, electricity tariffs cover only about 50% of the real cost, while the price of gas corresponds to about half of the actual costs. The IMF calls on Ukraine to develop a plan that takes into account the full reimbursement of utility costs, transparent tariff formation mechanisms, and a social protection system for vulnerable groups of the population.
The project also aims to improve the subsidy mechanism to identify households in need of assistance more accurately. Additionally, it is anticipated that the tariff increase will contribute to enhanced energy efficiency and increased competition in the energy services market.
Expert Comment
Oleg Popenko, the head of the Union of Consumers of Public Utilities, indicated on his Facebook page that the price increase will not be limited to electricity and gas.
The cost of energy resources is expected to increase, which, in turn, will lead to higher costs for other services, such as central heating, hot water, and water supply.
“We should expect that utility bills will increase at least twice. Given the constant reduction in subsidies, it may become much more difficult for Ukrainians to pay for utilities,” the expert noted.
It was previously reported that some Ukrainians would recalculate the cost of utility services, and the procedure for appealing the tariff increase was also considered. The law provides for conditions under which Ukrainians may not be required to pay for utilities in full. Despite the recent rise in electricity prices, utility tariffs in Ukraine remain significantly below market rates.
A memorandum with the International Monetary Fund states that utility prices need to be increased at least twice to improve economic sustainability in the energy sector.
According to the document, electricity tariffs cover only about 50% of the real cost, while the price of gas corresponds to about half of the actual costs. The IMF calls on Ukraine to develop a plan that takes into account the full reimbursement of utility costs, transparent tariff formation mechanisms, and a social protection system for vulnerable groups of the population.
The project also aims to improve the subsidy mechanism to identify households in need of assistance more accurately. Additionally, it is anticipated that the tariff increase will contribute to enhanced energy efficiency and increased competition in the energy services market.
Expert Comment
Oleg Popenko, the head of the Union of Consumers of Public Utilities, indicated on his Facebook page that the price increase will not be limited to electricity and gas.
The cost of energy resources is expected to increase, which, in turn, will lead to a rise in the price of other services, such as central heating, hot water, and water supply.
“We should expect that utility bills will increase at least twice. Given the constant reduction in subsidies, it may become much more difficult for Ukrainians to pay for utilities,” the expert noted.
It was previously reported that some Ukrainians would recalculate the cost of utility services, and the procedure for appealing the tariff increase was also considered. The law provides for conditions under which Ukrainians may not pay for utilities in full.
