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 Ukraine pledges introduction of recurring gas fee by late September, - memorandum with IMF

Ukraine undertakes by the end of September 2017 to ensure the split of a single tariff for gas in two - the cost of gas as commodity and the cost of gas transportation and distribution (a recurring fee) - by amending cabinet resolution No. 758.

Censor.NET reports referring to updated memorandum with IMF published by the Ministry of Finance.

According to the document, to facilitate the full liberalization of gas tariffs, a cabinet resolution on the monetization of assistance in the context of subsidies for reimbursement for housing and communal services at the level of utility companies will be passed by the end of August 2017. This will allow private gas traders compete with Naftohaz in supplying gas to households and utilities.

Moreover, by the end of September 2017, cabinet resolution No. 758 will be amended so that tariffs on gas transportation and distribution are separated from the gas cost as commodity.

Read more: Monthly recurring fee for gas to make 4.5 million consumers pay extra, social policy minister says

On March 28, NEURC (National Energy and Utilities Regulatory Commission) imposed tariffs on natural gas distribution as a payment for connection of private and industrial consumers to the supply system. The tariffs actually represent a recurring fee for connection to the gas supply system which is paid monthly based on the gas meter capacity regardless of the actual consumption. According to the commission, such a recurring fee applied to the most common type of meter (G4, 54 percent of the total number of customers and about 80 percent of the country's total consumption) will amount to about 92 hryvnia (up to $3.5) per month. President Poroshenko has demanded to cancel the decision to introduce the recurring gas fee.
 
 
 
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