THE MOUNTING GAS PRICES TO INFLUENCE THE TARIFFS
Vasak Tarposhyan

Hayots Ashkhar Daily
26 Sep 2008
Armenia

As you know from April of the coming year the prices of the gas
supplied from Russia will raise, from 110 to 154 dollars. How will
this fact influence the internal tariffs of gas and electricity? The
vice-Chairman of the Committee Regulating Public Services Nikolay
Grigoryan answers the questions of "Hayots Ashkharh" daily.

"If the prices of the imported gas raises from 110 to 154 dollars
naturally it will have impact on the final tariffs of gas, which will
definitely influence the inhabitants and all the other consumers.

At the moment I don’t want to give any number, because the prices
will be clear only after certain calculations. But we must take
into account that while reviewing the tariffs lots of factors are
considered. As we know there are lots of expenses, which should also
be taken into account.

The tariff doesn’t depend only on gas, so we shouldn’t observe only
that factor. There are certain investment programs, which we have
already approved and we can’t overlook them. During the calculation
of the tariffs we will take all this into account. So the tariffs
will also raise but I can’t say to what extent."

"What is the impact of all that?"

"From 110 becomes 154 dollars, which means 4 0%. Though if we compare
with other countries our situation is better. In such circumstances
the average rhythmical tariff will be much higher."

"Anyway will the increase be essential or not?"

‘What do you mean by saying essential? For some people one dram is
also essential. For some cases it is essential for some it is not. So
I can’t give any assessment. "ArmRusGasIndustry" must first of all
place an order to the Committee Regulating Public Services. Most
probably the increase of gas prices will not have essential impact
on the final tariffs."

"Taking into account the fact that after the calculation of the working
tariff dram has become stronger, what influence can this fact have
on the formation of the new tariffs?"

"Most probably taking into account that fact it is announced that the
increase of gas prices won’t have any essential impact on the final
tariffs. But before the order is placed we can’t tell you what will
be the role of that factor."

"The gas price imported in 2007 was 40 thousand dram. After the
increase of prices it becomes 46 thousand dram. Is it an essential
impact on the internal tariffs?"

"Of course no, if we take into account the processes taking place
in the world gas market. But in order to assess its influence on the
internal tariffs we must take into account=2 0many other factors as
well, their role on the formation of final tariffs."

"Are you going to maintain the differentiated approach of the gas
prices for the inhabitants and big consumers?"

"Frankly there are different approaches in the committee regarding that
issue. Certain changes are not excluded because today the deference
in the gas tariffs between those who use 10 thousand square meters
and more gas is very big. So certain activities are in process in
that regard. In my view it must be changed but I don’t know when."

"In your view is it justified that the inhabitant-subscribers pay
two times more for gas than the big consumers?"

"It is not accidental. The expense of the gas-supplier is much more
in case of the inhabitants. The gas supply to the small consumers is
much more expensive. This is the problem."

"Will the increase of the imported gas influence the tariffs of
electricity?"

"Of course. If we take into account the fact that 30% of our
electricity is produced in the Electric Stations of Hrazdan and
Yerevan and they work by gas."