IPEM: Russian power generating firms’ revenue shortfall 4 bln rbl

MOSCOW, Apr 21 (PRIME) -- The shortfall in revenue of Russian power generating companies in the three past non-working weeks reached 4.4 billion rubles with the thermal power plants accounting for the bulk of losses, the Institute of Natural Monopolies Research (IPEM) said in a research note late on Monday.

“The shortfall in revenue of generating companies in the three non-working weeks is estimated at 4.4 billion rubles, of which thermal power plants account for 4 billion rubles,” the institute said, adding that the shortfall is not fully compensated by a cut in fuel costs.

The coronavirus pandemic led to contraction of power consumption, which pushed the wholesale power prices for one day in advance down. The situation may become a stress test for the entire system of market relations in the power sector. The crisis again raises the problem of significant power reserves in the Unified Energy System of Russia and of many non-market segments of the wholesale power market.

In order to start working on the problem, the institute offers a new mechanism of paying for power for the plants, whose owners voluntarily switched them into a preservation mode.

“Under the mechanism offered by the IPEM, the facilities that went into preservation will pay for power at reduced rates. It would allow us to cut tariff pressure on the companies that are already operating in a regime of high risks, and should allow the power generation segment not to lose consumers in the long run,” the institute said quoting Alexander Grigoryev, head of the department for research in the fuel and energy complex.

(74.6657 rubles – U.S. $1)

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