MOSCOW, Jul 3 (PRIME) -- Vladislav Solovyov, CEO of aluminum giant UC RUSAL, has suggested Economic Development Minister Maxim Oreshkin study a support program for large industrial power consumers that will stimulate industrial production and boost the gross domestic product (GDP), Vedomosti business daily reported on Monday.
According to Solovyov’s calculations, industrial consumers pay for excessive power generation, grid capacities, and many types of cross-subsidization with the payments amounting to 800–900 billion rubles a year. An increase of the cost of power by 1% cuts Russia’s GDP by 0.11–0.12% and raises inflation by 0.2–0.45% in annual terms, Solovyov said citing the data of the Russian Academy of Sciences and the National Research University Higher School of Economics.
Large industrial power consumers should be free from payments for renewable power sources and waste-to-energy facilities under capacity supply agreements. Power intensive productions launched from 2019 should also be free from the surcharge to power tariffs in Russia’s Far East during a five-year payback period, Vedomosti reported.
The business daily also said that Solovyov suggested elimination of cross-subsidization using the 222 billion rubles that are currently spent on capacity supply agreements and conventional power generation but will be non-existent after 2021. He also suggested prohibition of new cross-subsidization, increases of the existing measures, and creation of a plan to terminate cross-subsidization entirely in 10 years, Vedomosti reported.
An Economic Development Ministry representative told the business daily that the ministry received the letter and is studying the proposals. Alexandra Panina, chairwoman of the supervisory board of Council of Power Producers, said that RUSAL’s proposals are raw.
(59.3862 rubles – U.S. $1)
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