Armenia’s PSRC head says prices for natural gas and electricity likely to rise next year
YEREVAN, December 2. /ARKA/. In an interview with Armenia’s Public Television, Garegin Baghramyan, the chairman of Armenia’s Public Services Regulatory Commission (PSRC), said prices for natural gas and electricity are likely to rise next year, saying also that the final figures will be known in 10-15 days.
He said Armenia’s Ministry of Territorial Administration and Infrastructure Development, which is in charge of the energy sector is holding comprehensive talks with the Russian energy holding Gazprom, the major supplier of natural gas to Armenia through Georgia.
He said the talks also cover the property owned by Gazprom-Armenia, a subsidiary of Gazprom, including the 5th power unit of Hrazdan TPP. In his words, Gazprom Armenia has not received any profit yet from the power plant since its acquisition. According to him, the draft interstate agreement under discussion stipulates 9% profitability for Gazprom from the 5th power unit of the Hrazdan Thermal Power Plant.
"The price for Russian natural gas at the border, the amount of investment in Armenia's gas supply sector in the next 30 years, and the cost of electricity directly depend on the final comprehensive decision," Baghramyan said.
He reminded that Armenia has started repaying the Russian interstate loan taken by the government to extend the operation of the Armenian NPP, which also implies some burden on the electricity tariff for the residents of the country. "Depending on the decisions made, the electricity tariff may rise," Baghramyan said.
Gazprom-Armenia acquired the 5th power unit of Hrazdan Thermal Power Plant in 2006. Gazprom-Armenia is said to have invested as many as $465.2 million to complete its construction and modernization.
The Armenian Nuclear Power Plant is located some 30 kilometers west of Yerevan. It was built in the 1970s but was closed following a devastating earthquake in 1988. One of its two VVER 440-V230 light-water reactors was reactivated in 1995.
In March 2014, Armenian government decided to extend the plant’s service life up to 2026 because of delay in building a new unit. The service life extension has become possible thanks to Russia’s financial resources. The country provided $270 million to Armenia as a loan and $30 million as a grant.
The Russian natural gas is delivered to Armenia by Gazprom at a $165 per one thousand cubic meters, but Gazprom’s Armenian subsidiary - Gazprom Armenia - sells it to the bulk of Armenian households at almost $300. Gazprom Armenia also deals with the storage, distribution and sale of gas. -0-
