Ministry proposes merging System Operator into Russian Grids
MOSCOW. Oct 4 (Interfax) - The Economic Development Ministry is proposing to merge OJSC System Operator into Russian Grids .
This is one of the proposals in a plan to curb prices for the products and services of infrastructure monopolies while maintaining their financial stability and investment appeal that the ministry has submitted to the government.
An official at the Energy Ministry told Interfax that the ministry reviewed the Economic Development Ministry's proposals and submitted its objections.
The issues that the Energy Ministry finds contentious include a proposed review of the parameters of capacity supply agreements for thermal, hydro and nuclear power generation, as well as proposals to transfer the role of supplier of last resort to Russian Grids and to merge System Operator into Russian Grids.
The Economic Development Ministry did not factor the Energy Ministry's objections into its proposals to the government. The Energy Ministry official said the ministry has drafted a letter to First Deputy Prime Minister Igor Shuvalov expressing its "fundamental disagreement on certain provisions of the plan." The letter is waiting to be signed by Energy Minister Alexander Novak.
A market source told Interfax that the proposal to merge System Operator in Russian Grids is also included in letter the grid company's chief executive, Oleg Budargin sent to the Energy Ministry "on the same day as the Economic Development Ministry proposals."
Another source said this proposal is aimed at reducing administrative costs. Russian Grids is not commenting on Budargin's letter to the Energy Ministry.
A source at the Economic Development Ministry told Interfax that the discussion within the government will continue next week.
System Operator told Interfax that combining the roles of operational dispatch management and operation of power grids in one organization creates the risk that technical and management decisions that worsen the economic operating conditions for generating companies and consumers will be made and implemented through the system of operational dispatch management.
This refers to conducting repairs to power grid infrastructure while refusing or postponing repairs to generating equipment, loading/unloading of generating facilities to ensure the required operating parameters for power transmission lines and power grid equipment, reducing electricity losses in power grids, and so on.