Russia aims for progress on power grid hookups to improve business climate
MOSCOW. July 6 (Interfax) - Russia's Cabinet has ordered government agencies to make rapid progress on eliminating barriers to power grid hookups for businesses. The accessibility of grid connections is currently one of the indicators that is spoiling Russia's overall performance in the International Finance Corporation's Doing Business ranking, which the authorities have selected as a measure of the success of their efforts to improve the business climate in the country.
This problem has not escaped the attention of the authorities in the past. For example, some of Viktor Zubkov's harshest criticism during his tenure as prime minister concerned this issue: at a cabinet meeting in March 2008, he said that former UES chief executive Anatoly "Chubais and all these organizations have become completely brazen."
Years of work in this direction, based on the Doing Business indicators, has had little impact. In last year's ranking of 183 countries, Russia was in last place in terms of the time and cost of connections to grids, and ranked 120th overall.
Now specific KPI have been set for agencies responsible for this issue. The road map for the project to increase the accessibility of power infrastructure that Prime Minister Dmitry Medvedev approved on June 30 calls for Russia to move up in the Doing Business ranking to 60th place by this indicator in 2015 and to 20th place by 2018.
There are plans to make the process of connection simpler, faster, more transparent and less costly by reducing the steps involved (from 10 in 2012 to five in 2018); reducing the amount of time it takes to complete all the steps (from 281 to 40 days); and reducing the cost of hookups to grids (from 1,852% to 25% of per capita GDP).
In order to simplify the process, there are plans to introduce a notification procedure in September for access for consumers of capacity of up to kVA and voltage up to 10 kV, inclusive. Consumers of capacity of 15-150 kW will be allowed to spread payments over three years.
Also in the fall there are plans to begin gradually lowering the price of technical hookups for consumers with compensation of the costs of grid companies. There are plans to develop common standards for disclosure of information on applications for technical connections by 2013.
In November 2012-March 2013, the government plans to develop mechanisms for accelerating connections under temporary arrangements, and set rates for temporary connections.
By March, there are plans to collect the latest data on maximum connected capacity of consumers, develop a system for tracking capacity and rules for disclosing information on it, as well as improve the rules for redistribution of capacity and determine the size of the market. By June, the government plans to create an Internet resource to enable consumers to place orders to receive capacity.
The heads of the federal agencies responsible for implementing the plan - the Energy Ministry, Federal Anti-Monopoly Service, Federal Tariff Service and others - have been ordered to submit quarterly progress reports to the Economic Development Ministry.
The Economic Development Ministry will be responsible for monitoring and controlling the implementation of measures and will submit quarterly reports to the government.
