5 Jul 2022 10:11

Planned investment in RusHydro facilities in Far East just a fifth of what is needed - Trutnev

KHABAROVSK. July 5 (Interfax) - The actual amount of investment needed in the modernization of RusHydro facilities in Russia's Far East is five times greater than the planned amount, Deputy Prime Minister Yury Trutnev, who is also the president's envoy to the Far East Federal District, said.

"RusHydro accounts for more than 90% of electricity generation in the Far East. The amount of investment needed for the modernization of these thermal power grids over the next ten years is estimated at 191 billion rubles. However, the current level of planned investment for this period amounts to 39 billion rubles, which is almost 80% less than what is needed," Trutnev said on Tuesday at a meeting in Khabarovsk with the secretary of the Security Council.

One of the main reasons for this situation is the "system of pricing developed by the Energy Ministry, which leads to an increase in the gap between the price of coal and the part of the cost factored into the rate," Trutnev said.

"While in 2021 the price of coal was 4,800 rubles per tonne, in 2022 it increased to 8,493 rubles per tonne. The growth essentially amounted to 74%. But rates for utility payments under the existing system cannot increase by more than 4% per year. The gap is growing, it is leading to losses. And losses for 2021 amounted to 5.2 billion rubles," he said.

However, this problem probably cannot and should not be solved simply by shifting the burden onto households, he added.

"That means we need to think about other possibilities. We need to look at possibilities within the context of, for example, the portion of RusHydro payments that the company transfers to the government [of Russia] as the shareholder, or work out a subsidy mechanism," Trutnev said.

"But just increasing the gap between actual expenses and compensated expenses will lead to the deterioration of the financial position of the company, which is vital for regions of the Far East," Trutnev said.

The Far East has a high rate of depreciation in its thermal power grids, amounting to 77-95% in some regions, he said. The highest depreciation figures are in Yakutia, Transbaikal Territory, Primorye and Magadan Region.