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The IMF advised Ukraine not to control gas prices for households. Photo: pixabay.com
The IMF called the return of control over natural gas prices an ineffective way to subsidize households. Such a step could lead to the abuse of resources due to corruption and slow down the implementation of energy efficiency, said the head of the IMF in Ukraine, Josta Lyngman.
He spoke about this in an interview with “Interfax-Ukraine”.
“There is, and will continue to be, a significant part of the Ukrainian population who cannot cover the costs of gas, heating, hot water and electricity. The most effective way to help these households is to identify them and provide them financial support through of the budget so they can pay their own utility bills, “Lyngman said.
According to him, this support tool exists in the form of a household subsidy program and is supported by the IMF.
He added that another question is structural: what is the most efficient way to organize the gas market.
“Since 2015, a comprehensive effort has been made to move towards an open and competitive gas market at both the wholesale and retail level. Significant progress has been made, but a fully functional national gas market has not yet been established. fixed price is one of many necessary measures, ”said Lyngman.
Speaking about the electricity sector, the head of the bureau noted that financial imbalances in it are cause for concern, but suggested dividing this problem in two: the current financial imbalance and Ukraine’s long-term energy security.
According to him, there is an urgent need to identify additional financial resources for the electricity sector.
“An important part of this is mobilizing real income streams. Simply borrowing is no longer a viable solution to the current imbalance,” Lyngman said.
He added that there is a broader problem of the long-term electricity model in Ukraine, as Ukraine now uses outdated power generation infrastructure, much of which is a legacy from Soviet times.
“The reorientation and modernization of electricity production is necessary and possible. But this requires planning to improve energy supply and energy security in Ukraine,” said the head of the IMF office.
Recall that after the increase in gas prices for the population since the beginning of the year and the massive protests of the population on this issue, the Ukrainian government set the maximum gas price for February-March 2020 at 6.99 UAH / meter cubic. m for the population.
On March 25, it became known that Naftogaz Ukrainy set the price of gas for domestic consumers in April at 6.86 UAH per cubic meter.
