Azerbaijan Economic Development Minister: Everybody Should Really Apprehend Recent Advance in Electric Power Tariffs
Heydar Babayev, Azerbaijan's Economic Development Ministry, has said today that everybody should really apprehend the recent advance in electric power tariffs, Trend reports referring to National AzTV Channel. The decision is the continuation of reforms being carried out in the economy and housing sector, said the Azerbaijani Minister.
According to him, the tariffs should be correctly counted and there was a need in their bringing to those which are in the international market.
SOCAR (State Oil Company of Azerbaijan) is the largest tax payer in the country. The recovery of the SOCAR financial activity and ensuring transparency in this field is of great importance to increase state revenues, and as a sequence - social expenditures, noted the Minister.
He said that at the same time, the advance in the electric power tariffs for the population was linked with the fact that the electric power generating and distributing companies should work according to market rules.
The State cannot shut its eyes to the permanent subsidizing and unprofitable activity of these enterprises. The increase in electric power tariffs is first of all linked with expenses on its generation. Mazut and gas are major components to generate electric energy. The price on gas bought from Russia has several times increased for the recent years. The increase in other components on generating electric power has lead to reducing the efficiency and increasing the state subsidizing that triggered making more radical decisions, said Mr. Babayev.
According to the Minister, the low cheap price on electric power leads to waste and dissipation.
All these factors in aggregate cause reducing the efficiency of both the generating and distributing networks, as well as increasing fuel consumption and different losses. Changing the tariffs was inevitable in this situation, stressed the Minister.
The recent decision made by the Azerbaijan Tariff Council was a serious call to investors. The Azerbaijani Economic Development Minister considers ambiguous evaluation the decision quite normal.
If the matter concerns poor stratus of the population, which receive low wages and live in poverty, the state, as usual, will successfully continue carrying out its social and economic policy and take serious steps to improve the living standards of these social groups, noted the Minister.
According to him, the wholesale electric power price at 0,142 manats per 1 KWatt/hour is a significant trouble to attracting investors. On the contrary, the existing prices will be very interesting to inventors. Reforms have never and nowhere apprehended ambiguously. We should raise the healthy non-oil sector at the expense of oil revenues. If we these oil returns spend to subsidies, then they will disappear and we shall find ourselves tied with foreign investments. The lack of carrying out of mutual calculation is one of the serious shortcomings in Azerbaijan. That mainly concern state-run companies. The decision by the Tariff Council will help in solving this issue, concluded the Minister.