Government • 14 November, 2018

Meeting on tariffs in Zhambyl region: affiliated companies to be checked for legitimacy of overpricing

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One of the main goals of the Prime Minister’s working trip to Zhambyl region is to discuss with the monopolists and utility companies of the region issues of tariff policy transparency and to consider measures to reduce costs as part of the execution of Head of State’s instructions given at the Security Council meeting, reports Prime-Minister`s press service.

At the meeting, the issues of transparency in tariff setting and reduction of costs for electricity and heat, water and gas, sewage, telephone and Internet services were raised.

Sagintayev noted that in order to implement the task set by the President to reduce tariffs for users, the Government began the relevant work: these are institutional, systemic changes and operational measures that need to be implemented as soon as possible.

The development of amendments to legislation to strengthen state control over the targeted use of natural monopolists and strengthen anti-monopoly activity has begun. In the Mazhilis of Parliament there is a new bill “On Natural Monopolies.” The draft law provides for the creation of a number of institutions that will make the tariff more transparent and involve the population in the process of tariff formation.

In turn, the heads of local executive bodies and utilities located in the regions need to ensure transparency of the tariff formation process at their level and strengthen control over pricing in the energy services market, as well as promptly take all necessary measures to reduce tariffs.

Chairman of the Antimonopoly Committee of the Ministry of National Economy A. Maytiev reported on the measures taken. According to him, under the instructions of the Head of State outlined in the Address to the people of Kazakhstan and at the Security Council meeting, the committee is implementing a number of measures. In particular, tariffs for heat supply services by 10 monopolists were reduced to 4.4 billion tenge. In particular, in the Zhambyl region two monopolists reduced tariffs for 122 million tenge. Along with this, public receptions for working with the public on the quality of housing and public utilities have been opened throughout the country. In the event of complaints about the actions of monopolists, respectively, unscheduled inspections in the field of housing and communal services will be opened.

During the meeting, presentations were made by managers of utilities enterprises in Zhambyl region on utility rates. Head of Territorial Department Committee for the Regulation of Natural Monopolies, Protection of Competition and Consumer Rights of the Ministry of National Economy E. Duisembiyev made a report. Based on the results of the past heating season, the cost of heat supply services were recalculated taking into account the actual outdoor temperature in the 2017–2018 heating period, and 31.726 million tenge in eight natural monopoly entities were returned to customers in Zhambyl region.

Head of Taraz Su LLP M. Smailov reported on water supply tariffs for consumers in the Zhambyl region. It should be noted that the company has reduced tariffs by 20%, that is, if the average selling tariff was operating within 81 tenge, now within 65 tenge.

General Director of JSC Baturov Zhambyl Regional Power Plant V.Melezhik reported that the established marginal tariff for electricity supply is 9.47 tg / kW · h. In previous periods, the main component of costs in the structure of the tariff was fuel, which is in the range of 82-84%. The reduction of the marginal tariff for electricity generated, according to him, is possible only in the case of a decrease in the cost of the main type of fuel — marketable gas.

Director of the Zhambyl branch of KazTransGazAimak JSC S. Ismailov, in turn, reported that gas is supplied via the Beineu-Bozoy-Shymkent main line. Today, out of 377 settlements in the region, 181 are provided with gas. More than 185,000 subscribers of private and communal apartments, 319 industrial, 5,000 utilities enterprises are supplied with commercial gas. The total length of the distribution pipeline in the region is 4,600 km.

General Director of Zhambyl Electric Networks LLP A. Zhorbolov reported that the main activity is transmission and distribution of electric power and operation of electric networks and transformer substations. One of the ways to solve the problem of worn-out networks is to include an investment component in the tariff. So, for 2011–2018 the actual volume of investment in the company amounted to 5.9 billion tenge.

Having heard the reports of regional subjects of natural monopolies, the Prime Minister noted that entrepreneurs from the region are receiving complaints about high prices for the connection service.

According to the information of business representatives, about 80,000 houses cannot connect to a gas pipeline passing by, since the cost of the service is 200-500 thousand tenge. The reason, according to business representatives, is in the construction designers who set prices that are several times higher than the market value. Due to the lack of access by other companies to connecting services, the allegedly "affiliated" companies have their own requirements that do not reflect the real cost of the services provided.

In this regard, Bakytzhan Sagintayev asked the regional prosecutor, and also instructed the tax inspection and economic investigation services of the State Revenue Committee of the Ministry of Finance to check all companies that are affiliated, have licenses and deal with commercial gas for pricing in one week.

In order to familiarize himself with the quality of public services rendered, the Prime Minister also visited the Taraz-SU enterprise. The water supply system of the city of Taraz is being upgraded here — the construction of a building has begun, which can take up to 100,000 cubic meters of water per day. For these purposes 35 million tenge was allocated from the regional budget. In addition, work is underway to create a single operator for the supply of drinking water in the Zhambyl region on the basis of the enterprise. It should be noted that the sewage rates for drinking water in Taraz are the lowest in Kazakhstan.

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