Develop the model and the regulations on elimination of cross-subsidies in energy tariffs (electricity) (CWP.03.BY)

Objective

Improvement of the electricity tariff system in Belarus is the overall objective of this task.  Such an overhaul of tariffs will benefit both industrial and individual consumers.

INOGATE experts are proposing a model and a set of recommendations to assist the Ministry of Energy in amending the current methodology of its electricity tariff calculation. In future, there will be different electricity tariffs for different consumer groups. Such a model must take into account two proposed nuclear energy units which are foreseen by 2020 and will contribute to the Belarusian electricity system. In anticipation of this new energy source, the following elements will be defined:

a) Demand will be forecast by selected consumer class.

b) The impact of the nuclear power plant on the supply mix will be assessed, and the impact of the plant on the cost of energy generation will be evaluated. The cost of electricity purchase will take into account both capacity and energy charges.

c) The revenue requirement and average tariffs of transmission and distribution will be determined, before and after introduction of the nuclear power plant. These will reflect the cost of electricity purchase, transmission, distribution and supply costs.

d) The consumption patterns of different consumer categories will be analysed and cost-reflective, differentiated tariffs will be proposed for application after the new nuclear power plant is in operation;

e) Existing cross-subsidies will be identified and a timeline will be proposed for the rationalisation of tariffs, taking into account the expected commencement date of operation of the nuclear power plant.