Increment of "Rushydro"'s loss compensation in the DFO suggested at 5.37 billion rubles by FAS
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Title: Russian Energy Firm, Far East Generating Company (FEG), to Receive Extra Compensation
Listen up, folks! It looks like the Far East Generating Company (FEG), part of "RusHydro," might be getting an extra cash injection of 5.37 billion rubles, according to a recent report by "Kommersant." This additional compensation would bring the total sum to a whopping 22.5 billion rubles.
Initially, the losses sustained by FEG's thermal power plants were expected to be mitigated by industrial consumers paying for capacity. However, the tariffs for 2024 failed to account for the surge in fuel costs. The Federal Antimonopoly Service (FAS) is proposing to rectify this oversight by boosting the monthly capacity payment by an extra 625 million rubles starting from July 1, 2025.
FEG relies heavily on coal as its primary and reserve fuel, causing its tariff policy to lag behind fuel costs. This discrepancy became painfully clear when FEG's net loss under Russian Accounting Standards skyrocketed to 42.7 billion rubles in 2024, and "RusHydro"'s fuel expenses for the first quarter of 2025 reached an all-time high of 48.5 billion rubles (a 3.2 billion rubles increase year-on-year), as per company data.
The proposed compensation isn't just good news for FEG; it's also causing a stir among energy experts. The final price of electricity in the Far East is expected to rise from 5.89 rubles per 1 kWh in 2025 to 8.84 rubles per 1 kWh in 2030. This means higher electricity bills for consumers. Critics argue that while the proposed measures offer financial stability for FEG, they could prove to be an additional burden for already-strained consumers.
As the details unfold, keep your eyes peeled for updates. The energy sector can be a rollercoaster ride, and it looks like FEG is in for a wild one!
The proposed compensation for Far East Generating Company (FEG) could potentially affect the finance sector, as the increased monthly capacity payment might lead to higher electricity bills for consumers in the Far East. Additionally, the surge in fuel costs for FEG, primarily relying on coal, highlights the impact of the energy sector on the finance industry.
