YEREVAN, July 29. / ARKA /. Currency fluctuations do not have a significant impact on the rise in electricity prices in Armenia, Professor Ashot Tavadyan said in an interview with ARKA news agency when presenting the findings of a relating research conducted by a team of experts led by him.
“It is often argued that a dramatic change in the cost of USD against Armenian dram, when the USD’s value rose from 410 to 475 drams has had a negative impact on the electricity price hikes. But if you make a deeper look, you will see that the dram’s exchange rate did not see significant changes from 2005 to 2015,” said Tavadyan.
He said in 2005 one dollar cost 458 drams (1 kWh of electricity was worth 5.5 US cents,) and now it is about 475 drams (the price of 1 kWh of electricity is to grow to 10 US cents) and ‘ consequently, the rise in electricity tariff was not prompted by the exchange rate.’
“We see that electricity tariffs in ten years have actually doubled. This means if we consider the evolution of dram’s exchange rate it turns out that it should not have a significant impact on the growth of electricity prices,” said Tavadyan.
According to him, one should not forget that there were very “good” years; for example the years of 2008 and 2009. “In 2008 one US dollar cost 306 drams and the exchange rate was very” friendly as the dram rose in price from 458 drams to 306 drams and the revenues in dollars also rose. But if we consider figures for one year, the currency fluctuations may have some impact,” he said.
On June 17 Armenia’s Public Services Regulatory Commission (PSRC) raised the prices of electricity by over 16 percent, down from 40 percent rise sought by Armenia’s national Russian owned power distributor company the Electricity Networks of Armenia. This decision triggered a civil movement No to Plunder that kept a central Yerevan street blocked for traffic for days.
On June 26 president Serzh Sargsyan said the government will commission an audit of the company to find out whether the price hike approved by state regulators was economically justified or resulted from alleged corruption and mismanagement.
The next day Sargsyan said the government will keep the tariffs unchanged for consumers by subsidizing their increased cost at least until the release of findings of the audit. -0-
