As it was expected, the Public Services Regulatory Commission (PSRC) has approved the price suggested by the ArmRusGazArd company with minor changes.
The ArmRusGazArd company suggested to increase the price from 96 dram to 136 dram for the users consuming up to 10,000 cubic meters a month, and the PSRC approved the rate at 132 dram per cubic meter. In addition, for the users consuming more than 10,000 cubic meters of gas the company suggested to increase the price from 215 dollars to 256 dollars per 1,000 cubic meters, and the PSRC approved the price at 243.13 dollars. The reason why the PSRC approved lower rate was connected with the calculations of the ArmRusGazArd company. For example, the plan submitted by the company writes that it has 5200 employees, but the PSRC finds that this company can work with 4500 employees as well. The company writes that the median wage was defined at 130 thousand dram, but the commission finds that they can pay 100 thousand dram. Of course it does not mean that the company will fire employees or will cut down salary expenses, but it means that these expenses envisaged by the company will not be calculated in the company’s incomes and will be covered by the company profits. During yesterday’s session the representative of the ArmRusGazArd company presented the reasons why the price should be increased, and such reasons are the raised price of gas import, currency exchange rate growth, investments in the gas sector and reduction of natural gas use capacity. The representatives of non-governmental organizations in charge of the protection of consumers’ rights, as well as some members of the Public Chamber, in fact did not have objections about the increase of the gas prices after the explanations given to them by the board chairman of the ArmRusGazArd company Karen Karapetyan. They were mostly speaking of the impacts resulting from the increase of the price. In the end everyone thanked for such “open and public discussion” and said they hoped the other upcoming sessions of the PSRC would proceed in such transparent conditions as well. “The process of the price increase during the recent years shows that this process has not reached the final point. We don’t know how much it will be, but we know for sure that the price is going to be increased in the future as well. We understand that most of the reasons are objective, but the economy does not grow in our country, salaries are not indexed even in the state sector, and generally there is no social justice,” said the head of the Consumers’ Rights Protection NGO Abgar Yeghoyan. “Next year the price of imported gas on the border will be 270-300 dollar, and if the prices are calculated according to this methodology, the price will be more than 400 dollars. This policy of the government is crossing the permitted limits, after which there are issues connected with national security. A little has remained till the collapse of the economy and if it happens, it will be nonsense to speak of the ArmRusGazArd’s incomes,” said Hakob Gharabekyan, a representative of another organization involved in protection of consumers’ rights. The chairman of the PSRC Robert Nazaryan and Karen Karapetyan answered journalists’ questions.
Robert Nazaryan assured that the price of electricity would not grow because our country will produce electricity and will not export a part of it to Iran but will use this electricity to meet the demands of the society. Former prime minister Hrant Bagratyan has raised this question too and he asks how is the price for citizens twice more expensive than the import price. “The rate of 340 dollars is the equivalent of the price in dollar for the citizens. The median rate of the gas sold to citizens and large consumers is 283 dollars, VAT included. If we deduct the VAT from this amount (47 USD) and the losses and current costs during transportation and supply of gas, it becomes 225. Accordingly, the margin that remains for the ArmRusGazArd becomes 45 dollars (about the 16% of the selling price), which includes the current and maintenance costs for the gas supply system, as well as the amortization and profit,” said Karen Karapetyan. In answer to Hrant Bagratyan’s observation that in the entire world gas is provided to citizens for cheaper prices than large consumers the head of the PSRC and ArmRusAGazArd brought a contradiction together and said that in all places businesses buy gas for cheaper prices. In answer to this observation Karen Karapetyan said that ordinary consumers use only 38% of the gas supply but for providing this supply the company spends 60% of the gas supply expenses on them. In answer to the question when the ArmRusGazArd will apply for the next raise in the gas prices Karen Karapetyan said that it depends on the future changes in the market. However, he said that in case of drastic devaluation of the national currency they would not apply for price increase as they did last year as a result of the exchange rate drastic changes. In answer to the question whether he is sufficed with the price set by the PSRC Karen Karapetyan said, “As a manager I have been very passive on lobbying for and pushing forward the rate we want,” said Karen Karapetyan. We asked whether the owners of the company might think that the chairman does not work well and decide to fire him. After thinking for awhile he said, “Maybe”.