Business urges to delay the introduction of mandatory balancing neutrality charges
The European Business Association together with the Association of Gas Producers of Ukraine, the American Chamber of Commerce in Ukraine, the Association of Gas Traders of Ukraine and the Association of Subsoil Users of Ukraine appealed to the National Commission for State Regulation of Energy and Public Utilities to postpone the introduction of mandatory balancing neutrality charges for one year (until October 1, 2021) and together with the GTS Operator of Ukraine, service users and relevant Associations to improve the method and approaches to the calculation of this charge.
According to the GTS Code, the neutrality charges has been already accrued to gas companies and other users of transportation services from March 2020, but this accrual is still considered nonmandatory. However, from October 1, 2020, these charges must be paid to the GTS Operator.
The market participants are concerned about unreasonably high payments for balancing neutrality, the tendency to increased monthly charges, and the incomprehensible calculation methodology. Thus, between March and June, the charge rate increased almost four times and today, in fact, is equal to the size of the tariff for transportation services.
At the same time, given the COVID-19 crisis and record low hydrocarbon prices, the additional unjustified financial burden will deal a powerful blow to the industry and bring negative economic consequences.
Therefore, to avoid this situation, the European Business Association together with the relevant Associations call on the Regulator to postpone the introduction of mandatory balancing neutrality charges for a year and, in parallel, improve the calculation methodology to make it more transparent and understandable to market participants. We hope the voice of business will be heard!
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