Electricity, gas tariffs may rise in Armenia

/AzerNews/

By Mushvig Mehdiyev

Depreciation of Armenia's national currency will inevitably lead to an increase in the electricity tariffs, according to Areg Galstyan, Deputy Energy and Natural Resources Minister.

Speaking at a press conference in Yerevan on December 17, he said: “What we have witnessed in the past month will have its direct impact on our calculations and approaches.”

Galstyan said no measures have been taken to avert the rise in electricity prices, saying: “No one can say anything now. But one thing is clear that the influence will be unavoidable.”

The tariff for electricity in Armenia rose twice in the past two years, as the price ran up by 27 percent in July 2013, followed by a 10 percent increase a year later. At present, households in Armenia pay 41.85 drams ($0.09) per kilowatt of electricity.

One dollar is now buying 570 drams in Armenia's exchange markets, upsetting the Central Bank's forecasts at around 410-415 drams.

Meanwhile, Gazprom Armenia, the company regulating gas operations in the country, may apply to raise gas tariffs in Armenia given the dram's sharp fluctuation.

Shushan Sardaryan, Spokesman for Gazprom Armenia, said if the rate of foreign exchanges keeps on climbing in Armenia, causing the gas company to suffer from huge losses, Gazprom Armenia may apply to the relevant bodies to reconsider the tariffs for gas.

"The company's specialists are conducting daily monitoring of the current financial situation in Armenia. Gazprom Armenia has the right to call for an increase of gas tariffs amid the dram's depreciation against the dollar," he noted.

Currently, Gazprom Armenia pays $189 for 1,000 cubic meters of gas.

Financial hassle in Armenia is continuing to inflict hard blows on various economic and industrial sectors with the dram's entrance into a free fall the chief factor. Armenia's weakening economy, which greatly depends on Russia's economic skills, promises nothing positive, but a deeper crisis and a simultaneous economic decline with Russia.

The Armenian Central Bank urges the commercial banks to sell limited amount of dollars ($1,000 per customer) to the residents, hanging on a hope to forestall the fall of the dram.

But every effort by the Armenian government to curb the financial scourge has been fruitless so far, as the experts see no economic prospects in the country where a super market has begun to offer special New Year loans to help the poor people celebrate the holiday.