The chief executive of Armenia’s Russian-owned power distribution network provoked an angry rebuttal from the national utility regulator on Friday after blaming the Armenian authorities for its financial troubles that will lead to a further increase in electricity prices in the country.
Yevgeny Bibin also came under fire from opposition lawmakers because of snubbing parliamentary hearings on a nearly 40 percent price rise sought by his Electricity Networks of Armenia (ENA) utility.
“I consider Mr. Bibin’s absence a manifestation of contempt for and impudent attitude towards to Armenia’s legislative body,” said Naira Zohrabian of the Prosperous Armenia Party (BHK).
The hearings were organized by the Armenian parliament committee on economic issues ahead of a keenly anticipated decision by the Public Services Regulatory Commission (PSRC) on the higher energy tariffs requested by the ENA.
The company, which is owned by Russia’s RAO Unified Energy Systems (UES) giant, says that the unpopular measure is needed to end its massive financial losses and outstanding debts to power plants and commercial banks worth 106 billion drams ($225 million). More than a third of those debts have been incurred in the last three years.
In an interview with the Arminfo news agency on Thursday, Bibin said the authorities in Yerevan could have prevented much of those losses had they heeded ENA concerns and carried out “fair market reforms” in the energy sector. “Unfortunately, no matter how much we asked, nothing has been done,” the Russian executive said.
Robert Nazarian, the PSRC chairman, reacted furiously to these claims during the hearings. “Mr. Bibin is lying,” he charged.
Nazarian was also incensed by the ENA chief’s refusal to acknowledge that the company’s debts have resulted in large measure from poor management. The ENA could have cut those losses if it had used its earnings more efficiently, he said.
The chief regulator made clear at the same his commission will have to raise the energy prices by over 16 percent. He said this increase is needed to make up for the recent depreciation of the Armenian dram and last year’s dry weather that caused hydroelectric plants to cut their production levels. The ENA had to buy larger volumes of the more expensive electricity generated by thermal-power plants.
The opposition deputies attending the hearings dismissed these arguments.
Both the Armenian opposition and a non-partisan pressure group campaigning against higher electricity prices accuse the ENA of forcing Armenians to pay for its mismanagement and profligacy. The group called No To Plunder is due to again rally supporters in Yerevan next week.