ENA Director General: Profit of Electric Networks of Armenia CJSC will amount to nearly 15 bln AMD in 2016  

ArmInfo. According to preliminary data, the profit of Electric Networks of Armenia (ENA) CJSC will amount to nearly 15 bln AMD in 2016, ENA Director General Karen Harutyunyan told reporters on Wednesday.   

He said that in H1 2016 the profit also amounted to 15 bln AMD, which cannot be considered surplus profit, because after the growth in the tariff of the electric power sold by the company, it was envisaged to spend the entire profit on redemption of overdue liabilities. The company's margin grew to 23.5 bln AMD.  The level of collection of payments also rose. As a result, the company completely carried out all its obligations to the generation facilities. In the meantime, Harutyunyan said, that one should not make far- reaching conclusions from the success of H1 2016, because the first half year usually sees melting water flood and the hydropower plants contribute to profit growth due to the cheap electric power. In the second half year, however, a number of small HPPs will not generate electricity at all or will sharply reduce the output. Moreover, the development of small-scale HPPs has been exhausted in terms of effective use of hydro resources.

As regards the Armenian NPP, Harutyunyan recalled that due to long-term suspension of the NPP's activities, the network damage totaled about 5 bln AMD. On September 20 the NPP operation will be suspended for 40 days for scheduled maintenance. As a result, the company will either have to purchase the most expensive electricity from Hrazdan TPP or buy it from Iran. Another factor influencing the indicators of the first half year is the reduction of losses. 1% decline in losses provided the company with extra 1.3 bln AMD due to reduction in operating expenses and more efficient expenditure management. "Each company should intend to gain profit, but ENA will never receive surplus profit," he said, adding that in accordance with the license, the entire surplus profit should be spent on strengthening the resources of the entire energy sector of the republic.

On 30 Sept 2015, Tashir Group headed by Russian businessman of Armenian origin Samvel Karapetyan and Inter RAO signed an agreement of purchase and sale of electric power assets of the Russian energy holding in Armenia - ENA CJSC and Hrazdan TPP. The reason of the sale was the public discontent about the ungrounded growth in electricity prices by approximately 16.7% (6.93 AMD per 1 kWh). The Public Services Regulatory Commission's (PSRC) decision to raise the tariff sparked protests and the Armenian authorities agreed to audit both the expediency of PSRC's decision to raise the tariff and the activities of the Electric Networks. In addition, the authorities and Tashir Group took a decision to subsidize on a parity basis the raised tariff for the households and SMEs until the audit is completed. Since August 1, 2015, the daytime tariff for households (from 7 am till 11 pm) has been 48.78 AMD per 1kWh, while the nighttime tariff has been 38.78 AMD per 1 kWh.