In the last year the gap in economic performance of private and public utilities. Despite the fact that all energy companies formally placed under equal conditions, in particular lower depreciation of fixed assets and losses and at the same time would be better indicators of fund-raising from the market. How to find market participants in the present circumstances the Government will strive towards privatization of energy companies despite the fact that their prices have dropped by 70%.
Economic gap
According to the Ministry of Fuel, the last year increased the difference between the economic performance of private and public energy companies. Such a trend among power producers, and among the distribution companies. For example, depreciation of fixed assets from private generations is 25%, from the state - 79%. The comparable figure for private power companies is 41%, while the public - 89%. Loss of electricity networks in 2008 in 12 private power companies accounted for 9% (in 2007 - 11%), in the state - 17% (in 2008 - 16%).
told the vice-president of the National Joint Stock Company Energy Company of Ukraine (NAK EKU) Sergei Serdyuk, depreciation of fixed assets of state generating companies, as opposed to private, is growingfrom year to year. In 2016 it will reach a point where Ukrainian generation simply can not meet demand for electricity. To stop this process, it is necessary, according to Serdyukov, $ 17.5 billion investment. Another problem of generations of public power companies and is the ongoing growth of accounts payable. In the state of generations and power companies, according to the NAK EKU, payable in 2007 increased in 3,5 times, while in private she is constantly decreasing.
Head of analytical department of IR BrokerCreditService Maxim Shein noted that the main problems gosgeneratsy - not so much financial as managerial. Over the past five years, none of the state-owned energy companies did not conduct an audit involving a large international consulting company. State Company does not introduce new systems of governance and innovation. Money spent on plugging holes rather than global changes. What is happening today in the public power companies and generation can be described in one word - stagnation, - says the president of the Energy Consulting Group Alex Sheberstov.
Energy
owner
According to committee member of the Verkhovna Rada on thermal power station Mikhail Volynets, private power companies achieve better results in almost all areas of its activities. First of all, they show good discipline. Virtually all private power companies, even in traditionally difficult for settlement areas, such as Lugansk, Zaporozhye, Sumy, achieving 100 per cent of consumers. Before privatization in the most problematic - Lugansk - the percentage of payments amounted to 45-55%, - notes Wolyniec.
norm has been the development of new lines of business. Thus, Lvovoblenergo investing in the project for the production of new advanced energy meters and DTEK and Lugansk Energy Association began to build their own wind power plant. The cost of wind energy, according to LEO, will be 0,1-0,4 euro cents, which is four times less than the price of thermal energy.
Three of the twelve private power companies (Poltava, Lugansk, Zaporozhye) resulted in quality management of its services in accordance with ISO 9001, which is important for obtaining loans from international banks. Finally, the normal practice to have the financial statements of the privatized power companies to international standards and attract private auditors from the Big Three. None of the state energy companies do not prepare such reports, although they are extremely important especially for potential investors, - says Mr. Shein.
Formally, the private and public power companies have equal rights to receive an investment allowance. However, in practice, private companies often manage to defend its investment program in full, without abbreviations National Commission Electricity Regulation, said Alexei Sheberstov. According to him, over the past five years, private power companies on average attracted 25% more investment than the government.
Selling mood
solve the problem of financing can be extremely c through privatization generations and power companies, said Sergei Serdyuk. He notes that there are several other theoretical ways to attract capital, but in practice they do not work. For example, the state budget deficit makes it impossible to finance generations by the state. Borrowings may not be held due to significant debt obligations of public power companies and the difficulties in obtaining state guarantees. Companies controlled by the state, is difficult to obtain funds from investors because of imperfection of the mechanism to attract investment and lack of control over their return.
According Sheberstova, Ukraine is already late with the privatization of power companies and generations. It had to do more in the first half of last year. Generation and power companies all thetime left for later, by now, asset prices have fallen by 60-70%, - agrees Maxim Shein. However, delayed privatization for another year as useless, experts say. No one can predict how long the crisis and whether the price will drop even more, - said a committee member of the Verkhovna Rada on thermal power station Sergei Tulub.
According to Sergei Serdyuk, according to the strategy of privatization of generations and power companies, which NAK EKU proposed to the Government, the best solution is the privatization of a controlling stake in these companies (60% 1 share). In this case, increasing the possibility of attracting a strategic investor and remains limited state control over energy companies. At the same time, sales of 100% of government shares lead to a blurring of responsibility for the performance of fixed terms, and the sale of a minority stake - the loss of attractiveness of facilities for strategic investors. Until now we have to privatize treated as a way to replenish the budget. But the energy is more important than another - the quality of facilities and modernization. Therefore, further delaying the sale of power companies useless. I think in the Cabinet understand it, too, - Sergey Tulub agrees. According to Kommersant in the Cabinet of Ministers, the Government has settled on a privatization plan for next year.
Generation of need primarily in investment
Edward Sokolowski, chairman Kyivenerho
- Are you able to in the present circumstances to invest in the development of the company?
- Given the state of networks and equipment, we simply must invest in the industry. If you continue to delay the modernization, in the near future, there's nowhere to invest - wear of electricity is over 50%. But at the present level of tariffs to upgrade is simply impossible. Is therefore necessary to consider the possibility of attracting investment in other ways.
- How many investment projects carried out your company over the past year?
- We do not have many big projects. They carried their own expense. If we talk about 2008, the company has invested 177 million UAH. Plans for 2009 - the development of 201 million UAH. That and the electrical and the thermal network.
- Are you pleased with this volume?
- Of course, these investments are not enough. This is evidenced by at least a constant rise in the depreciation of our fixed assets. Only the program of development and modernization of electric networks, approved by the Cabinet, we need more than 2 billion UAH. Therefore, to solve the problem of modernization only through tariffs today we can not.
- Do you find common language with the National Commission for Energy Regulation of growth of tariffs for electricity produced?
- Yes, we find. Finally on Oct. 1, 2008 the Commission decided on the specifics of the Kiev energy unit. Our power plants are gas and therefore uncompetitive. Since January this year we have losses due to high gas prices. Now, after this decision, we will be able to operate without loss.
- What about the electricity bill? Percent paid electricity is reduced or increased?
- level calculations of the population is close to 100%. But the population consumes only 30% of electricity. Calculations of the same number of enterprises that are financed from the state budget, leave much to be desired. This is particularly utilities - Kiev underground, Kievteplotrans and Kievgorsvet. Their duty over the past three months is about 40 million UAH, 300 million UAH more, we must Kyivvodocanal.
- Does thegeneration of privatization and, if so, when should a sale of businesses?
- Generation needed primarily in investment. How to get them - is another question. Perhaps, through privatization, and perhaps at the expense of state subsidies or international grants. Of course, privatization - is the most effective way to attract investment.
- What are the power companies are now doing better - private or public?
- It is considered that public companies are more prone to executive influence, and therefore less effective. In general, the phenomena inherent in the industry - non-payment, credit problems - there is a public and private companies.
We are building a company that focuses on client
Vitaly Tsado, general director of Luhansk Power Association
- this different than the situation in the private and public energy companies?
- Private companies operate much more efficiently. Suffice it to compare the figures for losses in electricity networks and the collection of money from the market. All these figures we have better. In addition, private companies are adopting the latest business management systems, management and resources. In public companies, nothing like this happens.
- Do the private companies are more preferences for approval of tariffs?
- None. Industry is so regulated that the benefits in respect of tariffs is not no one, regardless of performance.
- Then by what you can have the best rates on payments?
- Due to the different approach to doing business. We, in contrast to the state energy companies, makes all clients the same requirements regardless of whether private consumers or the public.
- What exactly do you do, do not do public power companies?
- In contrast to the state power companies, we are building a company focused on the client. We are trying to come to him themselves, to offer additional services, ask the experts about the quality of service. Actively fighting losses and optimize costs in each segment. Introducing a system of certification of management, conducting an international audit, obtain the recommendations of international companies. In addition, we spend considerable resources on innovation. For example, is now introducing a system that helps to quickly track the movement of mobile repair teams. Also, we are actively solve the problem of low skills in the market - spend a lot of money on training and ratings of the competence of staff.
- How did you manage to attract investment to modernize Lugansk Energy Association in the past year, how many in this?
- Last year, we implemented an investment program for 253 million UAH, this year - at 147 million UAH. The decrease in investment occurred at the initiative of the National Commission Electricity Regulation (NERC). Of course, this money is not enough to put in order the network, in which for many years no one has invested. Web age, and household electrical power grow. Calculated power grids, which was designed in the 60's and 70's, can not withstand the current load.
- Are you able to find common language with NERC in question include the investment allowance in the tariff?
- Just because money is not sypyatsya. All that is needed to prove.
- When, in your opinion, is to privatize the energy companies?
- Today, the liquidity of the assets of energy companies is quite low, and because it was felt that they should hold. On the other hand, privatizationwill attract investment and improve management of energy companies. And if this is the main goal - then privatization is now.
Alexander Couple, senior analyst with BG Capital
Practice shows that the privatization of Ukrainian energy companies, to create conditions for sale at high prices is much easier than expected to achieve this effect - investment in companies with new owners.
in 2001 created unique conditions for six of the privatized power companies: unlike the rest of the sector companies, their profits accrued by consumers of electricity, and with each torque, is invested from the profits back into the company, should automatically provide investors with 17 kopecks . additional revenue next year. But at first glance attractive not worked in practice.
size of investments in private and public power companies after privatization is not much different. This can be seen in the power losses in the networks as a leading indicator of investment efficiency. If the first four months of 2001 (ie, prior to privatization), six of the privatized power companies collectively lost in the networks of 26,3% of the electricity, then four months in 2009 - 15,7% - efficiency increased in 1,71 times. Companies remaining in state property, reduce the total losses from 21,9% to 12,3%, or 1.68 times - hardly a noticeable difference compared with privatized.
In practice, it turned out that was promised in 2001, the yield on new investments the owner could obtain only after months of approval of investment plans with the various bodies that have a special look at how and what to invest. Adding to the disorientation of the investor because of the frequent rotation of personnel in regulatory bodies. As a result, owners of the power companies chose to display all the profits from the company, paying its dividend.
If the owner does not see the prospect of earning on their investments, then make it impossible to invest in development - to engage in charity, he will not. Therefore, regardless of whether it would be privatized, the inflow of private investment in energy companies is possible only after the State will provide a transparent and stable mechanism for the return on investment.
Oleg Gavrish
Russia market has not yet determined the direction of further movement and consolidated
Valery Vasilyev and Sergei Timofeyev appointed new board members RAO ES of the East
Board of directors approved a reduction of its investment group in 2009
American share platforms, started the day for the health, completed its in negative territory
Forex Market 30.09.2009
Russians once again fell in love with deposits in foreign currency
Russia's indexes show mixed dynamics of bidding, ignoring the favorable world sites
Better the market today look back shares MRSC of North Caucasus and IDC Holding, went up by 28,8% and 3,4%
Russia's indexes are near annual highs, trying to find drivers for continued upward movement
State loses amperage
Private power companies are working much more efficiently …
In the last year the gap in economic performance of private and public utilities. Despite the fact that all energy companies formally placed under equal conditions, in particular lower depreciation of fixed assets and losses and at the same time would be better indicators of fund-raising from the market. How to find market participants in the present circumstances the Government will strive towards privatization of energy companies despite the fact that their prices have dropped by 70%.
Economic gap
According to the Ministry of Fuel, the last year increased the difference between the economic performance of private and public energy companies. Such a trend among power producers, and among the distribution companies. For example, depreciation of fixed assets from private generations is 25%, from the state - 79%. The comparable figure for private power companies is 41%, while the public - 89%. Loss of electricity networks in 2008 in 12 private power companies accounted for 9% (in 2007 - 11%), in the state - 17% (in 2008 - 16%).
told the vice-president of the National Joint Stock Company Energy Company of Ukraine (NAK EKU) Sergei Serdyuk, depreciation of fixed assets of state generating companies, as opposed to private, is growingfrom year to year. In 2016 it will reach a point where Ukrainian generation simply can not meet demand for electricity. To stop this process, it is necessary, according to Serdyukov, $ 17.5 billion investment. Another problem of generations of public power companies and is the ongoing growth of accounts payable. In the state of generations and power companies, according to the NAK EKU, payable in 2007 increased in 3,5 times, while in private she is constantly decreasing.
Head of analytical department of IR BrokerCreditService Maxim Shein noted that the main problems gosgeneratsy - not so much financial as managerial. Over the past five years, none of the state-owned energy companies did not conduct an audit involving a large international consulting company. State Company does not introduce new systems of governance and innovation. Money spent on plugging holes rather than global changes. What is happening today in the public power companies and generation can be described in one word - stagnation, - says the president of the Energy Consulting Group Alex Sheberstov.
Energy
owner
According to committee member of the Verkhovna Rada on thermal power station Mikhail Volynets, private power companies achieve better results in almost all areas of its activities. First of all, they show good discipline. Virtually all private power companies, even in traditionally difficult for settlement areas, such as Lugansk, Zaporozhye, Sumy, achieving 100 per cent of consumers. Before privatization in the most problematic - Lugansk - the percentage of payments amounted to 45-55%, - notes Wolyniec.
norm has been the development of new lines of business. Thus, Lvovoblenergo investing in the project for the production of new advanced energy meters and DTEK and Lugansk Energy Association began to build their own wind power plant. The cost of wind energy, according to LEO, will be 0,1-0,4 euro cents, which is four times less than the price of thermal energy.
Three of the twelve private power companies (Poltava, Lugansk, Zaporozhye) resulted in quality management of its services in accordance with ISO 9001, which is important for obtaining loans from international banks. Finally, the normal practice to have the financial statements of the privatized power companies to international standards and attract private auditors from the Big Three. None of the state energy companies do not prepare such reports, although they are extremely important especially for potential investors, - says Mr. Shein.
Formally, the private and public power companies have equal rights to receive an investment allowance. However, in practice, private companies often manage to defend its investment program in full, without abbreviations National Commission Electricity Regulation, said Alexei Sheberstov. According to him, over the past five years, private power companies on average attracted 25% more investment than the government.
Selling mood
solve the problem of financing can be extremely c through privatization generations and power companies, said Sergei Serdyuk. He notes that there are several other theoretical ways to attract capital, but in practice they do not work. For example, the state budget deficit makes it impossible to finance generations by the state. Borrowings may not be held due to significant debt obligations of public power companies and the difficulties in obtaining state guarantees. Companies controlled by the state, is difficult to obtain funds from investors because of imperfection of the mechanism to attract investment and lack of control over their return.
According Sheberstova, Ukraine is already late with the privatization of power companies and generations. It had to do more in the first half of last year. Generation and power companies all thetime left for later, by now, asset prices have fallen by 60-70%, - agrees Maxim Shein. However, delayed privatization for another year as useless, experts say. No one can predict how long the crisis and whether the price will drop even more, - said a committee member of the Verkhovna Rada on thermal power station Sergei Tulub.
According to Sergei Serdyuk, according to the strategy of privatization of generations and power companies, which NAK EKU proposed to the Government, the best solution is the privatization of a controlling stake in these companies (60% 1 share). In this case, increasing the possibility of attracting a strategic investor and remains limited state control over energy companies. At the same time, sales of 100% of government shares lead to a blurring of responsibility for the performance of fixed terms, and the sale of a minority stake - the loss of attractiveness of facilities for strategic investors. Until now we have to privatize treated as a way to replenish the budget. But the energy is more important than another - the quality of facilities and modernization. Therefore, further delaying the sale of power companies useless. I think in the Cabinet understand it, too, - Sergey Tulub agrees. According to Kommersant in the Cabinet of Ministers, the Government has settled on a privatization plan for next year.
Generation of need primarily in investment
Edward Sokolowski, chairman Kyivenerho
- Are you able to in the present circumstances to invest in the development of the company?
- Given the state of networks and equipment, we simply must invest in the industry. If you continue to delay the modernization, in the near future, there's nowhere to invest - wear of electricity is over 50%. But at the present level of tariffs to upgrade is simply impossible. Is therefore necessary to consider the possibility of attracting investment in other ways.
- How many investment projects carried out your company over the past year?
- We do not have many big projects. They carried their own expense. If we talk about 2008, the company has invested 177 million UAH. Plans for 2009 - the development of 201 million UAH. That and the electrical and the thermal network.
- Are you pleased with this volume?
- Of course, these investments are not enough. This is evidenced by at least a constant rise in the depreciation of our fixed assets. Only the program of development and modernization of electric networks, approved by the Cabinet, we need more than 2 billion UAH. Therefore, to solve the problem of modernization only through tariffs today we can not.
- Do you find common language with the National Commission for Energy Regulation of growth of tariffs for electricity produced?
- Yes, we find. Finally on Oct. 1, 2008 the Commission decided on the specifics of the Kiev energy unit. Our power plants are gas and therefore uncompetitive. Since January this year we have losses due to high gas prices. Now, after this decision, we will be able to operate without loss.
- What about the electricity bill? Percent paid electricity is reduced or increased?
- level calculations of the population is close to 100%. But the population consumes only 30% of electricity. Calculations of the same number of enterprises that are financed from the state budget, leave much to be desired. This is particularly utilities - Kiev underground, Kievteplotrans and Kievgorsvet. Their duty over the past three months is about 40 million UAH, 300 million UAH more, we must Kyivvodocanal.
- Does thegeneration of privatization and, if so, when should a sale of businesses?
- Generation needed primarily in investment. How to get them - is another question. Perhaps, through privatization, and perhaps at the expense of state subsidies or international grants. Of course, privatization - is the most effective way to attract investment.
- What are the power companies are now doing better - private or public?
- It is considered that public companies are more prone to executive influence, and therefore less effective. In general, the phenomena inherent in the industry - non-payment, credit problems - there is a public and private companies.
We are building a company that focuses on client
Vitaly Tsado, general director of Luhansk Power Association
- this different than the situation in the private and public energy companies?
- Private companies operate much more efficiently. Suffice it to compare the figures for losses in electricity networks and the collection of money from the market. All these figures we have better. In addition, private companies are adopting the latest business management systems, management and resources. In public companies, nothing like this happens.
- Do the private companies are more preferences for approval of tariffs?
- None. Industry is so regulated that the benefits in respect of tariffs is not no one, regardless of performance.
- Then by what you can have the best rates on payments?
- Due to the different approach to doing business. We, in contrast to the state energy companies, makes all clients the same requirements regardless of whether private consumers or the public.
- What exactly do you do, do not do public power companies?
- In contrast to the state power companies, we are building a company focused on the client. We are trying to come to him themselves, to offer additional services, ask the experts about the quality of service. Actively fighting losses and optimize costs in each segment. Introducing a system of certification of management, conducting an international audit, obtain the recommendations of international companies. In addition, we spend considerable resources on innovation. For example, is now introducing a system that helps to quickly track the movement of mobile repair teams. Also, we are actively solve the problem of low skills in the market - spend a lot of money on training and ratings of the competence of staff.
- How did you manage to attract investment to modernize Lugansk Energy Association in the past year, how many in this?
- Last year, we implemented an investment program for 253 million UAH, this year - at 147 million UAH. The decrease in investment occurred at the initiative of the National Commission Electricity Regulation (NERC). Of course, this money is not enough to put in order the network, in which for many years no one has invested. Web age, and household electrical power grow. Calculated power grids, which was designed in the 60's and 70's, can not withstand the current load.
- Are you able to find common language with NERC in question include the investment allowance in the tariff?
- Just because money is not sypyatsya. All that is needed to prove.
- When, in your opinion, is to privatize the energy companies?
- Today, the liquidity of the assets of energy companies is quite low, and because it was felt that they should hold. On the other hand, privatizationwill attract investment and improve management of energy companies. And if this is the main goal - then privatization is now.
Alexander Couple, senior analyst with BG Capital
Practice shows that the privatization of Ukrainian energy companies, to create conditions for sale at high prices is much easier than expected to achieve this effect - investment in companies with new owners.
in 2001 created unique conditions for six of the privatized power companies: unlike the rest of the sector companies, their profits accrued by consumers of electricity, and with each torque, is invested from the profits back into the company, should automatically provide investors with 17 kopecks . additional revenue next year. But at first glance attractive not worked in practice.
size of investments in private and public power companies after privatization is not much different. This can be seen in the power losses in the networks as a leading indicator of investment efficiency. If the first four months of 2001 (ie, prior to privatization), six of the privatized power companies collectively lost in the networks of 26,3% of the electricity, then four months in 2009 - 15,7% - efficiency increased in 1,71 times. Companies remaining in state property, reduce the total losses from 21,9% to 12,3%, or 1.68 times - hardly a noticeable difference compared with privatized.
In practice, it turned out that was promised in 2001, the yield on new investments the owner could obtain only after months of approval of investment plans with the various bodies that have a special look at how and what to invest. Adding to the disorientation of the investor because of the frequent rotation of personnel in regulatory bodies. As a result, owners of the power companies chose to display all the profits from the company, paying its dividend.
If the owner does not see the prospect of earning on their investments, then make it impossible to invest in development - to engage in charity, he will not. Therefore, regardless of whether it would be privatized, the inflow of private investment in energy companies is possible only after the State will provide a transparent and stable mechanism for the return on investment.
Oleg Gavrish
Russia market has not yet determined the direction of further movement and consolidated
Valery Vasilyev and Sergei Timofeyev appointed new board members RAO ES of the East
Board of directors approved a reduction of its investment group in 2009
American share platforms, started the day for the health, completed its in negative territory
Forex Market 30.09.2009
Russians once again fell in love with deposits in foreign currency
Russia's indexes show mixed dynamics of bidding, ignoring the favorable world sites
Better the market today look back shares MRSC of North Caucasus and IDC Holding, went up by 28,8% and 3,4%
Russia's indexes are near annual highs, trying to find drivers for continued upward movement