Ukraine Will Raise Household Electricity Prices 30%

KIEV, Ukraine -- Ukraine will raise household power prices by 30 percent beginning Feb. 1, said Ruslan Kaydash, deputy head of the electricity price policy department at the National Energy Regulatory Commission.

The price will be increased for households that consume more than 150 kilowatts a month if they use natural gas for cooking and more than 250 kilowatts if they use electric stoves Kaydash told reporters today in Kiev after a commission meeting.

The government increased gas prices for households by 50 percent in August and plans to raise them by an additional 50 percent in April to qualify for loans from the International Monetary Fund.

The increase pushed inflation to 8.3 percent in August from 6.8 percent the previous month, according to the state statistics agency.

“Electricity makes up 1.5 percent of the consumer basket,” said Olena Bilan, chief economist at Kiev-based Dragon Capital.

“The increase may add around 0.4 percentage points to the inflation rate in February, pushing it to 1.6 percent in February from the previous month.”

Ukraine’s annual inflation slowed to 9.1 percent in December, the lowest rate since 2003. The government forecasts that consumer price growth will slow to 8.5 percent this year.

On a monthly basis, prices rose 0.8 percent in December, compared with 0.3 percent the previous month.

Source: Bloomberg