How much water tariffs will increase in Narva in autumn is still unknown

2023-07-13 11:00:27

Narva Vesi has submitted detailed information on all its costs to the Competition Department, the department officials will assess their validity and make a decision. Photo: Tatyana Zavyalova

Despite the increase in the price of AS Narva Vesi service by approximately 12 percent from 1 September 2022 and the abolition of the 7.5 percent discount for apartment associations paying on time, the water company owned by Narva and Narva-Jõesuu ended last year with a minus of 793,255 euros.

A year ago, Narva Vesi board member Dmitry Lipatov predicted that an increase in the price of electricity would increase Narva Vesi’s production costs by almost 1 million euros per year. As a result of the increase in tariffs, costs increased by only about 800 thousand euros.

According to Dmitry Lipatov, this minus did not increase in 2023, but the company hopes to solve its problem by raising the tariff. On June 30, the company sent detailed information to the Competition Department about its cost items for the service provided, not only for electricity, but also for the increased price of gas, chemical reagents for water purification, components for technological equipment and water supply networks.

It should be reminded that last year the Competition Department set new prices for water and sewerage in Narva, taking into account Narva Vesi’s rapidly growing electricity costs (only electricity).

The discount for apartment associations was also abolished, which had the opportunity, in case of timely payments, to save 7.5 percent of the total amount. Such a benefit was recognized as illegal, since it applied only to CTs, which discriminated against consumers of the service living in private homes.
Last year, the board of AS Narva Vesi approved a decision to raise the tariff and cancel the 7.5 percent discount, although it was not required by law to do so.

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Everything related to the size of the cost of the services of water enterprises is at the mercy of the Competition Department. He has his own tables, his own methodology, his own principles for calculating prices, and they are not completely clear to us.

This year, from July 1, a new version of the Law on Public Water Supply and Sewerage came into force, which clearly states that water tariffs in the republic are set solely by the Competition Department, that is, local authorities cannot influence them in any way.

According to the legislation, a water company is obliged to inform the Competition Authority about changes in service cost items if the amounts increase or decrease by more than 5 percent during the year. After considering the feasibility of all items of expenditure, the department decides whether the company has the right to ask for an increase in the tariff, which it then does in case of a positive decision.

What could be the growth of tariffs this time, what percentage it will be at least roughly, Dmitry Lipatov prefers not to guess.
“Everything related to the size of the cost of the services of water enterprises is at the mercy of the Competition Department. He has his own tables, his own methodology, his own principles for calculating prices, and they are not completely clear to us. Narva Vesi has submitted detailed information about all our expenses to the department, its officials will assess their validity and make a decision,” says Lipatov.

He assumes that the tariffs of AS Narva Vesi will remain the lowest in Ida-Virumaa even after the increase, but the price of water supply to private consumers in Tallinna Vesi may be lower.

Dmitry Lipatov believes that the Competition Department may set new tariffs in September.

Narva Vesi Board Chairman Igor Andreev told NG that “last year’s price increase did not cover the company’s increased costs, and Narva Vesi took the brunt of the financial blow.”

Andreev emphasizes that the company is constantly engaged in the process of optimizing technological processes, more efficient use of resources and reducing operating costs.

Roman Vikulov

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