Kazakh Government to lower electricity, garbage collection tariffs

ASTANA – Tariffs for electricity, natural gas, coal, heating, water, capital house maintenance firms and telecommunication will decrease Jan. 1, 2019, said Kazakh ministers at a Nov. 26 government meeting.

Bakytzhan Sagintayev and ministers. Photo credit: primeminister.kz.

Minister of Energy Kanat Bozumbayev reported on electricity and commercial gas price reduction measures.

The ministry is lowering tariffs and cost for electricity, from 700,000 tenge (US$1,913.80) to 590,000 tenge (US$1,613.06). It is also developing a draft order to decrease marginal wholesale prices for commercial gas, which will reduce the final price from 12 percent to 22 percent for power plants.

“We are currently conducting an audit of the relevant costs among all power plants in conjunction with the General Prosecutor’s Office and the Atameken National Chamber of Entrepreneurs. At some stations, tariffs will be reduced by 25 percent and, at others, the decrease may be less. For example, in the southern regions, tariffs at stations which operate on gas may remain the same,” added Kazakh Vice Minister of Energy Sungat Yessimkhanov, stressing that further tariff growth is to be prevented.

Kazakh Minister for Investments and Development Zhenis Kassymbek reported on a draft memorandum between local authorities and distributors to reduce household coal tariffs by 15 to 20 percent, which will be implemented this week.

The price of household coal currently averages 15,000 tenge (US$41.01), depending on the coal quality and distance to the end user. After the memorandum is implemented, prices will decrease 16 percent in the Akmola region, 18 percent in the Almaty region, 17 percent in the North Kazakhstan region and 14 percent in Shymkent.

Minister of National Economy Timur Suleimenov also reported on reducing tariffs for heating, water and KSK services.

“Thirty-two monopolists in electricity, heating and water services have agreed to reduce tariffs by 20.3 billion tenge (US$55.5 million). To identify unjustified income received by monopolists and return it to consumers, 33 unscheduled inspections have begun and 24 will begin soon,” the minister said.

In the Zhambyl region, for example, capital house maintenance services will decrease 6.7 percent, garbage collection services by 5 percent and elevator services by 7 percent.

A draft law on business environment development and trade activity regulation, under consideration at the Mazhilis (lower house of Parliament), will also include amendments to increase transparency in the tariff setting, control and implementation process.

Vice Minister of Information and Communications Dinara Scheglova reported on telephone and internet tariff reduction measures in rural areas, which have been provided at a reduced cost since 2013 by virtue of state budget subsidies. This year, 8.7 billion tenge (US$23.79 million) was allocated in subsidies.

“According to the latest data from the World Economic Forum’s Global Competitiveness Index, Kazakhstan occupies a high position in the tariff accessibility of communication services,” the vice minister noted.

The ministry gathered Kazakhtelecom, Transtelecom, KazTransCom, Kcell, Kar-Tel and Mobile Telecom Service to develop price reduction measures for communication services.

“Following the meeting, the telecommunication operators suggested reducing tariffs by developing affordable social tariff plans. The ministry was tasked with submitting proposals on the structure, volume of services and new tariff plan prices by the month’s end,” she added.

Prime Minister Bakytzhan Sagintayev, after being briefed on the reports, called for additional decreases in garbage collection tariffs, given that tariffs grew 30 percent in the East Kazakhstan region, 46 percent in the West Kazakhstan region, 50 percent in the North Kazakhstan region and 40 percent in Almaty in the past year.