The rates for gas and electricity are increased.

According to the decision of the Government Commission for budget engineering which was taken in the beginning of September 2011 and which limits natural monopoly rate increase in the inflation rate, the rate increase for gas and electricity was 5,6 - 6%. Moreover, by the decision dated 2012 the indexation of all natural monopoly rates was also delayed excluding Russian railway roads. The delay date is the second half of the year.

(Pic. 1.1 – Rate increase for
gas and electricity.)

Electricity.
After the rate increase the prices are the following: Moscow citizens will pay 4, 2 rubles for 1 kWh according to a single rate tariff; the citizens of Moscow regions will pay 3, 58 rubles for 1 kWh according to single rate tariff.
The rate increase of “Federal Grid Company” electricity transmission.

According to the independent heating plan for the house:

• Beginning from the 1st of July, 2012 – 11%;
• Beginning from the 1st of July, 2013 – 9,4%;
• On the 1st of January, 2011 electricity tariff indexation increased the prices for 10%.

Gas.
Beginning from the 1st of July gas price for citizens and for industrial consumers will be increased for 15% on the average. Beginning from July, 2012 it’s supposed to make a calculation of wholesale gas price according to new formula taking into account a principal of equal income after selling on domestic and external markets. Calculating the domestic price level there will be included a decreasing coefficient to adjust the prices considered in the forecast of social and economic development of Russia.

(Pic. 1.2 – Rate increase for gas.)

For independent producers, beginning from the 1st of July there will be also increased transportation cost for gas delivered by the main gas pipeline of “GAZPROM”. Here is 7% increase.

Speaking about all categories of consumers except the citizens an average gas price increase during the year will be 7, 1%. This figure will be increased for citizens till 10, 4%. Increase scheduled for 2013-2014 for all categories of consumers is no more than 15%. This exceeds the forecasted inflation level of 2012 but this is less than original requirement of gas corporate.

According to the announce made in March by Vladimir PUTIN, the Prime Minister of Russian Federation, an additional increase of OAO “GAZPROM” rates for domestic market will not occur in 2012. Then, the head of “GAZPROM” Aleksey MILLER announced that the Corporate was ready to work according to adopted rates. But in spite of this Aleksey MILLER, a head of deliveries organization, transport and gas storage department announced his opinion in the beginning of the year, where he said that additional increase of local prices for gas was considered by the Corporate as a necessary solution.