New fuel and energy sector regulations in Russia and the world in Jan-Mar 2017

11 may 2017

The new review of the fuel and energy sector regulations in Russia and the world based on Q1 2017 data focuses on the reduction of the price of electricity and the price of motor fuels in the Far East the coincided with the new taxes being introduced in the fuel and energy sector.

In addition, the review analyzes the new rules that went into effect in Russia early this year, including the construction of the Turkish Stream pipeline, the rules for the approval of energy companies' investment programs, state support for the burning of solid domestic waste, financing and implementation of investment programs in the heat distribution and supply sector. The analysts are of the opinion that the most relevant among the planned changes are the exemptions for the natural resources extraction tax for companies producing gas condensate, the introduction of the guaranteed supplier status for liquefied hydrocarbon gas suppliers, investments in the development of natural gas supply systems, the simplified procedure for connecting properties to natural gas distribution systems. A large portion of the review is devoted to the upcoming changes in the electric power industry, which include changes in the regulations governing the rates of power grid utilities, qualification requirements for power generating facilities, support for Russian renewable energy technologies, additional criteria for organizations operating across multiple grids, stricter requirements for consumers with managed loads and other issues.

In the area of international experience in fuel and energy regulation the experts touched upon the investment attractiveness index of mining companies compiled by Fraser Institute for 2016. Among the innovations the expert regard as the most relevant the following: optimization of the budget revenue from the oil industry in Ukraine, the new mechanism for national product division agreements in Indonesia, the green certificates program in China, the efforts to improve the conditions for connecting to natural gas distribution infrastructure in Turkey.

The review still has a section on the international sanctions against the Russian energy sector. The most important events that affected the situation in the fuel and energy sector according to the experts have been the 47th session of the World Economic Forum in Davos on Jan 17-20, the Seventh IEA-IEF-OPEC Symposium on Energy Outlooks in Riyadh (February 15), the International Forum "The Arctic. Territory of Dialog" in Arkhangelsk (January 29-30).

For more details, see the review Changes and Trends in the Fuel and Energy Sector Regulation in Russia and the World: Q1 2017.

As per tradition, the EY Moscow Oil & Gas Center took part in preparing the Review.

For other reviews see Publications.