Smart sub­si­dies

Kyiv Post Legal Quarterly - - Interview -

Ko­valiv says Naftogaz will cut sub­si­dies to con­sumers, but still give them to those who re­ally need help. In 2014 sub­sidy pay­outs to­taled Hr 110 bil­lion ($4.4 bil­lion) from both the state bud­get and the gas mo­nop­oly. In 2015 that fig­ure fell to Hr 43 bil­lion ($1.72 bil­lion), with Hr 25 bil­lion ($1 bil­lion) com­ing from the state bud­get and the rest from Naftogaz. In 2016 there will be no help com­ing from the state bud­get, and Naftogaz will pay Hr 40 bil­lion ($1.6 bil­lion) in sub­si­dies.

“We’re be­com­ing more ef­fi­cient in terms of what we sub­si­dize, and what’s more im­por­tant, to whom we give these sub­si­dies,” Ko­valiv said.

If Ukraine can hold gas prices at in­ter­na­tional lev­els, while in­vest­ing into ex­trac­tion and sus­tain­able en­ergy, Ko­valiv says Ukraine could be nearly en­ergy in­de­pen­dent by 2020.

“That means we won’t be im­port­ing gas, it means that we’ll have en­ergy se­cu­rity, and it means that gas won’t be a po­lit­i­cal is­sue,” Ko­valiv added.

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