The extended conference on the fuel-and-energy complex, held last Thursday with President Leonid Kuchma chairing, can be undoubtedly called the culmination of the energy situation in Ukraine.
The government, which has been lately talking so much about clean hands and clean energy, got under the cold shower that will keep it from unnecessary talks and encourage making the concrete long-awaited decisions. It is not accidental that the President began his speech with stating that this country’s power sector works at the limit of its physical capacities even now, in a warm season.
The President made a thorough, tough, and unambiguous analysis. The government’s attempts to influence the energy situation in this country have been unsuccessful. Which, as the President said, is ‘’the sign of weakness’’ and absence of the sense of responsibility. Mr. Kuchma stressed some people have forgotten the latter word.
This statement was accompanied throughout his speech with what seemed to be endless illustrations of the most important, rather than minor and secondary, problems that have ‘’short-circuited’’ the Ukrainian power sector, one of the corner stones of this country’s economy. In particular, reference was made to the power-generation program, Ukraine-2000, fulfilled by a mere 10%. As to a new similar program, the government has not even considered one.
Putting himself over and above the energy battle, in which various oligarchic groupings are engaged, according to The Day ’s experts, the President gave an unequivocal answer to those who try to push through the already compromised approaches under the guise of being concerned about order on the energy market. For instance, he subjected to criticism the idea of direct power-supply agreements between the power-generating and power-transmitting companies, noting they cannot be effective. The danger of these deals lies, in his opinion, in that they in fact ‘’legitimize’’ barter- and promissory-note-based settlements. He cited, as an example of the criminal activity of ‘’high-ranking profiteers,’’ the disappearance of $3-billion-worth fuel for nuclear power plants, received as payment for the nuclear weapons moved to Russia. And although questions of the ‘’Where was the ministry of finance?’’ type could only be addressed to the old government, the conclusion — ‘’if the government does not defend state interests, we are all worth a brass farthing’’ — was interpreted as a warning to the current ministers who have been so carried away by energy market reforms that put the whole matter in a deadlock.
At the same time, the President pointed out that the experiment in Donetsk and Dnipropetrovsk about greater participation of the oblast administrations in energy management was not continued to the end through the government’s fault. Meanwhile, intermediaries from Kyiv ‘’carry everything away from Donbas coal basin,’’ to quote the President’s phrase, while the ministry of economics has withdrawn from controlling such processes.
Mr. Kuchma also drew the government’s attention to energy conservation which becomes, in the current conditions, the state’s most important task. However, in his opinion, no governmental activity in these matters is so far in sight. Per-capita spending of energy in Ukraine is 10 times as high as in the European Union. ‘’Will they admit us to Europe, with indicators like this?’’ Mr. Kuchma asked and chose not to answer, feeling that the audience was with him. Low competitiveness of Ukrainian industrial products also results, as Mr. Kuchma thinks, from the high cost of national coal, 40% up on that in Poland and Russia. Meanwhile, it is coal that has dominated this country’s energy balance lately, superseding nuclear and hydro-energy.
Yet, the retooling of Ukrainian coal mines has been in fact stopped. Not a single budgetary hryvnia is being earmarked for restoring the coal-pit potential. Nothing is being done to improve the quality of coal. ‘’Plain rock is being passed off as coal for our power plants,’’ Mr. Kuchma noted.
The President drew attention to the problems of miners who have only received from the consumers 46% of the extracted coal’s value. To revitalize this industry, UAH190 million is being allocated on Mr. Kuchma’s initiative, specifically for technical re-equipment: ‘’It is very important that this money not be squandered.’’ In his opinion, no new settlement schemes should be invented in the power sector, all we need is to put payments in order. ‘’New schemes,’’ the President said, ‘’lead to losses,’’ and many of those in the hall wanted at that moment to see the reaction of Yulia Tymoshenko... By Vitaly KNIAZHANSKY, The Day (See page 2)
