OREANDA-NEWS. April 27, 2010. A meeting of the Expert Council of the Federal Antimonopoly Service (FAS Russia) on Electric Power Industry took place, reported the press-centre of FAS Russia.

As part of its efforts on increasing transparency of the work of the antimonopoly authority, FAS Russia developed draft documents and concepts that were discussed by the Expert Council.

FAS Russia developed draft recommended practice for revealing the fact of manipulating prices for electric power on the wholesale market of electric energy (power) based on the knowledge and experience accumulated through investigating antimonopoly cases in 2009-2010 on price manipulations on the wholesale electric energy (power) market. Practical application of direct provisions of the law on electric power industry resulted in more clear criteria for assessment of economic feasibility of price bids filed by participants of the day-ahead market and balancing market.

In particular, assessing economic feasibility of price bids when investigating cases, FAS Russia assessed and compared:

- prices indicated by participants of the wholesale market in their price bids with their actual costs of generation of eclectic energy in a particular hour;

- output indicated by the market agents with possible output of power stations based on technical specification of generating equipment, heating load restrictions, fuel provision;

- with the level of maximum economically feasible costs of generation of electric energy (without considering electrical capacity) differentiated with respect to the types of power stations, determined by the federal executive body on tariff regulation;

- prices for electric energy on the relevant markets and/or in comparable conditions.

At the same time the criterion of comparison with the level of maximum economically feasible costs of generation of electric energy (without considering electrical capacity) differentiated with respect to the types of power stations, determined by the federal executive body on tariff regulation, cannot be used correctly because those levels were established by No. 350-e Order of FST Russia of 28th December 2007.

Since then the costs level has not been reconsidered and currently it fails to a considerable extent to reflect economic reality and the relevant producers' costs. For instance, the approved tariffs to nuclear stations for 2009-2010 exceed the level of maximum economically feasible costs of electric power production, approved by the FTS Russia.

The Expert Council decided to form a Working Group in order to adjust them in line with modern economic conditions of the industry.

The second item of the agenda of the Expert Council was the concept of analysis of economic concentration of suppliers in free power transfer zones (groups of zones) to ensure competitive power take-off.

This project was completed by FAS Russia to execute No.89 Decree of the Government of the Russian Federation of 24th February 2010, which determined the main parameters for functioning of the power market and competitive power take-offs.

In view of importance of correct organization of competitive power take-offs, especially the first competitive power take-off in 2010, FAS Rossi is put in charge of preliminary analysis of the state of competition in free power transfer zones, where competitive power take-off will take place. It is necessary to clarify the level of economic concentration of power suppliers in these zones and to make a decision on introducing the price limit for power in those zones where competition is strongly restricted.