“Do the Armenian authorities raise the issue of effective management of the Electric Networks of Armenia (ENA)?” This question is important to understand why and by how much electricity rate in Armenia is to increase, economic journalist Hayk Gevorgyan said during a press conference on Friday, June 19.
“It goes way back to the story of how ENA was privitized in 2001. What I`m about to say will sound absurd: in the tender for the privatization of ENA, world-famous French electric utility company EDF [Électricité de France], which has an annual turnover of more than the budget of Armenia for 30 years, was interested in buying the company. On the other hand, there was Midland Resources, a company registered in the offshore, with an annual turnover of 130 million dollars,” the journalist said.
In 2002, Gevorgyan pointed out, the Armenian authorities sold Electric Networks of Armenia to Midland Resources, which was only an intermediary, and subsequently sold 100% of its shares to the Russian “Inter RAO UES.”
“Has the [Armenian] government raised the issue of handing over ENA to an effective manager? Obviously not. As long as the ENA is ineffective, the issue of raising the electricity rate will always be of concern,” he said.
Electric Networks of Armenia, as stated by the journalist, has an annual profit of USD 0,5 billion, of which 12% (USD 60 million) is lost. In the case of the ENA, technical losses amount to about 3-5%; the rest is pocketed by the managers of the company, Gevorgyan concluded.
Electricity Rate in Armenia Will Go Up as National Utility Is Managed Ineffectively
19 June 2015
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