As a result of the possible closure of the business, the state budget will lose UAH 0.7 billion in tax revenues and about $150 million in foreign exchange revenues.
Part of the group Metinvest The Ingulets Mining and Processing Plant (InGOK) may completely cease operation due to the decision of the Cabinet of Ministers, according to which guarantees of electricity supply will be given only to enterprises that import 80% of their need. Forbes Ukraine reported this on Tuesday, June 11.
function news4693413() {
$.get(‘//’ + window.location.host + ‘/ajax/module.aspx?spm_id=444&id=4693413&lang=2&IsAjax=true’, function (data) { $(‘#nk4693413’).html(data); });
}
news4693413();
The editors received a letter from the director of InGOK, Igor Tonev, to Prime Minister Denis Shmygal and several chairmen of committees of the Verkhovna Rada. It stated that on May 30, the government decided to raise the previous standard of imported electricity from 30% from May to September and 50% from October to April to 80%. At the same time, the officials did not have a proper discussion or discussion with businesses, which deprived consumers of the opportunity to express their comments and suggestions.
“Increasing the rate of purchase of imported electrical energy to 80% of total demand stimulates an artificial increase in demand in auctions for the distribution of interstate connections and leads to a speculative increase in price for imported electrical energy to industrial enterprises,” the letter said.
Tonev draws attention to the fact that in Ingulets GOK, electricity costs account for 51% of the cost of production of steel raw materials. Therefore, the increase in the cost of electricity may affect InGOK’s competitiveness in the international market.
“The purchase of imported electrical energy in the amount of 80% of domestic consumption becomes unattainable due to high prices and may lead to complete shutdown of the plant Just because of the closure of one PrJSC InGOK, the fall of Ukraine’s GDP in the amount of UAH 4 billion Also, the budget will lose UAH 0.7 billion in tax revenues and about $150 million in foreign exchange revenues,” said the head of the plant.
In turn, stopping the production of iron ore products will lead to a decrease in the volume of both rail and sea transportation, as well as a decrease in demand for engineering products. This can cause a chain reaction that will negatively affect related sectors of the economy and worsen the economic crisis.
To avoid this, the Ingulets Mining and Processing Plant called on the government to return to the conditions for guaranteeing energy supply (30% from May to September or 50% from October to April), or to adjust the import rate to 50 % throughout the year.
As is known, the Cabinet of Ministers adopted amendments to the resolution stating that any industrial facility must import 80% of the electricity for its needs. Ukrainergo for its part the industry is guaranteed another 20%. Meanwhile, business representatives called on the authorities to reconsider this decision.
We remind you that from June 1, 2024, the Cabinet of Ministers significantly increased electricity bills for the population – up to 4.32 UAH/kWh. At the same time, Ukraine increased the maximum price of electricity for businesses.
Source: korrespondent
I’m Liza Grey, an experienced news writer and author at the Buna Times. I specialize in writing about economic issues, with a focus on uncovering stories that have a positive impact on society. With over seven years of experience in the news industry, I am highly knowledgeable about current events and the ways in which they affect our daily lives.