Buying DTEK two power companies will not affect the power distribution market, – investanalitik

Покупка ДТЭК двух облэнерго никак не повлияет на рынок распределения электроэнергии, - инвестаналитик

Head of analytical Department of investment company Concorde Capital Oleksandr Parashchiy believes that the acquisition of DTEK group companies Odessaoblenergo and Kyivoblenergo does not threaten monopolization of the national market of electricity distribution

He wrote about this in the author’s material on the website, reported Ukrainian news.

“Buying a major player in the two companies’ service networks will not affect the power distribution market, which today is composed of 34 mini-monopolies. And it does not matter to whom these mini-monopolies belong,” he said.

Steam believes that each of the power companies is a natural monopoly, therefore artificially duplicate its function is not economically feasible.

“It is worth noting that the company’s power distribution (oblenergos) are themselves little monopolies. Having owned electrical network in a certain area, they are the ones who physically transmits electricity from the producer (or the state of the owner of the high-voltage line) to the end user. Duplicate the functions of a company that is to build another one parallel to the grid, makes no sense. Therefore, regional power is a natural monopoly. But the monopoly of the only electricity transmission”, — says investanalitik.

No threats of abuse of a natural monopoly due to the prohibition of the distribution companies (power companies) engage in the sale of electricity.

“The fact that, by law, to transfer by wire of electricity and sell it to the end user are one and the same company cannot. The owner of electric networks is prohibited by law to sell electricity to the final consumer. In other words, by law, the owner of the grid (power companies) must only be a courier that physically delivers electricity to your apartment,” — says para.

As reported, on April 25 the Antimonopoly Committee allowed the company “DTEK oil & gas” buy shares “Kievoblenergo” and “Odessaoblenergo”, which belonged to the Dutch company VS Energy. According to the results conducted by the AMC analysis and taking into account the positions of the regulator, line ministries, market participants and research institutions, the Committee came to the conclusion that this concentration does not lead to monopolization or substantial restriction of competition on the commodity markets.

According to media reports, the ultimate beneficiaries of VS Energy are the Russian entrepreneurs Alexander Babakov, Evgeny Giner and Mikhail Voevodin.