MOSENERGO plans to raise power payment rates at the beginning of February. MOSENERGO's Planning and Economics department head A. Rayev announced this today at a briefing. Rates will be raised in order to catch up with price increases for natural gas, rate hikes in rent for using Russian UES networks, mounting expenses for material resources and increasing power consumption in Moscow and Moscow region.

Current power rates are .5 rubles per kWh for customers using gas stoves and .35 rubles per kWh for those with electric stoves. In the Moscow region these figures are .38 and .27 rubles respectively. The company plans to increase power rates by about 25 percent with the city rates reaching the level of .65 to .45 rubles per kWh and regional ones-approximately .50 to .35 rubles per kWh.

MOSENERGO has anticipated the looming increase by compiling a list of preferential customers that will receive discounts. Among them are targeted social groups, agricultural enterprises and Moscow region budget-funded entities. According to some preliminary estimates, the average discount rate will be .45 rubles for kWh.

Increasing power rates by 25 percent will enable the company to invest 4.2 billion rubles into renewing its production equipment. However, the amount obtained through the coming rise will cover the renewal of only .6 percent of MOSENERGO's capacities. Rayev said, "To perform the renewal of the 3 percent of our capacities, we would need to raise power rates by 40 percent.

"We realize that the rate increases are painful for our customers. But this is a step that we must take because of external factors. Heat and energy prices are determined by the prices of their components: fuel, disposable materials, rent payments to Russian UES as well as other factors. If we always want to have heat and power in our homes then we have to make up for the increases in their component prices," Rayev said.