Economy 14:34 07/04/2014

Azerbaijan is among countries that sell gas and electricity to their populations at the highest prices

The government of Azerbaijan has all the chances to minimize utility costs of the citizens, however, Azerbaijan is among the countries that sell gas and electricity to its population at the highest prices, the article in the Azerbaijani news portal "Minval.az" reads.

As the article reads, Azerbaijan that extracts gas sells the natural gas to its population by 100 manats ($ 128) per 1000 m3 - that is 2-3 times more expensive than the cost price. According to the report of the State Oil Company in 2012 the cost price of gas was 44 manats ($ 56) per 1000 m3. In 2011 it was 39.5 manats ($ 50).

One cubic meter of gas, which costs 5.6 cents, is sold to the population of the country for 13 cents. "If we comparing this figure with the figures of European countries that buy 1000 m3 of gas for $ 350-460, we will see that the government is robbing its population," the author writes.

As for the power rates, the author notes that the cost of 1 kWh is 3-4 kopecks (3.8 - 5 cents) in Azerbaijan. The population of the country, however, has it for 6 kopecks (7.6 cents).

"Increase of energy prices in the near future seems inevitable, because the State Oil Company has increased the price of "Azerenergy" gas to 80 manats ($ 127 - approx. Eds.). As a result the cost price of electricity increased," the article reads.

At the same time, the author notes that if the minimum wage in Azerbaijan is 105 manats ($ 134), then in Denmark it is 2700 manats ($ 3460). In this country, the minimum income is about 25 times bigger, while utility rates only 5-9 times bigger.

The article notes that, according to the Azerbaijani State Statistics Committee, citizens spend 65-70% of their income on food. These data suggest that the lion's share of the average monthly salary of the citizens is spent on food, and only a small part of it is spent on social issues. According to international standards, a country in which 35% of the family budget is spent on food is below the poverty line.

That is to say, each citizen in order to improve his living conditions, to get treatment and receive education as well as to meet its needs for non-food products has to reduce the food expenses. Low incomes and high cost of utilities allow the population to have minimum energy consumptions.

As the author notes, the minimum consumer basket presented by the Azerbaijani government has serious flaws.

"The Azerbaijani basket is designed in accordance with Russian standards. It should be stressed here that in Russia they do not use gas and electricity for heating the apartments in winter. Moreover, the heat supply is good in apartments. Therefore, the minimum consumption of gas and electricity in this country is respectively 50 kWh and 10 m3. While in Azerbaijan energy consumption by population in winter exceeds the norm for many times," the material reads.



Source Panorama.am
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