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KARABAKH'S ENERGY CRUNCH
By Lusine Musaelian
Institute for War and Peace Reporting
May 22 2008
UK
Government unveils long-term energy plans, but public is angered by
rising gas prices.
Raisa Gabrielian, who lives in Stepanakert, the capital of Nagorny
Karabakh, tries not to think about next winter. Her monthly salary
of 65,000 drams, or 210 dollars, is the only income for her family
of four. Now that the price of gas is going up, she says, the money
will only cover basic household expenses.
>From June 4, the price of gas in Nagorny Karabakh will rise from
59 to 84 US cents per cubic metre. Although the government of the
unrecognised republic is planning to diversify its energy sources to
make the region less reliant on gas imported from Armenia, the steep
price hike will hurt the population in the short term. For ordinary
consumers, gas will now cost nearly three times as much as in Armenia.
Artsakhgaz, the region's gas supplier, announced the price rise on
May 1, but failed to inform the Nagorny Karabakh government commission
that regulates public utilities.
The director of Artsakhgaz, Maksim Mirzoyan, told IWPR that the
price increase was a result of the ending of government subsidies -
a process that parallels what the authorities in Armenia have done -
rather than because of the international price of gas.
After Artsakhgaz's announcement, taxi-drivers in the local capital
Stepanakert, who run their cars on compressed natural gas, raised
fares from 100 to 120 drams per kilometre, with the minimum cost of
a ride going from 500 to 600 drams.
Vache Adamian, who chairs the public utilities commission, said the
far rises were "patently illegal" as taxi drivers had not in fact
been hit by any price rise.
He added, "Taxi services are not yet under our control and we can't
intervene."
Stepanakert resident Vardges Babayan said there was little people
could do about the taxi fares.
"I know I'm paying this money for no good reason, but there's nothing I
can do," said Babayan. "Who can you complain to that you're being made
a fool of? They'll just say that they are a private [taxi] business
and that if you don't want to pay the money, don't get in the car."
Above a set volume, bulk consumers of gas will continue paying the
old price, but domestic users, taxi drivers and the like do not use
enough to qualify for the reduction.
Artyusha Karapetian owns a shop selling household goods in
Stepanakert, and predicts that his customers will become less keen
on gas appliances.
"Gas stoves used to be a very popular product," said Karapetian. "But
after the price rises, people will probably stop heating their
apartments with gas."
Gas is the commonest fuel used for heating in Nagorny Karabakh,
which has been isolated from the outside world and can only be
reached Armenia since the end of the war in 1994. Around 70 per
cent of the population use gas, with the rest who tend to live in
the more remote villages mainly heating their homes with firewood,
which is widely available.
To make Nagorny Karabakh more self-sufficient, prime minister Ara
Harutiunian has announced plans to compensate citizens and to exploit
other sources of energy.
"The government will try to ease the burden on gas consumers with some
kind of compensation," he said. "In the future, gas will no longer
be the main energy source for Karabakhis. Over the next few years,
we will become a country that produces its own energy, allowing us to
sell electricity to our citizens at a reduced price and also perhaps
to neighbouring countries, thereby circumventing the rise in gas
prices on the international market."
On May 13, Harutiunian announced that the Mataghis reservoir, located
in the north of Nagorny Karabakh and currently in a very poor state
of repair, had been handed over to the Artsakhges company, which will
construct a series of five small hydroelectric power stations over
the next two to three years. The intention is the power stations will
provide for all of Nagorny Karabakh's energy needs.
In the meantime, other products are also becoming more expensive.
Prime Minister Harutiunian said this was good news for Karabakh
farmers. "We are an agricultural country but we often hear complaints
from farmers that they cannot sell their crops at a reasonable price
and aren't earning a profit," he said. "Because of the price rises,
our farmers are now pleased with the results of their work."
Seventy-year-old pensioner Karo Gevorgian is furious.
"How can I be happy? What are they doing with people?" he asked. "They
put up the pension by a tiny amount and everything else has become
many times more expensive. How can I live like this? They are driving
people to their graves."
Lusine Musaelian is a correspondent for Demo newspaper in Nagorny
Karabakh and a member of IWPR's Cross Caucasus Journalism Network
project.
By Lusine Musaelian
Institute for War and Peace Reporting
May 22 2008
UK
Government unveils long-term energy plans, but public is angered by
rising gas prices.
Raisa Gabrielian, who lives in Stepanakert, the capital of Nagorny
Karabakh, tries not to think about next winter. Her monthly salary
of 65,000 drams, or 210 dollars, is the only income for her family
of four. Now that the price of gas is going up, she says, the money
will only cover basic household expenses.
>From June 4, the price of gas in Nagorny Karabakh will rise from
59 to 84 US cents per cubic metre. Although the government of the
unrecognised republic is planning to diversify its energy sources to
make the region less reliant on gas imported from Armenia, the steep
price hike will hurt the population in the short term. For ordinary
consumers, gas will now cost nearly three times as much as in Armenia.
Artsakhgaz, the region's gas supplier, announced the price rise on
May 1, but failed to inform the Nagorny Karabakh government commission
that regulates public utilities.
The director of Artsakhgaz, Maksim Mirzoyan, told IWPR that the
price increase was a result of the ending of government subsidies -
a process that parallels what the authorities in Armenia have done -
rather than because of the international price of gas.
After Artsakhgaz's announcement, taxi-drivers in the local capital
Stepanakert, who run their cars on compressed natural gas, raised
fares from 100 to 120 drams per kilometre, with the minimum cost of
a ride going from 500 to 600 drams.
Vache Adamian, who chairs the public utilities commission, said the
far rises were "patently illegal" as taxi drivers had not in fact
been hit by any price rise.
He added, "Taxi services are not yet under our control and we can't
intervene."
Stepanakert resident Vardges Babayan said there was little people
could do about the taxi fares.
"I know I'm paying this money for no good reason, but there's nothing I
can do," said Babayan. "Who can you complain to that you're being made
a fool of? They'll just say that they are a private [taxi] business
and that if you don't want to pay the money, don't get in the car."
Above a set volume, bulk consumers of gas will continue paying the
old price, but domestic users, taxi drivers and the like do not use
enough to qualify for the reduction.
Artyusha Karapetian owns a shop selling household goods in
Stepanakert, and predicts that his customers will become less keen
on gas appliances.
"Gas stoves used to be a very popular product," said Karapetian. "But
after the price rises, people will probably stop heating their
apartments with gas."
Gas is the commonest fuel used for heating in Nagorny Karabakh,
which has been isolated from the outside world and can only be
reached Armenia since the end of the war in 1994. Around 70 per
cent of the population use gas, with the rest who tend to live in
the more remote villages mainly heating their homes with firewood,
which is widely available.
To make Nagorny Karabakh more self-sufficient, prime minister Ara
Harutiunian has announced plans to compensate citizens and to exploit
other sources of energy.
"The government will try to ease the burden on gas consumers with some
kind of compensation," he said. "In the future, gas will no longer
be the main energy source for Karabakhis. Over the next few years,
we will become a country that produces its own energy, allowing us to
sell electricity to our citizens at a reduced price and also perhaps
to neighbouring countries, thereby circumventing the rise in gas
prices on the international market."
On May 13, Harutiunian announced that the Mataghis reservoir, located
in the north of Nagorny Karabakh and currently in a very poor state
of repair, had been handed over to the Artsakhges company, which will
construct a series of five small hydroelectric power stations over
the next two to three years. The intention is the power stations will
provide for all of Nagorny Karabakh's energy needs.
In the meantime, other products are also becoming more expensive.
Prime Minister Harutiunian said this was good news for Karabakh
farmers. "We are an agricultural country but we often hear complaints
from farmers that they cannot sell their crops at a reasonable price
and aren't earning a profit," he said. "Because of the price rises,
our farmers are now pleased with the results of their work."
Seventy-year-old pensioner Karo Gevorgian is furious.
"How can I be happy? What are they doing with people?" he asked. "They
put up the pension by a tiny amount and everything else has become
many times more expensive. How can I live like this? They are driving
people to their graves."
Lusine Musaelian is a correspondent for Demo newspaper in Nagorny
Karabakh and a member of IWPR's Cross Caucasus Journalism Network
project.