Minister targets gas companies

  • 2005-01-12
  • From wire reports
VILNIUS - Economy Minister Viktor Uspaskich urged the government to curb profits from gas imports and Lietuvos Dujos (Lithuanian Gas), the distribution monopoly, to 7 percent and earmark surplus earnings for cutting gas prices in the future years.

"We hope to get the support of Prime Minister Algirdas Brazauskas and other ruling coalition partners, who also claimed in their elections programs that the prices of electricity and gas should be regulated," Uspaskich, founder and leader of the populist Labor Party, told the Lietuvos Rytas daily. "An implementation of this project would trigger a chain reaction, and the prices of gas for heating producers will decline, and they will find themselves in a position to cut the heating tariffs."

"These companies are monopolistic organizations that operate almost without any risks. So the return on capital should not exceed the average yield on securities or the interest rates established by banks. In the opinion of experts from the World Bank and the European Bank for Reconstruction and Development, the return on nonrisk capital on our market should be 8 percent, and risk capital - 15-16 percent," the minister pointed out.