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13 Oct 2023

Russia's Interrao Says China Agrees to Higher Electricity Price

13 Oct 2023  by reuters   
Russian energy group InterRAO (IRAO.MM) has agreed with China that Beijing will pay a higher price for its electricity to match a new export duty imposed by Moscow, InterRAO board member Alexandra Panina said on Thursday.

She said supplies would return to previous levels after Oct. 22, when a transmission line now under repair returns to operation.

State-owned InterRAO said last week it had started restricting electricity supplies to China while negotiating over the price increase. The agreement comes ahead of a visit to China by Russian President Vladimir Putin next week.

"We have reached an agreement with China. China raises the price of our contract by the amount of the export duty," Panina told reporters in Thursday.

She was referring to the new export duty linked to the rouble exchange rate that Russia introduced on a wide range of goods from Oct.1 to help tackle its budget deficit.

InterRAO, the monopoly exporter of electricity from Russia, said in September that it would raise prices by 7% for customers in some countries, including China, because of the new duty. It said it would limit, or cut off, supplies if customers refused to accept.

China bought a record 4.7 billion kilowatt-hours of electricity from Russia in 2022 and could become its second-biggest customer after Kazakhstan this year, after Russia halted power exports to Europe because of the conflict in Ukraine.

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