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The Government of the Republic of Belarus (GoB) plans to increase district heating tariffs to cost-recovery levels and gradually phase out subsidies, replacing them with social assistance programs. Residential DH tariffs in Belarus are currently at roughly 10-21 percent of cost-recovery levels. DH subsidies are highly regressive, add costs to business, and create significant fiscal risks and macroeconomic vulnerabilities. The study analyzes the social, sectoral, and fiscal impacts of the proposed tariff reform, and identifies and recommends measures to mitigate adverse impacts of district heating tariff increases on the households. The analysis shows that a negative social impact is manageable if a tariff increase is accompanied by countervailing measures to compensate for the loss of purchasing power, in particular of the poor, through targeted social assistance and energy efficiency programs. The reform is more likely to be successful if communication campaigns to address consumer concerns are carried out before significant price increases, and consumer engagement and monitoring systems are established. When tariff reform and mitigation measures are properly sequenced and coordinated, the reform will become more socially acceptable, consumers will benefit from better quality of services, the government will achieve positive fiscal savings, and the DH sector will become sustainable in the long term. The study analyzes the social, sectoral, and fiscal impacts of the proposed district heating tariff reform in Belarus, and identifies and recommends measures to mitigate adverse impacts of district heating tariff increases on the households.

Tariff --- Heating --- Subsidies --- Government policy --- Business subsidies --- Corporate subsidies --- Corporate welfare --- Government subsidies --- Grants --- Subventions --- Vouchers (Subsidies) --- Welfare, Corporate --- Buildings --- Ad valorem tariff --- Border taxes --- Customs (Tariff) --- Customs duties --- Duties --- Fees, Import --- Import controls --- Import fees --- Tariff on raw materials --- Heating and ventilation --- Government aid --- Foreign trade promotion --- Trade adjustment assistance --- Heat engineering --- Boilers --- Stoves --- Commercial policy --- Indirect taxation --- Revenue --- Customs administration --- Favored nation clause --- Non-tariff trade barriers --- Reciprocity (Commerce) --- Environmental engineering

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Economic policy and planning (general) --- Relation between energy and economics --- Armenia

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More than a decade of ambitious sector reform has led to a period of stability in the Armenian energy sector. The sector faces challenges more typical of a developed economy than an emerging one: policymakers' concerns have shifted from avoiding total system collapse to optimizing the energy supply mix to provide affordable, reliable, and sustainable energy services. However, some old challenges remain and new ones have arisen. Armenia is still vulnerable to energy supply disruptions; tariffs lag the full cost of service provision; and a significant investment backlog impedes progress in energy infrastructure. The purpose of this note is to present the analysis of the challenges facing Armenia's energy sector, specifically, its electricity, natural gas, and heating subsectors. The intention of the note is not to prescribe solutions, but to present analysis of options and tradeoffs that the Government can use to inform its decision-making. Armenia's energy sector has undergone a series of reforms over the last fifteen years, which included privatization of the electricity distribution and gas companies, and some generating companies, establishment of an independent regulator, and development of a formal strategic plan for the sector. This energy sector overview highlights important outcomes from reforms and describes key sector characteristics.

Bankruptcy --- Capital Costs --- Consumers --- Debt --- Elasticity of Demand --- Electricity --- Energy --- Energy and Environment --- Energy Consumption --- Energy Demand --- Energy Efficiency --- Energy Markets --- Energy Production and Transportation --- Energy Sector --- Energy Security --- Energy Supply --- Financial Crisis --- Fuel Prices --- Fuels --- Gdp --- Gross Domestic Product --- Hydropower

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This paper analyzes power utilities in 15 jurisdictions to understand the determinants of success for reforms aimed at improving financial viability and cost recovery in the power sector and the impacts of these reforms on metrics of sector performance. The analysis finds that electricity tariffs are rarely high enough to cover the full costs of service delivery, even where the cost of service is low, and that few countries adequately manage volatile costs and maintain cost recovery levels over time. Almost everywhere, power utilities often impose a substantial fiscal burden and contingent liabilities on government budgets. Over the past 30 years, cost recovery levels have increased on average, but progress has been uneven, with over half of the case study jurisdictions experiencing a decline compared with the pre-reform period. The record of reforms of price formation, especially tariff setting through regulatory agencies, is mixed. On average, countries that have made more progress on utility governance and decision making perform better on cost recovery. The paper concludes with proposed modifications to the conceptual framework underpinning the economic analysis of power sector reforms as well as immediate, practical implications for understanding cost recovery as part of the overall power sector reform agenda.

Access to Electricity --- Cost of Service Delivery --- Cost Recovery --- Electric Power --- Electric Utilities --- Electricity Pricing --- Electricity Subsidy --- Electricity Tariff --- Emerging Market Economies --- Energy --- Energy and Poverty Alleviation --- Energy Policies and Economics --- Energy Sector Regulation --- Power Sector --- Public Sector Development