Energijos Skirstymo Operatorius AB
Notification on material event
On Setting the Upper Limit of AB “Energijos skirstymo operatorius” Income of the Natural Gas Distribution Service for 2020
AB “Energijos skirstymo operatorius” (hereinafter the Company), code 304151376, registered office address Aguonų Str. 24, Vilnius. The total number of registered ordinary shares issued by AB “Energijos skirstymo operatorius” is 894,630,333; ISIN code LT0000130023.
On 31 October 2019, the National Energy Regulation Council (hereinafter the Council) set the upper limit for income from natural gas distribution that will be valid in 2020: EUR 36,965,476 (in 2019, the upper limit for income comprised EUR 36,465,031).
The increase of the upper limit for income from the natural gas distribution service is caused by the provisions of the Law on Special Land Use Conditions, which will come into force on 1 January 2020 and provide for an obligation to register special land use conditions in cases where the Company’s plants that are necessary for natural gas distribution activities are installed in land plots. In addition, the upper limit for income from the distribution services increases because of the increasing regulatory assets base, whose growth in recent years was caused to a significant degree by increasing investments into connecting new consumers and by changes in macroeconomic indicators (wage growth and growth of the index of consumer prices), which are taken into consideration when allowable operating costs of the Company are set every year.
However, the increase of the upper limit for income from the natural gas distribution service is moderate because a part of the return on investments made from 2014 to 2018, if it exceeds the amount set by the regulator, is returned. A large part of the excess formed because of increased efficiency of the Company’s activities (wage costs and operating costs were lower than the ones set by the regulator).
The board of the Company, by taking into account the set upper income limit, will soon decide on specific natural gas distribution prices that will be valid from 1 January 2020. Specific prices, according to the procedure and deadlines provided for in the legislation, will be submitted to the Council for approval.
Tomas Kavaliauskas, Public Relations Officer at ESO, email: email@example.com, tel.: +370 61751616