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The current Russian system of tariff regulation "Costs plus" does not look after investors' interests. This is why the grid companies have been for some years combatting for the transition to the European system of tariff calculation, RAB-regulation, which should give the sector the much needed investment charge.
English RAB-regulation technique (Eng. for "Regulatory Asset Base") and the "Costs plus" system differ in the following:
tariff for the transmission of electricity which includes investment costs is approved by the tariff body every year. This is why investors cannot plan their revenues and costs for several years ahead. The new mechanism plans the establishment of the grid payments for three years initially and for five years in the future.
RAB-tariff includes return of invested resources and a certain interest rate for the investor. Not only the proprietor of the grid can act as an investor here, this can be any lender, a bank for instance, or a nongovernmental pension fund to which the grid company will make payments toward the capital and interest, much like a mortgage, for 30-35 years (the so called "energy sector mortgage").
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