YEREVAN (Combined Sources)—The Armenian government has selected Deloitte & Touche to determine whether a decision by Armenia’s Public Services Regulatory Commission (PSRC) to allow Armenia’s national power distribution company to raise electricity price was economically justified or resulted from alleged corruption and mismanagement.
Deputy Prime Minister Vache Gabrielyan said that the government had sent requests to top international consulting companies to take part in a tender that would select one of them to conduct a probe of the Electricity Networks of Armenia (ENA). Two firms—McKinsey and Deloitte & Touche—responded to the request. Deloitte & Touche was chosen because they reportedly offered a lower commission price for their service.
“Deloitte and Touche is an internationally renowned company, and I think that after their conclusions we will have sufficient grounds to move forward,” Prime Minister Hovik Abrahamian said at a weekly cabinet meeting in Yerevan.
The decision to conduct an audit of the company was reached on June 26 during President Serzh Sarkissian’s meeting in Yerevan with Russian transport minister Maxim Sokolov, the Russian co-chairman of the joint Armenian-Russian intergovernmental commission on economic cooperation. The following day, Sarkissian said the government will keep electricity prices unchanged for consumers by subsidizing their increased cost at least until the release of findings of a future audit.
Earlier, Sarkissian said that an audit would find out whether the price hike approved by state regulators was economically justified or resulted from alleged corruption and mismanagement in the ENA.
The government has yet to select a foreign consulting firm that will conduct the audit. Abrahamyan said on Thursday that it is still negotiating with “the Russian side” on the matter.
The PSRC’s decision on June 17 to increase the electricity price for consumers by 6.93 drams (16.7%) sparked a vigorous public backlash and street protests against the increase.