Serhiy TULUB: Consumers Will Pay Monopoly Prices for Lights A nd Heat this Winter

On June 26 President Leonid Kuchma signed a decree on accepting the resignation of Serhiy Tulub as minister for fuel and energy. The Day ’s correspondent met Mr. Tulub to gain first-hand information about why the former minister offered his resignation and what he was going to do now.

“It must be more pleasant to hand in your resignation, as if slamming the door, than to be dismissed for poor work?”

“I want to stress in this connection: aged 46 and having 28 years seniority, I have never been fired for poor work or had any problems with law-enforcement bodies, unlike those who have been stained by unclean partners and buddies and are now trying to put others under a shadow.

“My work at the Ministry of Fuel and Energy was first of all aimed at overcoming the crisis, carrying out market transformations in the energy sector, and ensuring economic growth in Ukraine. And we managed to achieve something. Coal production is growing steadily. Deliveries of power-generation coal to thermal electric stations increased by 2.4 million tons over last year. This made it possible to organize the uninterrupted supply of electricity in the winter. Nuclear power plant workers had their many months of back wages and salaries paid. We began paying off arrears to thermal station workers. Revenues from the energy consumed have risen by almost 2.5 times. We have also solved the problem of the additional funding of the coal industry at the expense of the state budget.

“In other words, we began to solve in practice the pivotal and most painful problems of energy sector enterprises. We drew up a specific program of managing the crisis and setting in motion the mechanisms for upgrading the fuel-and-energy complex.

“However, I got no support from the Cabinet of Ministers leadership. Instead, they would level accusations of promoting the interests of some clans. But whose interests did the Ministry for Fuel and Energy serve, when it mobilized in a matter of days last winter all possible resources to ward off the collapse of Ukraine’s united power-supply system? In spite of everything, we did manage to preserve the system, although we inherited almost empty fuel depots at thermal and nuclear power plants.

“The ministry repeatedly demanded that the government increase state support of the coal industry, keep the miners’ jobs intact, and pay off back wages. These proposals were ignored for months, which resulted in growing social tension in the cities and villages where miners live. Cabinet leaders saw this but did nothing. The problem was solved only when the President of Ukraine intervened.”

“Ukraine is now facing a disaster, not just an energy crisis. What has led to this?”

“The government did not consider or even intentionally obstructed the ministry’s draft resolutions and proposals on improving the legal standards for fuel and energy enterprises. Decisions on top staff appointment in the ministry’s most important departments were delayed by almost five months.

“This is why today, in the heat of summer, we have to work in a winter regime, i.e., when the energy system is unbalanced, the power supply is periodically cut off, and fuel reserves are being exhausted. As early as in the coming fall and winter, consumers and the state’s economy will have to pay high monopoly prices for light and heat. Some elements, highly ‘experienced’ in this business, just lie in waiting for the H-hour. I repeatedly informed top Cabinet officials about this, but this only enhanced the aggressive atmosphere artificially created around me and the ministry. As a result, I had to resign.”

“Some other top-level officials were deprived, along with you, of their posts. Is it possible to find a reliable replacement for them?”

“There are no irreplaceable people, as the old saying goes. But whoever snubs professionals will have to deal with dilettantes, so numerous in the current government. The Cabinet’s so-called cadre policy is lame in both legs. Ihor Bakai, president of Naftohaz Ukrayiny; Serhiy Tyhypko, Economy Minister; and Ihor Didenko, acting president of Naftohaz, had to resign one after another. These are widely- experienced and high-skilled experts. They all quit, thus expressing their categorical disagreement with actions of the current Cabinet leadership.

“That Mr. Tyhypko and Mr. Bakai were immediately elected to parliament undoubtedly testifies not only to their flexible mind and ability to manage the situation but also to confidence in them on the part of voters who look upon these people, for a good reason, as the future of Ukraine. And what the government has done to these people seems to be the deliberate ruining, if not rout, of the fuel-and-energy complex.”

“What are your plans?”

“I would like to calm both friends and foes. There is no end of work to be done. I did not ascend to a high ministerial post after working in a dubious business, where you can launder in a flash millions and billions under favorable conditions if you are not burdened with a sensitive conscience. Before becoming a member of the Cabinet of Ministers, I was handler in a mine, mining foreman, assistant duty engineer, chief engineer and manager of a mine, general manager of a holding company, and deputy chairman of the Donetsk oblast state administration. I say this to stress the simple truth: experience can be gained only in due time and by hard work. There still are people among us who can judge things right and find a way to put this experience to use. Of course, to catch fat carp in troubled waters also takes experience, specific experience that can serve the interests of the pocket, not the state.”

“What major plans did you fail to implement while minister?”

“This is what saddens me most. With brilliant experts in the ministry, we still failed to get approved at the governmental level an integrated program of reforming and upgrading the fuel and energy complex. But this is not our fault. Suffice it to recall that ministry experts had to remake 37 times, on demand of the Cabinet leadership, the draft government program On Streamlining Relations on the Wholesale Market of Electrical Energy. But even the last version was rejected. This makes me think the delay was intentional. Today, every day and every hour is precious: we must stock up on coal, fuel oil, gas, and fresh nuclear fuel for nuclear power plants. Instead, we’ve been drawn into fruitless debates and endless meetings.”

“Prime Minister Viktor Yushchenko, commenting on the current state of affairs in the national fuel-and-energy complex, noted that these problems have not arisen today, that they have been accumulating for years. So the blame should be put not only on the current but also on all the previous governments. You don’t seem to agree with this.”

“Quite the contrary, I agree with this viewpoint. I only want to draw your attention to the following detail: all those who put the fuel and energy complex on the rocks yesterday are still up and around. Only now they sit in more comfortable and less responsible chairs of various assistants, advisers, and managers, serving the Cabinet leaders.

“It is cynicism and hypocrisy, when those who ruined the state’s energy strength with their own hands are still pointing a finger at us today.”

“Do you feel pessimistic now that you are leaving your office?”

“No, for I know these evil times will also pass. For however heavy and black a cloud may be, it always has a silver lining. And I never lose a belief in Ukraine’s bright future. Seizing this opportunity, I want to warmly thank all my colleagues for fruitful cooperation and constant support.”