Demands from Ukrainian officials to transition the housing and utilities sector to fully market-based tariffs are detached from reality and directly contradict European experience. While local politicians insist on free-market pricing, the vast majority of EU countries actively protect their citizens from skyrocketing bills through large-scale state subsidies and tax incentives.
Utility expert Oleg Popenko discussed these issues during a live broadcast on February 18, according to Hvylya. He harshly criticized government representatives and grant-funded organizations promoting "shock therapy" tariff hikes, arguing they fundamentally misunderstand the mechanisms of Western economies.
According to the specialist, discussions about a free market in the Ukrainian heat and power system are meaningless and physically unfeasible under the current legislative framework. The expert noted that the initiators of such reforms have simply failed to study foreign experience.
"In Europe, only five countries have market prices for gas," Popenko emphasized. In all other states, the cost of energy resources, including those for district heating companies, is subsidized by authorities in one way or another.
To curb spikes in utility tariffs and prevent household debt, European governments utilize a full arsenal of economic tools: direct budget payments, compensation for price differences, and strategic tax cuts. As an example, the analyst cited a neighboring country where the financial burden on consumers is artificially lowered by the state.
"They have no VAT on property management services for residential buildings at all. The VAT for water utilities is 9%," the expert explained, referring to the Polish government's model.
He expressed regret that domestic reformers do not grasp this approach, stating that instead of protecting the population, they continue to promote "nonsense" while lobbying for uncontrolled price increases.
