Svirkov, S.A. The “last mile” contract: legal nature and general characteristics

Abstract: The article includes analysis of specific features and legal nature of one of the most controversial contractual constructions in the modern electric energy industry, which is the «last mile» contract. The key prerequisite to its appearance was the existing lack of balance in the price regulation of the electric energy sphere, when the tariffs, which are set by the state for the electric distribution network companies, are considerably different from the tariffs for the mainstream network companies. Additionally, the application of the financial and economic model, for which this contract provides, is aimed to improve the financial position of the distribution network companies. At the same time the right of organizations to conclude the «last mile» contracts is not beneficial for the customers, since they have to pay the higher tariffs for the electric energy. In this article the author provides a critical evaluation of this contractual construction, and he also notes that in the absence of the legislative legitimacy these relations may become an object for the anti-monopoly regulation. At the same time, the author comes to a conclusion that such contracts may be regarded as a form of abuse of right.

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