Electricity for households and other distribution consumers will certainly become more expensive in January, and by what percentage will be known by December 1st.
Until then, the Regulatory Agency for Energy and Regulated Utilities (REGAGEN) should respond to the request of the Montenegrin Electric Distribution System (CEDIS) to increase their item on the account, while by then Elektroprivreda should also decide whether and by how much it will increase the amount on its part. accounts.
Electricity is now cheaper than five years ago
In the last 12 years, the final price of a kilowatt hour for households with all items and tax has increased by 10,3 percent, mostly due to the increase in VAT from 17 to 21 percent. During this period, many items on the account were added, deleted or changed, so this did not significantly affect the final value. The price of a kilowatt hour with all items and tax, according to Monstat and Eurostat data, was 9,6 cents at the end of last year and was lower than in 2018 and 2019, when it was 10,2 and 10,3 cents.
CEDIS items make up about 20 percent of the total amount of the bill, so its increase by ten percent would affect the growth of the total amount of the bill by about two percent. Neither CEDIS nor REGAGEN wanted to tell the "News" how much the increase in this item was requested.
EPCG owns 45 percent of the bill, and it can increase its share even without the approval of the regulator, but it has not done so for four years, and at that time it was a symbolic change. The company told "Vijesta" that they are still analyzing the situation on international stock markets, and that this is a sensitive issue due to its economic and social impact.
EPCG: We respect the socio-economic environment
They stated that their part of the bill has not been increased even symbolically since 2019, and that the price on the stock exchange has meanwhile increased by over 100 percent.
"EPCG will make a possible decision on the increase after a detailed analysis of the production costs of electricity, but also taking into account the socio-economic environment of the end customers," the company stated.
Last year, CEDIS submitted a request to increase its item for 2023, but withdrew it at the request of the board of its owner EPCG. EPCG said at the time that the price increase would affect the standard of citizens, as well as the reduction of the level of collection. The then Minister of Capital Investments Ervin Ibrahimovic he also asked to increase the price of electricity, which the energy companies did not accept.
CEDIS's reasons for increasing prices was that, according to regulatory rules, to cover technical losses, they have to buy electricity on the stock exchange, which amounts to about 11 cents per kilowatt, and that they can get a refund of only about five cents from consumers. This resulted in multi-million dollar losses.
Last year, the Montenegrin Electric Transmission System (CGES) requested an increase in its item to cover technical losses on the network, which the regulator approved, but at the same time it reduced another item for that company because the company increased commercial revenues from the use of an underwater energy cable for Italy. CGES did not ask for an increase in its items now.
CEDIS submitted the documentation
CEDIS has now told "Vijesta" that in accordance with the Law on Energy and methodology, they have submitted a request to the Agency to determine the regulatory permitted income and prices for the use of the distribution system.
"CEDIS fulfilled its legally prescribed obligation and on August 30, 2023, submitted the Request and all the necessary documentation on the basis of which REGAGEN determines the regulatory permitted income and prices for the use of the network for the current regulatory period (2024-2025), with the beginning of application from 1. January 2024. "REGAGEN determines the regulatory revenue and prices for the use of the network, so CEDIS cannot influence REGAGEN's decision on the amount of approved regulatory revenue, and therefore not on the level of established prices, except for the part of the submission of documentation required by the Agency," the company stated.
They said that the valid prices for the use of the distribution network were determined by the decision of the Regulatory Agency from 2019.
They are looking for a balance between the interests of companies and consumers
REGAGEN informed "Vijesta" that the procedure for determining the regulatory allowed income and prices for the use of the electricity distribution system is underway as requested by CEDIS.
"The agency determines prices in accordance with the pre-established regulatory framework, which is based on the principle of balancing the interests of system operators and system users, and the principle of ensuring the sustainability of the operations of regulated entities that perform activities of public interest. "In the previous decade, price determination procedures sometimes resulted in a fall and sometimes an increase in regulated prices, depending on the arguments and evidence on the basis of which the Agency assessed the validity of the requirements of the regulated entities", stated the Regulatory Agency.
Mujović: If electricity becomes more expensive, part of EPCG's profit goes to help the poor
The new Minister of Energy and Mining, Saša Mujović, said yesterday in "Colors of the Morning" on TV Vijesta that there is no reason to panic and worry about the increase in electricity prices, even though it is likely that electricity will become more expensive.
"If the question is whether electricity should be more expensive? My answer would be yes, and I'm sure it will happen sooner or later, but I don't see it as a bad thing. On the contrary, we have constant suggestions from the European Union that electricity must not be a currency for bribery or a means to buy social peace. If you purchase electricity for 100 or 150 euros, and sell it to the consumer for 50 euros, is that realistic, is it justified, absolutely not," said Mujović.
He reminded that CEDIS gave up its regulatory allowed income last year in order to keep the bills lower.
“Is that right? I don't think so. If you constantly suppress the price of electricity and give up your allowed income, it means that you will not invest in your electricity system and this will lead you to buy social peace in the short term, but you will endanger future generations. So, do I have the right towards future generations to support non-investment in the electric power system, to support its exploitation to the limit without any investment", said the minister.
He also hinted at the possibility that the Government will use part of the EPCG profit that belongs to the budget to help the most vulnerable categories.
He could not estimate how much electricity would be more expensive.
"It is difficult to make ad-hoc calculations now, but I can tell you what the situation is in Serbia, where the increase in electricity prices has been in effect since November 1st. "Approximately eight to nine percent, and this happened as a result of the influence, that is, the agreement of the Government of Serbia with the IMF, which insisted that the Government of Serbia let Elektroprivreda and other state-owned enterprises that are under majority state ownership behave in the market," said Mujević.
EPCG: The prices were ten times higher than our customers
When asked by "Vijesti" about the possible increase of their item on the account, EPCG said that they have not yet made a decision.
"Elektroprivreda is still analyzing business costs and the state of the stock markets, because the issue of the price of electricity is a sensitive issue for every country, even those that are much more developed than ours. What should be emphasized is that electricity is a commodity, although it is specific because it is consumed at the time of production, that it is traded on the stock market and that its price depends on supply and demand, as for any other commodity", stated EPCG.
As they said, they are one of the few energy companies that did not raise electricity prices during the energy crisis in the past two years.
"At that time, the prices were ten times higher than the price at which EPCG sells electricity to its consumers. The prices on the market have now stabilized, but that price is currently still higher than the one at which EPCG sells it to customers, namely we sell it to customers at 45 euros per megawatt hour, and the price on the market is currently around 120 euros per megawatt hour. In addition, we are witnessing that the geopolitical situation further complicates the supply of energy products and affects the prices of energy products, including the prices of electricity," said the company.
They stated that only the first two items on the bill, active energy lower (NT) and higher tariff (VT), apply to them.
"EPCG can make decisions about those two items, and they make up about 45 percent of the bill. The other 55 percent of the bill refers to the unit prices of network services that are determined in the regulatory procedure, and at the request of the network operators CEDIS and CGES, the state, that is, the competent ministry for energy affairs determines the fee for renewable energy sources, and there is also value added tax, which is currently 21 percent," EPCG said.
They also stated that the entire situation regarding electricity prices, as well as energy supply, is complicated by the geopolitical situation.
"The war in Ukraine led to instability in the supply of gas to Europe, so all other resources were at their maximum, while the war in Gaza raised the prices of 'electricity for the day' by 20 percent," announced EPCG.
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