The Energy Regulatory Agency has determined that the Montenegrin Electric Transmission System (CGES) should return 34,7 million euros to consumers due to the excess income it had in recent years based on the issuance of cross-border capacities (mainly cable for Italy), but in the next year everything will be returned around 9,5 million euros through the reduction of his item on the accounts, while the remaining part will be returned in the following years.
This was stated in the Report on the determination of the amount of corrections to the regulatory allowed income of CGES, on which the public discussion ended two days ago.
The regulator previously made a decision to which the Montenegrin Electric Distribution System (CEDIS) will additionally increase the regulatory allowed income by about 13,5 million euros from next year, which is more than the decrease for CGES. So there should be a small increase in the total price of electricity from January, even if Elektroprivreda (EPCG) does not increase its item on the bill. EPCG has not significantly changed its item for 15 years.
The agency needs until the end of November to make a decision on the regulatory permitted income of energy companies, which part of the increase and decrease goes to which group of consumers and their ultimate impact on the final price of electricity.
EPCG has the right to increase its part of the item on the account - active energy whenever there is a disruption in the market and an increase in its costs, and it does not need the Agency's consent for that. This company previously told "Vijesti" that they are still analyzing whether they will increase the item on their part of the electricity bill. Next year, Thermal Power Plant Pljevlja will not work for eight months due to the completion of reconstruction. During that period, Montenegro will be a significant importer of electricity, and its prices on the stock market are up to three times higher than the amount that EPCG receives from consumers' electricity bills.
The agency states in this report that the CGES item, on the accounts of consumers up to 0,4 KV with a two-tariff meter, which refers to the engagement of transmission capacities should be reduced by 5,59 percent and for justified losses on the transmission network by 1,7 percent. Both reductions would reduce the final price by less than two percent.
He sent comments on this plan of returning the subscribed amount of CGES money during the public discussion to the Agency Momir Shkopelja, former member of its management.
He says that the Agency formulated the text in such a way that it is not known who determined the regulatory allowed income (RDP) in the previous period and made a mistake of 34,8 million euros, and not the same Agency (REGAGEN).
"The claim on page 17 that "the determined corrections are predominantly the result of the deviation of realized revenues based on the allocation of cross-border capacities compared to those determined that depend on the price of cross-border capacities formed on market principles" is half-true and non-objective. This is because, based on this formulation, one gets the impression that it is a case of a higher power, and the real cause for such a catastrophically large deviation is the bad assessment of the Agency", said Škopelja.
He also says that at the time of the earlier decision on the regulatory allowed income for CGES, there were clear indications that the income generated based on the allocation of cross-border capacities will be significantly higher than those estimated by the Agency.
Škopelja specifies that at the time of the decision on prices for 2023 (November 2022), the revenues from the allocation of transmission capacities of CGES amounted to about 32-35 million, and that at that moment the Agency estimates those revenues for the whole of 2023 at 23,9 million.
"From the above, it is clear that the explanation that 'the determined corrections are predominantly the result of deviations in realized revenues based on the allocation of cross-border capacities, etc.' they represent only an attempt to remove responsibility from the Agency", says Škopelja.
Škopelja: It's unfair that customers have to wait years for a refund
In the report, the agency states that a one-time return of the entire excess income to consumers would have negative consequences for the operations of CGES in 2025.
Škopelja believes that such a decision is not appropriate, because CGES achieved a net profit of 35,7 million last year, of which it distributed a dividend of 10 million, and that the total undistributed profit of CGES is 80 million.
He states that companies could pay the entire refund in one year and that this would only affect the reduction of undistributed profit to 45 million and that this would not be an "unfavorable impact on the business of the energy entity" from Article 11 paragraph 2 of the Rule on Corrections that would justify redistribution of returns over several years.
He believes that 25,3 million euros can be returned to consumers in the next year, as well as that it would be bad for consumers to wait several years for a refund.
"This is all the sooner because we are in a period of high inflation (especially during 2023), so any delay in returning the full amount of compensation is to the detriment of customers. In addition, there is a high probability that the amount of compensation for 2024 and 2025 will reach a significant amount, so the redistribution of compensation based on the corrections for 2023 would lead to an unnecessary accumulation of redistributed amounts in the following years. That is why I believe that the limitation in the amount of compensation for 2025 based on the correction from 2023 is justified only to the level that there is no negative RDP CGES for 2025, which is transposed into prices and which, according to the Decision, amounts to 25.385.258,37 €. In other words, I believe that of the total corrections for 2023 of €34.787.557, €2025 should be compensated in 25.385.258, and only the difference of €9.402.299 should be transferred to the following years," said Škopelja.
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