Croatia: HEP has Already Lost 25,000 Customers

Published on 13. September 2013., SEE Energy News

Croatian energy company and electricity provide HEP lost to its competition nearly 25,000 consumers in few months – to the Slovenian GEN-I and the German RWE Energy, in most cases are households, but also about a thousand business customers and big consumers. GEN-I signed contracts with a total of 6,848 new users, it was reported recently from this company, while RWE Energy, as noted in the company, got 16,500 households and thousands of business users.

As the first man from the GEN-I Robert Golob said last week, the Slovenian company is ready to turn additional price cuts after HEP additional price decrease.

– If HEP is going to decrease their prices, we will also offer at least ten percent lower price than that – announces Golob.

GEN-I earlier this month began supplying hundreds of large and small business customers and public organizations, including a number of trade centers, but also tourist companies, three shipyards, while, it should be recalled, the state handed over to the Slovenian company also the supply of all ministries and government offices with electricity.

On average, RWE Energy and GEN-I offer cheaper electricity to ten percent than HEP, which has its own price decrease announced long ago, with the arrival of competition in June, and submitted to the Croatian Energy Regulatory Agency (HERA) a request for price cuts of around six per cent in early July.

What subsequently took place between HERA and HEP, looked like it actually still resembles, as badly rehearsed play, which is a consequence of the fact that 2.3 million HEP users still pay more for electricity than they should and that the state HEP is losing more customers.

Even at the end of last year in HEP​​, as we found out, they agreed, and in these agreements took part a member of HEP Management Board at that time, and now its president Tomislav Seric, to register a new company owned by HEP in which they will switch the supply of electricity to the HEP-ODS (HEP distribution System), which sooner or later, according to EU rules, must be done.

This would be a company , if it was was established, which could immediately upon arrival of competition in the market perform as well as the competition, or without the approval of HERA freely form their own pricing.

At the head of HEP changes have occurred, Seric replaced Zlatko Koraćević, a new business for the supply has not been established, and in March came into force a new law on the electricity market, which says that HERA must adopt a new methodology for determining the amount of tariff items, as precondition for any HEP request for change of prices.

HERA has not developed a methodology from March to July, which HEP knew very well in July, when they were giving requirement for price cuts. Anyway, the request was submitted theatrically, while sending it to the wrong address – in HEP Ltd. instead of HEP ODS as a supplier.

HERA, instead of immediately setting as the independent regulator, which is its task, and saying that request of HEP is improper, accuses itself after that in the public, noting that it did not yet adapt to the implementing regulations.

The new methodology should be released these days, after which the HEP ODS will resubmit its request for price cuts, a full three months after the arrival of competition. At the same time, in HEP is again reorganization being prepared,  where the supply of customers will come out from HEP ODS to the new company.

Source; Serbia Energy See desk/HEP/RWE Energija/GENI