Serbia: Power utility EPS to request change of tariff system

25. February 2015. / News Serbia Energy

Electric Power Industry of Serbia will request changing of the electricity tariff system, it was announced from power utility company

The existing tariff system used for calculation of electricity consumption of households in Serbia is outdated and complicated, and electricity bills are still confusing the citizens, which is why EPS will require from the Energy Agency of the Republic of Serbia to change that system, said Executive Director of EPS Dragan Vlaisavljević on conference focusing on Energy security sustainability questions.

The tariff system can be much simpler, but that does not depend on EPS, Vlaisavljevic said, adding that EPS sells electricity much simpler to eligible customers in the free market.

Speaking of electricity market in Serbia, Vlaisavljević pointed out that one cannot expect for other companies to enter the Serbian market and to supply households with electricity, since the price offered by EPS is significantly lower than the market price.

He also pointed out that, globally speaking, there is a dramatic drop in profits of electric power companies, due to the fall of consumption and increase of electricity prices because of renewable energy sources, which slowly “push away” from the market the conventional energy sources – gas and coal, which is why wholesale electricity price is falling, and on the other hand retail price is growing due to various taxes, subsidies, and network tariffs.

Electricity consumption is also declining, which declined in 2014 in Serbia by one percent, and as well in the region in the coming years cannot be expected growth in electricity consumption, due to underdeveloped industry in these countries, Vlaisavljević added.

Deputy Minister of Energy Milos Banjac announced that in Serbia this year will start the drafting of the action plan for the implementation of the directive on “large combustion plants”, which applies to energy plants with a capacity bigger than 50 megawatts, while the application of the directive on “industrial emissions” was postponed until 2027.

The fulfillment of these environmental obligations will cost Serbia several hundred millions of euros, but this will be implemented gradually after 2027, said Banjac.

He pointed out that Serbia probably will not be able to fulfill the obligations on the blending of biofuels in petroleum products by 10 percent by 2020, which is why the postponement will be requested.

Banjac said that Serbia’s strategic goals in the field of energetics are the security of energy supply, revitalization and construction of new hydropower plants, increasing the share of renewable energy sources, as well as further harmonization of its energetics with European regulations.

He also announced that in the next twenty years the world’s energy consumption is expected to grow by app 40 percent, pointing out that energetics is the backbone of economic development of every country.

The President of the Council of the Energy Agency of Serbia Ljubo Maćić pointed out that the long-term sustainability of the electric power sector requires investments in new power plants, which are not likely expected in the region in the near future due to low electricity prices and falling consumption. He pointed out that the regulated electricity prices in Serbia are below the market level, which is why EPS doesn’t have big profits and is not in the position to invest in new plants. Maćić pointed out that it is necessary to build new pipelines in Serbia and the region, reminding that there are several different projects, whose completion is a good thing if it happens, because that way we will avoid the risk in gas supply. He also pointed out that investing in energy efficiency is needed in Serbia, which is even better than investments in new power plants because, as he said, “the cheapest energy is the one that is not consumed.”

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