Serbia: Small companies await new electricity market prices?

12. December 2014. / News Serbia Energy

All electricity consumers will be able to choose their suppliers on the market from January 1st, but it is not expected that a large number of households will take advantage of this possibility.

Ljiljana Hadzibabic,a member of the Council of the SerbianEnergy Agency, said that the major part of the market would remain on the public supply at regulated electricity prices even after the complete opening.

“The share of households in the final electricity consumption in Serbia is 51 percent. This is a very high proportion and the consequence because the industry is not active”, she said.

Hadzibabic pointed out that the Agency’s estimate was that there would be a large migration to the free market of those customers who had regulated electricityprice because it was below the real market value.

“The state made a strategy and wrote that it would reach the regulated priceon a regulated marketwithin two or three years, but it’s not sustainable. To make it happen the Electric Power Industry of Serbia (EPS) would seek the increase twice a year”, she said.

Hadzibabic stated that currently 34 percent of the electricity market was opened in Serbia, which meant that buyers purchased such a share of total spending on the market.

With the adoption of the new Law on energy, she added, also the customers who consume more than 30,000 kilowatt hours of electricity per yearwill have to enter the market.

Hadzibabic added that currently there was not great interest of new electricity suppliers to offer services to households, because it was not profitableunder current market conditions.

Representative of EPS supply Radovan Stanic said that according to the company estimates, about 30,000 small customers, mostly the companies,would have to enter the market from January 1ston the basis of the rules.

Stanic said that their consumption was about 2,640 megawatt hours per year, which was about eight percent of total electricity consumption in Serbia. According to him, the households that consume more than 1,600 kilowatts hours per month, or enter the “red zone” on the consumption, could be interesting for the suppliers.

“The interest to enter the free market could have around 400 households with single tariff meters that consume more than 2,000 kilowatt hours per month, and about 2,000 households with two-tariff meters”, said Stanic.

The opening of the electricity market in Serbia began in 2013th. The large consumers connected to the high and medium voltage have been obligated so far to find supplier on this basis. Households will be able to enter the marketfrom the next year, but they will not have to because the state is obliged to provide them supply at regulated prices.

The average price of one kilowatt-hour for the household, without calculated value added tax (VAT),is 50, 81 EUR and 48, 38 EUR for the industry in Serbia.

Minister of Mining and Energy of Serbia Aleksandar Antic said that the new Energy Law would be adopted by the end of this year. He pointed out that the Law would absolutely apply the rules of the Third Energy Package and received a positive assessment by the European Commission and the Energy Community.

Antic pointed out that energy had no bounds, especially in times of crisis and that therefore it was necessary to strengthen regional cooperation and make joint energy policy defined.

Head of Department of Power Energy Community Simon Uzunov said that Serbia was leader by reforms in the energy sector in the region and that it played an important role because of the central position in the region.

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