Serbia: Unjustified electricity price increase, mismatch with EU market trends

16. July 2015. / News Serbia Energy

A serious increase in the electricity price is not possible and justified in Serbia, particularly considering the difficult economic and social situation of the population in Europe and falling market prices of electricity.

Therefore reaching the market price of electricity in Serbia should be extended for a maximum as can be, at the same time working at two jobs, increasing energy efficiency and improving the efficiency of electric power companies.

Besides the announced price increase on August 1st by 12 percent, the electricity could be increased once again in the next year, by about 10 percent.

This is necessary and sufficient for the construction of new power plants, which for decades has not been built in Serbia.

The market price of electricity in the region and Europe is currently lower than expected due to slowing economic growth in Europe and the price decreased from 55 EUR per megawatt hour to about 40 EUR.

In addition, the equipment price for investment in new energy projects did not grow, and also therefore the growth of the market price of electricity could not be expected, neither in Europe nor here.

If the industrial growth in Europe would be strengthen, there could be a rise in the market price of electricity in Europe.

It was possible to have a lower jump of market price of electricity in July and August on the global market, if there was drought and poor hydrology, which could make hydropower plants less to operate, because thermal power plants in this period work less because the outage.

Also the renewable energy sources and tax of carbon dioxide emissions can have more global impact on the growth of electricity prices, which are the policies of which the European Union is not giving up.

Experts had previously estimated that in Serbia should increase the price of electricity by 30 percent in order to reach market levels.

However, since the electricity price falls in the free market, also the alignment of domestic prices with market power can be lower, which will depend on further price movement of this energy in the market.

The Serbian Government stated recently in the Letter of Intent sent to the IMF that Serbia, if necessary, planned to increase the electricity price in 2016th and 2017th, for further convergence of these prices to market levels.

Minister of Energy and Mining Aleksandar Antic explained then that the Government was doing all to stretch on the process of achieving a minimum market price of electricity in Serbia for many years, not less than five years, at the same time expressing hope that they will not have to come up with new increase in electricity prices, because there is intention to achieve internal cost savings and better financial results in EPS operation. , transmits Serbia-energy.eu

Download as PDF :

Download PDF