Slovenia Will Cap Electricity Prices For Households, Small Business in September

By , 14 Jul 2022, 15:56 PM Business
Slovenia Will Cap Electricity Prices For Households, Small Business in September WolfBlur CC-by-0

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STA, 14 July 2022 - Electricity prices for households and small and medium-sized companies will be capped from 1 September to August 2023 under plans announced by the government on Thursday. Households will pay between 15% and 60% less for electricity than now, depending on provider, Infrastructure Minister Bojan Kumer told the press after the cabinet session.

Prices will be kept low through a combination of lower duties and measures that will reduce the profits of power generation companies, according to Kumer.

The excise fee on electricity will remain at 50% of the headline level, whereas the contribution for renewable sources will be cut in half come September.

Electricity prices for households and small business, including those in multi-apartment buildings, will be limited to EUR 0.118 per kWh at the higher tariff, EUR 0.082 kWh at the lower tariff and EUR 0.098 per kWh at the uniform tariff.

"These customers have so far been among the most affected groups of customers," the minister said, adding that the final cost of electricity on bills would be reduced for all household and small business customers, regardless of the supplier.

"It is a measure that directly addresses the increase in energy prices," the minister noted, estimating that savings for the average household customer would be between 15% and 30%, depending on how expensive their supplier is.

For customers of the suppliers with the highest price, the government measure means almost 60%, Kumer said.

In absolute terms, the regulation of electricity prices means EUR 110 to EUR 334 in savings in the annual cost of electricity for the average household customer or up to EUR 1,000 per year.

Kumer did not disclose exactly how prices will be kept low beyond saying that Slovenia was fortunate that electricity generation and distribution were in majority state ownership.

The government has been engaged in talks with stakeholders across the entire chain and they will "optimise costs" while eschewing some of the profits, he said.

Slovenian power generation companies have been able to sell electricity at market price driven by huge demand in the EU, whereas their underlying costs have changed little.

Kumer noted that this was the first package of measures dealing with electricity prices, which would surely be followed by another package. In the coming weeks, the government also plans to address the issue of high gas prices.

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