Electricity Prices to Probably Increase Next Year

Total Croatia News

Despite promises by Economy Minister Panenić, prices are likely to go up.

Starting from 1 January next year, the fee for renewable energy sources, which is part of each electricity bill, will increase from current 3.5 lipa to 12 lipa per kilowatt-hour (kWh), reports Večernji List on September 25, 2016.

This in turn means that electricity bills for households with average consumption of about 3,000 kWh per year will increase by about 30 kuna a month. However, Economy Minister Tomislav Panenić said in recent days that consumers could be sure there would be no increase in their bills because the Ministry would come up with a model that will annul the increase.

He stated that this could be achieved by reducing the value-added tax on electricity or with negotiations with electricity suppliers and regulators, which would bring down the price of electricity itself. At the same time, Panenić accused the previous government and then Minister of Economy Ivan Vrdoljak that the relevant decisions were made during their term in office.

Vrdoljak replied that during his term, the fee was already increased from 0.5 to 3.5 lipa, but the increase was at the time compensated with lowering the price of electricity by 10 percent. He added that this year the fee should had been increased to seven lipa, but that did not happed due to, as he said, idleness of Minister Panenić who now has to increase the fee to as much as 12 lipa. Vrdoljak pointed out that the increase of fees for renewable energy sources was inevitable, but that the government should do it gradually.

Some experts say that Panenić could try to annul the increase in fees for the renewable energy sources on the electricity bills by forcing the Croatian Electric Company (HEP) to lower its prices, but there is not much space for that, perhaps only three to four percent. The reduction of the value-added tax on electricity to 12 percent would be a bad idea since it would cost the state budget about a billion kuna a year, and would at the same time encourage imports, since Croatia imports between 30 to 40 percent of its electricity. Panenić was unavailable to comment on the issue.


Subscribe to our newsletter

the fields marked with * are required
Email: *
First name:
Last name:
Gender: Male Female
Please don't insert text in the box below!

Leave a Comment