Increased Electricity Prices to Make Everything More Expensive

Total Croatia News

Average household electricity bills will be higher by about 250 kunas a year.

The government on Thursday passed a decision to increase the renewable energy sources fee from the current 0.035 kunas per kilowatt (kWh) to 0.105 kunas per kWh, starting from September, which will increase the average household electricity bill by about 20 kunas a month, reports N1 on August 31, 2017.

“The decision will increase the amount on electricity bills by an average of 23.10 kunas. The average household consumes 292 kWh. Despite this correction, the price of electricity will be lower by 5.13 kunas compared to the same period last year,” said Environmental Protection and Energy Minister Tomislav Ćorić.

“In the last four years, there has been no correction of the renewable energy sources fee, but there has been an increase in the production of electricity from renewable sources. Financial sustainability is not possible without this increase. We believe that we have closed the financial structure for 2017 and 2018, and there should be no additional adjustments of this fee during that period,” Ćorić said.

Asked if this price increase will affect the final price of other products since the electricity will be more expensive for businesses as well, Ćorić answered, “Any price increase in energy costs will lead to higher costs of production. That will happen at both the household and industry level. However, it is not possible to introduce different fees for households and businesses. Fortunately, in Croatia, there are not many production capacities that have electricity as a significant production resource, and therefore this in itself should not create inflationary pressures. We believe that this price increase should not lead to major changes in prices of goods and services.”

Ćorić also responded to the criticisms from MOST, expressing the regret that his ministerial predecessors Dobrović and Panenić “have not used their influence to make this system sustainable.”

The Croatian Employers’ Association (HUP) president Davor Majetić is disappointed with the government’s decision. He said businesses were concerned about the decision, especially since they have just 24 hours to prepare for it.

“We have talked to the government about it, but we did not have the information when the decision would be made, and especially how much the increase would be. We have talked about making the increase smaller for the industry, and we have offered different models to make this pressure on prices not felt as strongly. Unfortunately, the electricity price will be about 15 percent higher for all employers. What is concerning is the ease with which this decision was made, and nobody consulted employers about it. The 15 percent increase in energy prices means loss of competitiveness and brings an increase in prices of services and products for all end users in Croatia,” Majetić said.

He added that all end users of services and products would feel the effects. “Our business costs will increase, and the cost will be shifted to the prices for end users – for citizens, employers and the state. And exporters will be less competitive as well,” Majetić said.

Translated from N1.


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