Posted by on 17 Jun 2011. Filed under Current Affairs, Top news. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

Gas Bills to Increase by an Average of 7 Percent

Yesterday utilities regulator increased gas prices by an average of 7% for households. Here The Daily provides a translation and summary of an article from today’s Pravda on the subject.

By Michal Holeš

 

From July gas will be at its most expensive level ever as the price from SPP is increasing by an average of almost seven percent. After the New Year increase in prices by almost 4.5 percent, this is the second price hike in the space of one year. Family budgets will only be burdened following the annual balance billing, though, because the gas company will not automatically change the amount of advance payments.

 

photo (c) James Riden

More expensive gas means also more expensive heating in blocks of flats by around six percent. The decision to increase prices was published yesterday by the regulator URSO, headed by Jozef Holjenčík (Smer-SD nominee). “The price of oil products and the exchange rate of the euro against the dollar has changed and the regulatory authority had to react to it,” said Holjenčík about the decision. It means that a family in a standard house without insulation, using around 3,000 m3 of gas a year for cooking, hot water and heating, will pay around EUR 8.9 a month more under the new prices.

For the gas company this hike is still not enough and just like last year its spokesman Ondrej Šebesta is claiming that the company is generating a loss in the sale of gas to households. “the new prices of gas cover just part of the costs of SPP that are linked to the supply of gas for regulated segments” said Šebesta.

The majority of competitors to the dominant supplier continue to offer discounts of 7-12 percent over SPP’s prices. With a change of supplier, households would not have to pay more for their gas. Twelve and ten percent lower prices are being offered by other competitors RWE Gas and ČEZ Slovensko, but they are requesting a two-year minimum contract from customers. Both companies are promising to preserve minimum discounts also if prices of gas for customers are increased.

Other alternative gas suppliers do not want to talk about any price increases at present either, like Magna EA, Energetické centrum, Vaša energia and Lama Investments. Slovaks experienced their last major price increase back in 2005, when the price of a cubic metre increased by more than twenty percent. After that the fees for gas consumption remained almost unchanged and even dropped at the beginning of 2010.

After the new government took up power, representatives of half state-owned SPP, which thanks to the privatisation agreement is run by the foreign owners, submitted eight requests to increase the price of gas in the range of seven to thirty percent. Holjenčík swept them all off the table, though. He justified it by the fact that the requests did not carry the consent of the General Meeting or they did “not reflect reality”.

Eventually the regulator at its own initiative increased prices by 4.5% from the New Year. At the beginning of May this year, it  received yet another request from the gas utility to increase prices, which Holjenčík says were supposed to increase by over 40 percent. If the regulator had identified with these proposals of SPP, households would be paying EUR 8 – 340 a year more depending on the category of their consumption.

Even the price of gas intended for heating companies will increase by almost 9.4 percent. According to head of the heat producers association Miroslav Obšivany, this causes an increase in the price of heat to a similar level as those in houses. “Fees for heat in blocks of flats linked to heating companies using natural gas will see an increase of about six percent,” specified Obšivaný.

Published as unofficial translation of article from Pravda in line with Fair Use Extract Copyright

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