Gas Company SPP Has 15 Lawsuits Against Regulator
The principal Slovak gas company SPP, a.s., which is half-owned by the state (51%) and half by foreign investors (49%), has filed a total of 15 lawsuits against the decisions of the Slovak Republic’s utility regulator URSO for not allowing it to increase prices sufficiently to cover its costs in the household segment.
The Regional Court in Bratislava confirmed the news for daily Pravda today, while both SPP spokesman Ondrej Sebesta and the regulator refused to comment on the matter. The lawsuits are over the refusal of the regulator to increase prices by the requested amount for the period from November 2010 and May 2011.
National regulator URSO rejected several price proposals and appeals before eventually agreeing on an increase in prices of 4.5% in July, but this is far from what the company was hoping for.
Head of the regulator Jozef Holjencik said the price proposals did not reflect reality, but if the company is successful in its claims, the difference could be covered by customers through their gas bills in the end.
Economy minister Juraj Miskov said that they were monitoring the process carefully via the state’s representatives in the company, where the foreign minority shareholders hold control over the management. SPP is claiming that it lost around EUR 70 million in the household segment last year, with similar losses in the segment expected this year, too.
The last time the courts decided on gas prices it was because SPP had increased them by 20% in 2005, which the Regional Court in Bratislava deemed excessive, and so the company was sued by the company Slov-Energia, which is representing tens of thousands of households who agreed on its representation, at a 40% commission.
Collectively some EUR 66.6 million is being sued in compensation, but the court case is still ongoing three years after the verdict was issued in 2008. The current lawsuits will also probably drag on for years and years.