The Government of the Federation of Bosnia and Herzegovina has declared a state of power supply emergency for 2024. As a result, the rise in price for businesses will be capped at 20%.
The state of power supply emergency for 2024 was introduced because of the enormous rise in market prices and the insufficient supply of electricity, the entity government said. According to the FBiH cabinet, the decision will enable it to adopt measures that will prevent the price of electricity from increasing by more than 60%.
The state of power supply emergency was declared at the proposal of the Federal Ministry of Energy, Mining and Industry.
The government said state-owned power utility Elektroprivreda Bosne i Hercegovine (EPBiH) conducted an analysis showing its average selling price would in the current market conditions amount to 141.53 EUR per MWh in 2024, which would be a 87% jump.
Electricity would become more expensive for 96% of consumers
More than 96% of the electricity buyers that benefited from price caps so far would face a hike of more than 60% without the new measure, the government said. The Federation of BiH is one of the two entities making up Bosnia and Herzegovina. The other one is called the Republic of Srpska.
According to Prime Minister of FBiH Nermin Nikšić, EPBiH sells electricity for less than it costs to generate it. Therefore it will increase prices, but no more the 20%, he stressed.
Nikšić said prices for households would be reviewed and that customers who consume a lot would have to pay more.
Nikšić: EPBiH sells electricity for less than it costs to generate it
Of note, the entity government capped the rise in prices for businesses to 20% for the last two years and the tariff did grow by 20% both times.
Two weeks ago, the Association of Employers of FBiH called on its members and all companies not to sign contracts with increased prices that EPBiH sent them. The levels were about 70% higher than one year earlier.
Of note, most companies in the entity are supplied by the EPBiH, which is in financial problems. The utility has posted a BAM 50 million (EUR 25.6 million) loss for the first three quarters.