Electricity

Thousands of businesses in FBiH to lose right to buy electricity at regulated prices

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Photo: EPBiH

Published

November 14, 2023

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Published:

November 14, 2023

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Under a new law, several thousand businesses in the Federation of Bosnia and Herzegovina (FBiH) will lose the right to public power supply at regulated prices and will have to buy electricity on the market at much higher costs, according to the Association of Employers of the FBiH and state power utility Elektroprivreda BiH (EPBiH).

Public or guaranteed electricity supply means that prices are regulated by the government, while prices on the market are formed freely. At least this was the case until the onset of the energy crisis two years ago, when the FBiH Government decided to limit price increases on the market to a maximum of 20%. Since then, the price of electricity has risen twice, both times by 20%.

The association warns that under the new Law on Electricity, which was passed in July, a large number of firms will have to switch from public to market supply.

“We are talking about several thousand businesses, mostly small family firms and sole proprietorships, which […] will see a significant increase in the price of electricity,” said Adnan Smailbegović, the association’s chairman.

Smailbegović: We are still waiting for the promised meeting with the government and EPBiH regarding the price of electricity

On this basis alone, EPBiH will earn an additional BAM 25–28 million (EUR 13-14 million) in 2024, so the association once again appeals that there is not a single justified reason for an additional electricity price increase for businesses in FBiH next year.

In early November, the association called on its members and all businesses in FBiH not to sign the contracts with increased prices that they had received from EPBiH. At that time, the association said that it opposed the hike and that it was in talks with the EPBiH management and relevant government ministers in order to resolve the issue of the price of electricity for businesses.

“We are still waiting for the promised joint meeting with representatives of the FBiH Government and Elektroprivreda BiH regarding the price of electricity for businesses. Our position is that the economy, and therefore citizens, must not bear the consequences of bad management and the problems at the EPBiH, which were caused by other factors that have nothing to do with the real economy,” said Smailbegović.

In mid-October, it was announced that EPBiH had a negative financial result of BAM 50 million (about EUR 25 million) in January to September.

EPBiH: Whoever doesn’t meet the criteria must buy electricity on the market

The EPBiH responded promptly, confirming that the new law significantly changes the rules regarding the right to buy electricity at regulated prices.

Qualified to buy electricity at regulated prices are legal entities and sole proprietors with less than 50 employees and a total annual revenue of less than BAM 8 million, whose facilities are connected at a voltage lower than 1 kV and whose consumption in the previous year did not exceed 50,000 kWh.

EPBiH clarified that this means that customers who do not meet these criteria will not be able to use the public supply service, so they will have to choose one of the licensed suppliers on the market.

In addition to small buyers, the right to public supply is also guaranteed to households that purchase electricity for self-consumption, as well as “end customers of special social importance” connected to the distribution gird at a voltage lower than 1 kV.

The latter category includes educational, humanitarian, welfare and religious institutions, organizations and associations, and those who provide employment or accommodation to vulnerable groups or perform other activities of special social importance.

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