How much did electricity price really go up in last 14 months?

While the authorities claim that despite frequent increases in the price of electricity for individual consumption in Serbia, its price is still among the lowest in Europe, consumers in our country are faced with the fact that since September of last year, including the price hike that will take place on November 1st, electricity price went up three times by as much as 24 percent.

And that’s not all because, according to the agreement between the Government of Serbia and the International Monetary Fund, in May of next year there will be yet another increase in the price of electricity by 8 percent.

To remind, on November 1st, the price of a kilowatt hour for individual consumers in Serbia will cost 10.26 dinars plus VAT.

After the price of electricity for individual consumption in Serbia was corrected in September of last year, for an average consumption of 450 kilowatts, consumers had to pay an electricity bill of about 3,700 dinars.

Fourteen months later, the amount on that bill is about 4,600 dinars while consumers who used electricity for heating during the winter season will have to pay at least 5,800 dinars per month.

For a country where the median salary is only 66,000 dinars and the average pension is lower than the value of the minimum consumer basket, an additional 900 dinars per month, compared to the period before September 2022, is a severe blow to the household budget.

This year alone, electricity consumers have already had two price increases. The first was on January 1, when the price of electricity for individual consumers went up by 8 percent and the second was on May 1, when it went up by another 8%.

As a reminder, in its report published at the beginning of summer, the International Monetary Fund pointed out that as of November 1, citizens of Serbia are expecting a new increase in the price of electricity by eight percent and gas by 10 percent, and that new price increases with the same percentages will follow in May 2024.

The IMF explained the price increase by the fact that “a further increase in electricity and gas prices is necessary in November this year and in 2024 in order to eliminate all budget subsidies to state energy companies until the arrangement with the IMF expires and to finance the much-needed investments in the coming years.”

By the way, the price of electricity will definitely go up on November 1 despite the fact that the Serbian authorities have repeatedly said the opposite.

Previously, Serbian President Aleksandar Vučić said that if the situation with energy sources remains favourable, “there will be no need to increase the electricity price”, followed by the Minister of Mining and Energy, Dubravka Đedović, who stated that she hopes that the electricity and gas prices would not change by the year-end.

Minister Đedović later refuted what she had said earlier by claiming that “Serbia must implement energy reforms and that they include higher electricity and gas prices.”

The new increase in the electricity price in Serbia has met with vigorous opposition from consumer associations, which think there is no justified reason based on economic logic to raise the price of electricity while the Serbian citizens are suffering under the economic crisis and have a low living standard.

As of November 1st, the gas price will also go up, excise duty on certain products has already gone up while the price of diesel is at an all-time high.

(Danas, 12.10.2023)

This post is also available in: Italiano

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