Czech energy group CEZ will raise electricity and gas prices as of January, with the former to grow by about a third and the latter to soar by a half to two thirds, CEZ CEO Daniel Benes told business daily Hospodarske noviny (HN).
The price hike applies to customers whose prices of energy with delivery next year have not been fixed.
CEZ will publish the change on November 1 with effect from January 1. It also involves the regulated item of the price that is yet to be announced by the Energy Regulatory Office (ERU), Benes announced.
He estimated a growth in electricity prices at about 30 percent. Wholesale prices hit record highs across Europe because of rising prices of gas, carbon credits and economies recovering from the coronavirus pandemic, which raised demand for energy, Benes told HN.
As to gas, the price increase will be really “dramatic,” according to him. CEZ is not the main distributor but final prices may grow by a half up to two thirds, said Benes.
In the past week, energy suppliers like Bohemia Energy with about 900,000 customers, Kolibrik energie with 28,000 clients and A-PLUS Energie obchodni with 150 clients said they were winding up their business.
Major energy market players like CEZ, PRE, E.ON and innogy have registered a huge demand for their services in recent days.
More than ten electricity and gas suppliers can be expected to wind up business by the end of the year, mostly small firms whose clients will be absorbed by the remainder of the market, said Jiri Gavor, an ENA analyst and executive head of the association of independent energy suppliers ANDE.
There are currently about 100 energy suppliers on the Czech market, most of them having fewer than 10,000 supply points, he noted.
The collapse of Bohemia Energy, whose size was comparable with some traditional suppliers, was an exceptional case, he added.
According to BH Securities economist Stepan Krecek, as much as 20 percent of suppliers may end business. “They will pay for their amateurish risk management in energy contracting,” he said.
Out of the total of 6.2 million electricity supply points in the country, some 1.4 million belong to alternative suppliers, energy consulting firm EGU Brno strategy head Michal Macenauer said.
“Large suppliers will undoubtedly cope with the situation, but the smaller ones can have problems,” he added.
“Price hikes are a logical and expected step,” Natland economist Petr Barton said, commenting on CEZ’s announcement.
CEZ’s price rise is, however, bigger than expected, Krecek noted.
Source: CTK
