Power companies to apply for price increase again

TIRANA, August 9 – Albania’s power companies are expected to file applications on higher electricity prices again next September after last year’s rejection by the Energy Regulatory Entity (ERE), which is the decision making body.
Sources quoted by local media this week say state-owned power utility KESH will apply for higher sale prices in order to be able to pay off its debts.
Similar requests are expected to be filed by the other state owned transmission system operator (OST) and Czech Republic owned distribution system operator CEZ Shperndarje.
As a procedure, requests are filed in September while the final decision by ERE is made early in December.
Last year, Albania’s Energy Regulatory Agency (ERE) decided to keep electricity prices for 2011 unchanged, turning down requests by the three local operators which would increase power prices by an average of 12 percent.
ERE’s board of Commissioners decided to continue applying the two-tier price level, under which Albanian households will pay 7.7 lek/kWh for a consumption of up to 300 kWh a month and 13.5 lek for each kWh they consume above the 300 kWh threshold.
However, the ERE decision obliged state owned electricity producer KESH to sell energy to private distribution operator CEZ at 1.48 lek kWh starting from next January, down from 2.03 lek currently, considerably increasing the Czech company’s revenues which had desperately demanded price increase to handle rising costs and new grid investments.
Back in 2009, CEZ had requested a 24 percent price increase in electricity for 2010 but the Energy Regulatory Entity approved only a 13 percent increase which entered into force on January, 1 2010. In March 2009, CEZ signed a contract with the Albanian government after buying 76 percent of OSSH’s state-owned shares for 102 million euros.