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According to the press release, the price of electricity depends on several factors: about half of the price is regulated by the state, the other half is determined by competition between electricity providers and the price on the stock exchange.
The maintenance of electrical networks important to the state and the share of other services in the price of electricity is approximately 55%. all electricity prices. The part of the price regulated by the state consists of the prices of transport services and services of public interest (PSO). The transmission service price includes the price components of the transmission and system services provided by Litgrid and the distribution services provided by Energijos Skirstymo Operatorius (ESO). These prices are regulated by the State Energy Regulatory Council (VERT).
Electricity price structure
© ESO
The share of the price of electricity itself and the price of its supply service is approximately 45 percent. It is this part that is not regulated by the state and is variable. Its price is determined by the price of the electricity exchange and competition between suppliers, which creates an opportunity for residents to choose. Therefore, the price of electricity differs in the offers of the different suppliers, since it is determined by the suppliers themselves and the purchase price on the stock market.
It is important to emphasize that consumers always win under such conditions. This is the purpose of abandoning the monopoly of electricity supply: when electricity is traded by more suppliers, the price becomes more competitive, customers receive more favorable conditions and more diverse offers.
It is noted that electricity prices change constantly, without price deregulation. However, until this change, domestic customers were more insulated from real price fluctuations in the markets, as the price was reviewed and regulated much less frequently. For this reason, market signals to clients were often long delayed, while at the same time smoothing over a longer period, eliminating short-term fluctuations.
The price of electricity is formed on the Lithuanian Power Exchange, which is integrated into the Nordic Power Exchange Nord Pool. Fluctuations in exchange prices are constantly driven by various changes in the supply and demand for electricity in Europe. They are affected by a wide range of factors such as air temperature, wind speed, rainfall, international connection capacity, operating modes and repairs of large power plants, gas and coal prices, and prices. emission permits, etc.
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