Rebound in Electricity Prices: Some Commercial Consumers Overpay for Electricity

“The liberalization of the electricity market for non-domestic customers began in 2013, but more than 14 thousand companies have not yet chosen an independent supplier, so the guaranteed supply of electricity for them is provided by AB Energijos Skirstymo Operatorius (ESO). The total electricity consumption of these companies is 300 million. kilowatt-hours per year, and if they do not choose suppliers and are not interested in the conditions of available electricity supply, these companies lose millions of euros, ”says Artūras Zatulinas, Head of Corporate Clients at Elektrum Lietuva.

According to him, these conclusions were reached after examining the differences between the guaranteed supply and the prices charged by independent electricity providers. The price of the guaranteed electricity supply in January this year was 57.19 Eur / MWh, in February – 67.05 Eur / MWh, if the trends of February are maintained, in March. the guaranteed supply price will even exceed 80 Eur / MWh, while the average prices even of the company’s small business customers have not exceeded 55 Eur / MWh in the last two months.

“If all companies that buy electricity under guaranteed supply conditions used the services of independent providers, they would save a total of around 300 thousand LTL in February alone. At higher prices, this amount can increase to several million per year over time. Of course, guaranteed electricity supply rates can also change in a downward direction, but our long-term calculations show that guaranteed supply customers pay up to 10% of electricity per year on average more than choosing electricity providers. independent, ”explains A. Zatulin.

The price of electricity paid to commercial customers using the guaranteed supply service changes every month and can therefore fluctuate significantly; it is recalculated based on the average price of NordPool’s energy exchange last month. In the case of an independent supplier, the price is established taking into account the electricity consumption of a particular company, the peculiarities of hourly consumption, the supply period chosen by the customer and remains stable, so that the consumer can significantly reduce costs compared to guaranteed electricity.

According to A. Zatulin, the country’s commercial companies became more interested in market opportunities and in the existing electricity supply conditions after the start of the liberalization of electricity for domestic consumers. Commercial electricity users, who are still covered by guaranteed supply, are often interested in opportunities for change.

The interviewee says that currently small companies, which consume up to 100 MWh of electricity per year, are the most chosen independent providers. Meanwhile, medium and large companies often choose an independent supplier due to the growing interest in green energy and the desire to use only electricity from renewable sources.

The state also encourages companies to actively monitor the conditions of their electricity supply: the State Energy Regulatory Council has asked ESO to publish information on commercial consumers on a common data collection and exchange platform. Some of this data is public, so its publication allows independent suppliers to access the list of electricity consumers without violating the legislation.