The leading electricity supplier in the Czech Republic, CEZ, has garnered a 14.3% increase in wholesale power prices, compared to the year ago price, following the second of a series of power auctions taking place in the country.
CEZ, the largest utility in central and eastern Europe, had earlier forecast a 15% increase in power prices against last year. CEZ has been forced by the Czech energy regulator to make power available in a series of ‘virtual auctions’ in an effort to introduce greater liberalization into the Czech energy market by facilitating new entrant access. The first ‘virtual’ auction for 2006 capacity was held on August 3, 2005.
Commenting on the results of the latest auction, CEZ’s deputy chairman Alan Svoboda said: The increase in traders’ demand for our electricity is higher than the increase in the domestic demand…it follows that a part of the traders calculate upon exporting electricity abroad for attractive prices. However, domestic customers do not have to be in fear that there would remain only expensive electricity on the market.
The regulator will announce the end-user price levels for next year in the Fall. CEZ says the Czech government is anticipating end-user increases of no more than 10%, a figure that the supplier claims would reflect the increases seen in the capacity auctions as well as wider trends in other European electricity markets.