Serbia set to start deregulation of electricity, gas markets on Jan 1

In the first phase, 27 large industrial consumers will have to start buying their power on the deregulated segment as of next year, AERS council member Ljijana Hadzibabic said in a statement issued by the energy ministry after a conference held on Monday.

The plans will go ahead despite the fact that not all market players are ready and despite a request from around 18 industrial consumers that the move be put on hold for several months and warnings from public utility companies that they will not be able to cope with the higher deregulated tariffs.

Serbian state-owned power producer Elektroprivreda Srbije (EPS) has offered to these industrial consumers a price that is 46% higher than the regulated electricity tariff, although the actual price should be as much as 60% higher, EPS manager for electricity trading Dragan Vlaisavljevic said at the conference.

He added that deregulating a market like Serbia's - where power tariffs are among Europe's lowest at an average of about 0.055 euro ($0.073) per kilowatt-hour, is bound to be a difficult task.

($=0.7531 euro)