Electricity Raised Quietly

silent increase in electricity
silent increase in electricity

With the decision published in the Official Gazette last Friday, the Energy Market Regulatory Authority (EMRA) determined the scope of the tariff, which is called the “Last Source Supply Tariff” and where the consumer electricity price changes instantly on a cost basis, to be effective from 1 January, with a monthly invoice of 300 thousand TL. down to paying users. Thus, the electricity prices of the consumers included in this scope have been increased by at least 10 percent compared to October data. Although this decision will not directly affect the low-consumption consumer, it will increase the input cost of manufacturers and workplaces, causing prices for end-consumer products to increase. The electricity suppliers comparison and switching site encazip.com evaluated the silent hike in electricity.

Increases in electricity costs gradually began to reflect on consumers. The electricity prices of the tariff, which is called the Last Source Supply Tariff, applied to high consumption consumers who have not changed their electricity supplier, are determined differently from the national tariffs applied to other consumers. These tariffs, which were determined by adding a 9,38 percent margin to the net electricity supply cost in the relevant period, covered consumers whose monthly bill was 700 thousand TL in the previous period. With the last decision of EMRA, this scope was reduced to 300 thousand TL monthly invoice amount. This decision, which will be effective from January 1, will cause more producers and businesses to use electricity at a much higher price.

Electricity costs increased 83 percent year-to-date

Increases in electricity costs remain hot on the agenda. According to the analysis of electricity tariffs comparison site encazip.com, the net electricity supply cost, which was 0,406 TL in the electricity market in January of this year, reached 25 TL on average in the first 0,742 days of October, increasing by 83 percent during the year. The main reasons for this increase were the increase in the price of coal and other resources and the rapid increase in the exchange rate.

Electricity costs will increase further

With another decision taken by EMRA this month, the ceiling price application in the electricity market was updated. In the market where electricity prices are determined, the ceiling price, which was 0,718 TL per kilowatt-hour for the previous period, was increased to 1,078 TL for this month with this decision. According to the decision, the ceiling prices will be determined based on the electricity costs of the 12 months before the relevant period. A serious increase in electricity costs in the last 12 months will cause the ceiling price to increase every month. On the other hand, the rapid increase in exchange rates is expected to have a serious negative impact on the costs in the electricity market, of which 70 percent is indexed to foreign currency.

Producer electricity has been quietly increased by 10 percent

The increase in electricity costs was reflected on consumers with a monthly electricity consumption of 700 thousand TL or more. According to encazip.com's analysis, the electricity bills of these consumers will be approximately 15 percent higher than the previous month, based on current costs in October. Since the Last Resource Supply Tariff, whose scope has expanded, will now include electricity users paying bills of 300 thousand TL or more per month, many more producers and workplaces will be affected by the increasing electricity costs in the market in the coming period. The new application will come into effect from January 1, and if the distribution fee and taxes remain constant compared to the market prices for the first 25 days of October, the electricity bills of these consumers will be at least 10 percent higher.

Increasing costs are again on the back of the manufacturer

With this application, the increases in electricity costs will be imposed on producers and workplaces, and the electricity prices to be applied to low-consumption consumers will be at a more controllable level. However, since this change will seriously increase producer input costs, the prices of consumer products will be adversely affected and the real impact will be felt by the consumer.

The main reason for the increase in electricity prices is the high exchange rate.

Evaluating the latest developments and price increases in the electricity market, Çağada KIRIM, the founder of encazip.com, said, “Electricity costs are breaking records all over the world. In our country's market, the global energy crisis is felt more limited, especially due to the way natural gas tariffs are determined. On the other hand, in our market, which is approximately 70 percent dependent on foreign currency, the effect of the high exchange rate is felt very strongly.” he said.

Households are the real victims of the high producer price.

Underlining that the injustice in reflecting the increases in costs to consumers will harm the households the most, Crimea continued as follows: “The increase in the number of consumers within the scope of the Last Resource Supply Tariff means higher electricity bills for more producers and workplaces. Because this tariff is determined directly depending on market costs, electricity prices of the users within the scope are directly affected by cost increases. Thus, it is aimed to keep the electricity bills of the households lower while the increasing electricity costs are burdened to the workplaces and producers. Although this approach seems correct at first glance, it is actually quite dangerous for both the consumer and the country's economy. Although electricity prices for residences are low, production costs increase with the reflection of the necessary increase to the producer, thus increasing the price of all consumption products. Even though households will pay relatively high electricity bills, exorbitant price increases in other consumer products can be prevented by reflecting electricity costs equally to all subscriber groups.

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