Economist: Ten-Percent Energy Price Spike to Boost Inflation by 0.5 Percent | Beta Briefing

Economist: Ten-Percent Energy Price Spike to Boost Inflation by 0.5 Percent

Source: Beta
News / Politics | 20.07.22 | access_time 15:15

Electricity (Free Image)

If households power bills rise ten percent, Serbia’s inflation rate will add 0.5 percent, Ivan Nikolic, an economist, said on July 20.

“It’s a direct impact on inflation, but there’s also an indirect one, when the opportunity is used to have higher prices than necessary,” Nikolic explained in an interview for the Danas paper. Serbian President Aleksandar Vucic said two days ago that he would “see to it that an increase in electricity prices should not go over ten percent.”

According to an energy expert of the Deloitte consulting firm, Zeljko Markovic, it won’t be enough to cover the production costs that Elektroprivreda Srbije (EPS) power utility incurs, but there’s also a social policy to take into account.

“The suggested ratio refers to households, but I expect that businesses will need to pay more. My estimate is that they might have to pay between EUR90 and EUR100 per megawatt-hour, instead of EUR75 they pay now,” Markovic said.

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