ÚRSO intends to cut power distributors’ profits

Regulator ÚRSO intends to cut electricity prices by reducing distribution fees. It is therefore reducing the weighted average cost of capital of regional distribution monopolies from this year’s 6.47% to 4.36% in 2022. It argues the cut reflects lower interest rates in the euro zone. Distributors point out that the 4.36% rate is lower than in Germany, Czechia or Austria, and they need high profits to invest in smart grids.

In 2018-20, distributor SSE posted an average net profit of €97m on €433m sales (net profit margin of 22%), ZSE profit of €72m on €449m sales (16%) and VSE €34m profit on €268m sales (13%). SSE is controlled by Czech EPH, while Germany’s E.ON controls ZSE as well as VSE.

(hnonline.sk)