Klub 500: Changes Promoted by URSO Will Be Devastating for Slovak Economy

Bratislava, 9 July (TASR) - A radical overhaul of Slovakia’s electricity imbalance settlement system proposed by the Office for the Regulation of Network Industries (URSO) will cause millions in damages, threaten jobs and undermine the competitiveness of Slovak industry, the Klub 500 business association warned on Wednesday. The group called the proposed changes a form of "collective punishment" for the entire market. URSO announced on 1 July that it plans to introduce a new system requiring companies to pay for every discrepancy in their electricity production or consumption estimates. The changes are scheduled to take effect as of 1 August, giving businesses only a few weeks to prepare. Business leaders criticised the regulator for pushing the proposal forward without consulting affected stakeholders or conducting expert discussions. They also argued that the move violates the principles of transparency and predictability in the regulatory environment. "Slovakia produces more electricity than it consumes, yet our companies face some of the highest prices in the region. Instead of addressing this key barrier, URSO is introducing another poorly designed measure that will only raise costs, harm industry and kill investment incentives,” said Executive Director of Klub 500 Tibor Gregor. URSO stated that the change is necessary to reduce the negative impacts expected after Slovakia’s electricity transmission system (SEPS) joins the EU platforms Picasso and Mari for cross-border balancing energy procurement later this year. The regulator aims to curb speculative behaviour on the electricity market. Imbalances occur when a market participant supplies or draws electricity in amounts that are different from their contracted amounts, forcing the system operator to compensate instantly. Klub 500 estimates that the change could raise annual costs for large industrial firms by millions of euros. The association also rejected URSO's claim that the change would lower electricity prices. "If the regulator pushes through these destructive measures, it will not only be an attack on industry but also a direct blow to the stability of the Slovak economy," the group stated. The association called for an immediate halt to the process and warned that if the change proceeds, it is prepared to defend the interests of Slovak industry through all available legal and institutional means, including actions at the international level. mf/df