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Croatia adopts 636 million euros package to mitigate the growth of energy prices

Croatia’s Prime Minister Andrej Plenković has presented a 4.8 billion kuna package [approximately 636 million euros] to mitigate the growth of energy prices. 

Overall, he mentioned several causes for the rise of gas prices. First of all, the greater demand due to the coronavirus pandemic; second, the lower gas supplies from Russia, while European producers like Norway are unable to increase the domestic amount of gas; finally, colder winters due to climate change.

“Europe imports 61 per cent of its total energy needs, 90 per cent of which is gas,” Prime Minister Plenković said, adding that gas is also used for electricity production (20 per cent), for industry and transport (25 per cent) and for households (46 per cent).

In the past six months, the increase in gas prices for households in the European Union has varied, with Romania registering the highest increase and the least registered in Croatia and Hungary.

“The average price of gas for households in the European Union is 120 euros per megawatt-hours (MWh), which is 2.8 times more than in Croatia,” underlined the Prime Minister.

Other than regulating the prices, Croatia can also count on a fifth of its energy consumption produced locally.

“This package of measures applies to households, companies and farmers. It is universal because it is aimed at all users,” Mr Plenković announced, saying that the measures will save 61 million euros for households, but state-owned power utility Hrvatska Elektroprivreda (HEP) will suffer the same drop in income.

Speaking about the expected outcomes of this package, Mr Plenković pointed out that electricity prices will grow up to 9.6 per cent (instead of 23 per cent) while gas will be up to 20 per cent (instead of 79 per cent). Moreover, the package will also address the most vulnerable energy customers, which are estimated to be over 90,000. The new measures will extend the number of eligible people who will receive vouchers for both electricity and gas bills.

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