The Surprising Reality of Electricity Costs in the Czech Republic

Despite wholesale prices returning to the levels of three years ago, Czech households are still paying thousands more for electricity compared to prices before the energy crisis. This situation persists even as experts agree that retail prices will decrease, but not to the levels seen before the crisis.

Analyst Jiří Tyleček from XTB points out that while the price of electricity is declining, the distribution cost has significantly increased. Consequently, he believes we will not return to the pre-crisis level of end-user prices.

In June 2021, electricity on the exchange was around 70 euros per megawatt-hour. Now it’s about the same, and half less than last year. However, the tariff of the largest supplier, ČEZ, looks different. While in 2021, the indefinite Basic tariff in Central Bohemia was 4.80 CZK in normal mode, it is now about 8.12 CZK. The annual difference is over 8000 crowns for an average consumption of 2500 kilowatt-hours.

Regulated payments for renewable sources have also returned to the regulated part, at 60 haléřů for each kilowatt-hour consumed. With the changes in energy towards green sources, a lot of investment is needed in the network. “In the coming years, it will continue to grow,” added Tyleček.

Household prices react to the changes in the exchange price with a delay. “It takes several months before it is reflected in the price lists,” says Tyleček. Meanwhile, analysts predict that consumer prices will continue to drop, but it will not be as they used to be.