Factsheet for measure
HR-2022-40/2826
–
Updated
– measures in Croatia
Energy price control for households and selected businesses
Mjere za ublazavanje porasta cijena energenata
Background information
With the rise of inflation caused by the war in Ukraine, the government responded with a variety of aid measures. Many sectors across the economy were impacted by inflation that raised the price of energy. Households and businesses were significantly affected by these high prices. The government established measures to protect households, companies and the domestic economy from continually rising prices.
Content of measure
The first part of the package mitigated the rise in energy prices by capping electricity prices. This measure was originally in place from 1 October 2022 to 31 March 2023 (see updates for extensions).
Initially, the measure was intended only for households, but a cap was later set also for private companies and public entities, although slightly higher the household rate.
The measure allowed households to pay €59 per megawatt-hour for consumption of up to 2,500 kilowatt-hours of electricity and €88 on average for consumption above that threshold.
Kindergartens, schools, universities, retirement homes, non-governmental organizations, religious communities, municipalities and towns. They will be subject to a universal tariff of €62/MWh.
Businesses that consume less than 250,000 kWh over the mentioned period will pay €0.07 per kWh, and those that use more will pay €1.76. Large consumers that use more than 2.5 gigawatts will be subject to a tariff of €250/MWh.
Updates
The following updates to this measure have been made after it came into effect.
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19 September 2023
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The Croatian Government on 14 September 2023 announced its decision on price caps on energy for another six month period from 1 October 2023 to 31 March 2024. The price of electricity for households was set to remain the same, but the semi-annual threshold has been raised from 2,500 to 3,000 kWh. The price for the first 3,000 kWh is €59 for one MWH, while above 3,000 kWh is €88 for one MWH. The measure in value €102 million relates to 2.2 million households.
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09 May 2023
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The Croatian government unveiled a €1.7 billion package of measures to support households and the economy amid the ongoing global energy crisis and rising prices. A total of €1.18 billion are envisaged to soften the impact of growing energy prices. This measure will help to keep unchanged the price of electricity for households, the public institutions and non-profit sector, small businesses and entrepreneurs until the end of September 2023. Some €150 million will be set aside to help keep unchanged natural gas prices for households, the public institutions and non-profit sector by the end of March 2024 (effectively extending the measure from its previous end date of 31 December 2023) and for companies with average annual consumption of up to 10 GWh. The government, on 16 March 2023, decided that from 1 April 2023 until 31 March 2024, 69,000 vulnerable people will have the right to the increased monthly fee for covering the costs of electricity, gas or thermal energy. The monthly fee increases will amount to €70, while the total value of the measure is €36 million. Vulnerable groups are receivers of: personal disability benefit, guaranteed minimum benefits (one form of social welfare aid), national benefits for the elderly persons (for persons who are not eligible to the regular pension because they did not work at all or worked less than required 15 years), financial benefits for unemployed Croatian veterans from the Homeland War and civilian victims of the Homeland War. They will continue to have the right to compensation for the housing cost, communal fees, heating and water services. Furthermore, for providers of social service, compensation for mitigating the increase in energy costs was introduced. They will be paid from €70 to €540 per month, depending on the number of users. Providers of home help services will receive from €70 to €80. Providers of accommodation, organized housing and residence services from €140 to €540. The value of the measure in total is €4 million. Currently, 506 service providers are covered by the measure.
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Use of measure
No available information.
Target groups
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Workers
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Businesses
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Citizens
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Does not apply to workers
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Applies to all businesses
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Applies to all citizens
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Actors and funding
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Actors
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Funding
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National government
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National funds
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Social partners
Social partners' role in
designing the measure
and form of involvement:
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Trade unions
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Employers' organisations
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Role
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No involvement as case not in social partner domain
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No involvement as case not in social partner domain
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Form
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Not applicable
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Not applicable
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Social partners' role in the
implementation, monitoring and assessment phase:
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No involvement
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Main level of involvement: N/A
Involvement
Due to the nature of the measure, social partners were not directly involved in the adoption and implementation of the measure.
Views and reactions
Social partners, particularly trade unions, generally support measures which are directed towards the mitigation of increase of energy price. The Union of the Autonomous Trade Unions of Croatia (UATUC) supports the new package of measures to help citizens and the economy as a step in the right direction. However, the UATUC warns that certain measures should have been better designed. According to their opinion, the key issue remains the growth of wages in the private and public sectors, which can protect the living standards of workers and without which Croatia cannot win the battle with the current crisis.
The Croatian Employers' Association is fully aware that the incredible increase of energy prices is unsustainable for each entrepreneur without serious consequences. Therefore, the CEA fully supports the limitation of energy prices.
Sources
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08 September 2022: Paket mjera za ublažavanje porasta cijena energenata (The package of measures for lessening the increase of energy prices)
(vlada.gov.hr)
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08 September 2022: Misljenje sindikata o mjerama (The opinion of the trade union on measures)
(www.vecernji.hr)
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08 September 2022: Vladin prijedlog o otklanjanje poremećaja na domaćem tržištu energije (The government's proposal on eliminating disturbances on the domestic energy market https://vlada.gov.hr/UserDocsImages/2016/Sjednice/2022/Rujan/147%20sjednica%20VRH/147%20-%201.docxhttps://vlada.gov.hr/UserDocsImages/2016/Sjednice/2022/Rujan/147%20sjednica%20VRH/147%20-%201.docx
(vlada.gov.hr)
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08 September 2022: HUP podržava mjere za ograničavanje cijene energenata (CEA supports the limitation of energy prices).
(www.hup.hr)
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15 September 2023: Price cap for energy (Ograničavanje cijena energenata)
(narodne-novine.nn.hr)
