Czech electricity prices: monthly fixed price is now the priciest

Czech households on a monthly fixed electricity price are paying more than 6,000 CZK per MWh before VAT in November. That is two to three thousand crowns more than under long-term contracts of several years or for an indefinite term. In spring and summer this product was the better deal, but in autumn the situation flipped.

How the price is formed

With a monthly fix, the price is tied to the next-month contract: in October the supplier buys electricity for November. As Jiří Matoušek, marketing director at Centropol, explains, the November price reflects not the November market but a purchase made in advance.

In January and February of this year, customer prices exceeded 4,000 CZK. Then, as wholesale prices went up, they paradoxically fell to almost half of today’s level, stayed above 3,000 CZK from March to August, and then jumped sharply. According to Matoušek, two factors coincided in autumn: rising wholesale prices and more expensive energy for the autumn and winter months.

Suppliers’ figures

According to the Pražská plynárenská price list, the price including VAT rose from 3,036.79 CZK in April to 6,391.52 CZK in November and 6,626.03 CZK in December. At Centropol, November costs 6,558.89 CZK. Tedom has already published its December tariff: 7,815 CZK per MWh including VAT.

According to Pražská plynárenská, the average price under monthly-fixed contracts is currently 4,277.2 CZK per MWh including VAT, a few hundred crowns higher than with a fixed price for one to three years or an indefinite term. Since January, roughly 25 percent of customers have left this product, company spokesman Miroslav Vranek said. These are usually households consuming about two MWh a year.

What experts advise

Jakub Odložilík, director of Tedom energie, points to an advantage of the product: the price reacts quickly to falling costs too, while the downside is that it is just as sensitive to crises, such as the war in the Middle East. In his words, the benefit should be judged over a full year. Some customers are already moving to short-term fixes, usually for a year.

Expert Havor believes prices have reached the level that was capped at 5,000 CZK before VAT in 2023. He calls betting on a fall in prices a gambler’s game, and personally recommends a two-year fix: he believes the war in the Persian Gulf will end and energy will get cheaper.

Around Prague, based on reporting by seznamzpravy.cz