How electricity has become more expensive for us

"The control and regulatory institutions of the state do not work and companies with significant market power do what they want in practice," Paroubek said.

- iHNed.cz

The CSSD wants to restore price regulation in fields such as energy, water, gas and others. He argues, among other things, that the price of electricity in the Czech Republic has risen by 2006 percent since 122. Let's take a closer look at the price of electricity for households.

Change in electricity prices and change in wages
Comparison of growth in electricity prices and wages from 1989 to 2008

Let's look at the graph above. In it, we observe the development of the average wage and electricity prices compared to 1989. Note that the red line, which shows the growth of electricity prices, is mostly (with a few small exceptions) below the blue line, which shows the growth of wages. More precisely, in 2008 the price of 1 kWh for households was higher by 581%. However, wages were on average 631% higher. It is clear that wages grew faster than the price of electricity most of the time.

Average wage / price of electricity
The average wage divided by the price of electricity - how much more or less electricity could we buy from the salary, ie - did electricity become more expensive or cheaper?

The second graph is - although it may not seem so - more telling. It shows us the difference between the growth rate of wages and the growth rate of electricity prices. The higher the blue line, the faster wages grew compared to rising electricity prices, and the cheaper electricity was in real terms.

At first glance, it is clear that the cheapest was electricity in 1997, when it was cheaper by 39%, followed by 1995 (cheaper by 27%) and 1991 (cheaper by 19,5%). The most expensive was electricity in 1992 (by 13% more expensive), 2002 (by 3,2% more expensive) and 2000 (by 2% more expensive). It was also more expensive in 2001 (1,6% more expensive).

The Social Democracy, of course, blames the ODS for rising electricity prices. So let's see under which governments electricity has been cheaper or more expensive over the past twenty years:

YearChange in electricity prices
19903,6% cheaper
199119,6% cheaper
199213,1% more expensive
19935,1% cheaper
199412,8% cheaper
199527% cheaper
19961% more expensive
199738,6% cheaper
199811,6% cheaper
19999,4% cheaper
20002% more expensive
20011,6% more expensive
20023,2% more expensive
20037,5% cheaper
20049,6% cheaper
2005by 13,3% cheaper
200610,5% cheaper
200710,6% cheaper
20088,5% cheaper

The governments of the Social Democracy therefore hold one interesting primacy - under their governments, the longest period was when electricity was indeed more expensive than in 1989. This is the period from 2000 to 2002.

At present, therefore, electricity is still there 8,5% cheaperthan in 1989. Is it therefore necessary to increase regulation in the electricity market?

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