Abstract

In the last two decades the electricity prices (taking in account specific sample – the electricity prices for industrial use between 500 MWh up to 2000 MWh annually) have been strongly oscillating. During this period electricity supply was transformed from infrastructural to market activity. In the process, prices of electric power first fell sharply and then started to grow. In Germany and Slovenia, the period of declining prices lasted for seven years. In the new framework electricity prices are increasing in business cycle expansion, and declining during downturn. The analyzed period after 2002 as a new steady state on electricity market with demand and supply behaving under the market conditions, German electricity prices (our specific sample) were growing on average for more than 4% per year.

In spite of the fact that the electricity prices fell in recession, there is no doubt that their growth is going to recover together with the recovery of the economy. The electricity prices growth will be stable and to some extent slower than (Germany) or equal to (Slovenia) the growth of real GDP. The electricity power prices will also increase relatively to general level of prices (presented by harmonized index of consumer prices).

By the liberalization of its electricity supply sector Slovenia entered to a wider market of this commodity. The balanced electric power prices on this market can be quite accurately observed by looking on German prices. Having in mind our sample changing German prices of electric power for 1% causes the change in Slovenian electricity prices for 0.8% in the same direction.

Key words
Energy, Macroeconomics, Natural resources, Economic development, Supply, Demand, Prices

JEL
E31, O13, Q41, Q43