Serbia approves higher retail gas prices from September

SARAJEVO Thu Aug 15, 2013 8:09am EDT

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SARAJEVO Aug 15 (Reuters) - Serbian energy regulator AERS approved average increases in gas retail prices of 4.4 percent for households and 5.7 percent for all consumers including businesses from September.

The second increase this year will bring prices to 46.3 Serbian dinars ($0.54) per cubic metre (cm) of gas for households and to 42.9 dinars per cm for businesses, AERS said on Thursday.

A total of 33 small gas distributors wanted to adjust their tariffs after the government allowed Srbijagas, their main supplier, to raise wholesale gas prices by 6.4 percent on Aug. 6.

Srbijagas had sought the rise to help cover its mounting debts and increasing import costs. Chief Executive Dusan Bajatovic had said the firm was losing money because government-regulated retail prices were below the prices Srbijagas pays for imports from Russia, Serbia's main gas supplier.

But a move to raise energy prices is a sensitive political issue in Serbia, where the government is seeking to avoid social discontent as living standards sink.

In 2012, Srbijagas made a loss of more than 750 million euros ($995 million) due in part to overdue payments mainly from state-run firms undergoing restructuring. ($1 = 0.7538 euros) (Reporting by Maja Zuvela; editing by Jane Baird)

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