Why is electricity becoming more expensive? 3 facts from the last committee meeting

The end of price freezing is not just a theory

During the committee session on November 6, 2024, it was clearly stated that the current protective shields will not be maintained in the same form. So far, we have been paying about 412 PLN per megawatt-hour, but the actual cost of production is much higher. Officials and MPs discussed a new threshold, which is to reach nearly 597 PLN. For a typical household in a block of flats consuming an average of 146 kWh per month, this means a real jump in expenses of about 32 PLN on every bill.

Many of you ask why the state cannot continue to subsidize the same amount. The answer from the committee was brutal: the 2025 budget is short by over 4.3 billion PLN for this purpose. Without fluff – the government must choose between electricity subsidies and other social spending. This is not pleasant news, but these are the facts coming from the Sejm corridors. Simply put: electricity will be more expensive because the time for artificially maintaining low rates, which we as a state can no longer afford, is ending.

The situation is dynamic because the ministry is still trying to find savings in the so-called transmission fee. However, even if they manage to save a few pennies there, the price of energy itself will still go up. We checked at the source – draft bills are already being read, and no one plans a full 1:1 extension of the current rates. That's it regarding the price freezing that is so frequently heard about in the news.

The 2025 budget is missing over 4.3 billion PLN to continue electricity subsidies in their current form.

The capacity fee returns to our bills

The second fact that escaped many media outlets is the restoration of the capacity fee from January 1st. For the last six months, it was suspended to zero, which gave us a false sense of savings. At the committee, it was confirmed that from the new year, this item will reappear on the invoice. It will be an amount of around 11.44 PLN net per month for most single-family homes. It seems like little, but on an annual scale, it's an additional 137 PLN that we pay just for the power plants being ready to work.

Network operator representatives argued during the meeting that this money is essential for maintaining system stability. A system that is aging and often cannot handle new energy sources. One expert pointed out that in the Łódź region alone, there were 14 minor transmission failures in just one week of October. These 11 PLN per month are meant to be a band-aid for these problems, but for us, it's just another tax hidden in the bill.

It's worth looking at your old invoices from 2023 and finding the 'capacity fee' item. You will then see exactly how much was disappearing from your pocket before. Now this amount will be about 8% higher than a year ago. No fluff – this is a pure cost of maintaining infrastructure that cannot be ignored, even if you produce your own electricity from panels but are connected to the grid.

Network modernization, or why we pay for cables

The third fact from the committee concerns the state of our wires and transformers. It turns out that nearly 37% of the transmission infrastructure in Poland is more than 43 years old. This is a massive problem because the old network does not accept power from wind turbines and photovoltaics as it should. During the proceedings, a specific number was given: we must spend at least 8.4 billion PLN on local lines so that fuses stop blowing in entire villages on sunny days. These expenses will be passed on to us in distribution fees.

Everyone who has a meter pays not only for the energy itself but also for its delivery. At the committee, it was announced that distribution tariffs will increase by about 14.3% in the coming year. This is the result of these necessary repairs. If you live in an older block or in the suburbs, these investments are crucial for you so that electricity flows at all, but the price for this certainty is simply high. Simply put: we are paying for years of neglect in network maintenance.

We spoke with one of the engineers after the meeting ended. He admitted that without this money, in 2-3 years we would have regular power outages, especially in smaller towns near Warsaw or Poznań. The choice was therefore simple but painful for the household budget. The increase in distribution fees is a fact we must accept when planning expenses for next March or April. So much for the technical causes of the price hikes.

Nearly 37% of transmission infrastructure in Poland is more than 43 years old, which forces costly repairs.

How to prepare your wallet for these changes?

Since we already know how much more expensive it will be, it's worth thinking about specific steps. Tariff analysis shows that switching from the universal G11 tariff to the dual-zone G12 can save about 19-24 PLN per month if you learn to set the washing machine or dishwasher after 10:00 PM. The committee also mentioned a new system of energy vouchers for the poorest. About 156,000 families are to benefit from it, but the income criteria will be very strict.

For the average family that doesn't qualify for aid, the only way out is to monitor consumption. We checked at the source: replacing 5 old light bulbs with LED equivalents pays for itself after just 3 months with the new electricity prices. These are small amounts, but with a cumulative increase of about 45 PLN per month, every saving matters. No fluff – there are no miracles; electricity will be more expensive, and we must start counting every kilowatt-hour.

Summarizing what happened at the energy committee: harder times are coming for individual consumers. Changes in tariffs, the return of the capacity fee, and necessary network investments are a cocktail that will drive up our bills. We hope that this summary of facts will help you better plan your home budget for 2025. Simply put – knowing exactly what we are paying for is the first step to smaller losses. That's all on the topic of electricity price hikes.