CEZ launches a new product: "rainbow electricity"

The electricity provider CEZ has prepared a completely new and revolutionary product range, which is to be launched on the newly opened market at the beginning of next year. These include several types of electricity provision and supply, each of which is characterized by a distinct color and, more importantly, by a different price. Each color represents a different product, but by extension also a certain section of the output generated by CEZ power plants that cover the particular supply. CEZ will gradually start offering these different colors to potential customers in the course of the following weeks. The customer base consists mainly of distribution companies, licensed dealers and so called "authorized customers" - a total of approx. 60 large companies in the Czech Republic.

CEZ gradually began to introduce its new offer. It offered to provide the distribution companies with the cheapest product, so called yellow electricity. This is a broadband supply of electricity provided over the whole year (continuous supply of the same electricity volume 24 hours a day, 365 days a year) and generated by the most cost-effective sources owned by CEZ - nuclear power plants and coal-fired thermal power plants. The cost of the product amounts to 73 hallers per kWh, which corresponds with the prices for the new electricity supplies exported by CEZ (these are relatively lower, but we also calculate the custom fees which this supply is also subject to). The price of such supply on the market of our neighboring countries to the west and Poland ranges from 78 to 80 hallers/kWh. CEZ would even be able to offer substantially lower prices, thanks to the changes and cost-effective measures implemented last year, so that even the Czech consumers could benefit from our cheap production. If CEZ had not improved the crucial factors such as work productivity, added value, etc., it would not have been able to launch this offer at all.

CEZ gave priority to the distribution companies, because these represent the protected customers who have the right to choose their supplier. These customers account for 70 % of the market, which the distributors are liable to supply with the cheapest electricity available. The shipments which have not been used by the distribution companies will subsequently be offered to the other interested parties, i.e. licensed dealers, authorized customers and then again to the distribution companies. This scenario will be the same for the other products, which CEZ will be offering in the following months. The second product on offer will be broadband supply for weekdays, i.e. without Saturdays and Sundays. The total price of electricity supplied by CEZ (all the above products included) for the whole Czech market will be lower than in 2001.

"We introduced extremely low prices, which are substantially lower than the cost of electricity in the neighboring markets and almost reach the level of exported electricity. We believe that there will be a demand for this electricity, particularly in the domestic market, as we would not like to sell cheaper electricity abroad and supply Czech customers with more expensive electricity. Our efficient and cost-effective production should bring benefits especially for Czech consumers. The ultimate goal is to increase competitiveness of Czech enterprises" says Mr. Jaroslav Mil, the Chairman of the Board of Directors and the General Manager of CEZ

CEZ aims to outdo its competitors in the following four areas: low price (most important), reliable services (which are now taken for granted, but this will change with the first bankruptcy in this field, as was the case with banks, travel agencies or cooperative savings banks), ecological production (all power plants operated by CEZ comply with similar ecological requirements as their western competitors) and the fact that the electricity is generated exclusively in the Czech territory and relies on Czech suppliers (coal providers, engineering companies, etc.)

CEZ sees the newly opened market as an opportunity for valorizing the relatively cheap electricity generated by its power plants. However, this will only be possible if the Czech producers have the same conditions, on the domestic market and abroad, as the foreign producers.

CEZ will aim at making the market accessible to all potential customers, including households, as soon as possible. It will also aim to help create favorable conditions for establishing a long-term efficient and competitive power system in the Czech Republic, which would be used by domestic customers.

Ladislav Krizpress, spokesman of CEZ

5. 9. 2001