Slovak regulator sees smaller 2007 power price hike

BRATISLAVA, Nov 8 (Reuters) - The Slovak utilities regulator (URSO) expects electricity prices for households to rise less next year than distribution companies are demanding, URSO chief Karol Dvorak said on Wednesday.

Increases to utility prices have pushed inflation up sharply over the past year, posing a risk for Slovakia's ambition to adopt the euro in 2009.

Distributors have submitted requests for price rises between 12.4 percent and 13.5 percent from January 2007.

"The increase will be definitely lower. We won't accept these requests for sure," Dvorak told Reuters.

On Wednesday, local media quoted an URSO spokesman as saying the price rise could be half the amount demanded by distributors.

Dvorak declined to give a more detailed estimate on what he sees as the likely price increase because of ongoing talks with distributors and power producer Slovenske Elektrarne <ENEI.MI>.

The regulator is expected to announce its final decision by end-November.

The central bank (NBS) has raised its key rate by 175 basis points to 4.75 percent this year to curb consumer inflation, which stood at 4.5 percent by EU standards in September.

The bank said on Tuesday Slovakia should meet euro entry inflation criteria with room to spare, and on a sustainable basis. The NBS cut its end-2007 inflation prediction, but at 2.6 percent, it was still above the bank's target of 2.0 percent.

In September, URSO approved a 4.3 percent rise in gas prices for households from November, well below a request for a 15 percent jump by dominant natural gas company SPP.

But Prime Minister Robert Fico said last month SPP had proposed cutting gas prices for households by an average of 3.07 percent next year due to a decline in oil prices and sharp firming of the crown currency.

((Reporting by Martin Santa; editing by James Jukwey; Reuters Messaging: martin.santa.reuters.com@reuters.net; +421 5341 8402))

Keywords: UTILITIES SLOVAKIA ELECTRICITY