The paper analyzes technical and commercial losses of electricity in distribution networks. Technical and commercial losses bring large financial losses and affect the reduction of business performance of electricity distribution companies. Calculation of technical and commercial losses of electricity is based on well-researched and scientifically confirmed methodologies. The paper contains an analysis of technical and commercial losses of electricity consumed by Pogona Omiš (Elektrodalmacija Split). Commercial losses are the result of a combination of intentional acts of the electricity buyer and unintentional inaction of the electricity supplier. Measures were proposed to reduce technical and commercial losses of electricity.