FINANCE

Bigger energy subsidy pledged

bigger-energy-subsidy-pledged

The Environment and Energy Ministry has again doubled the subsidy offered to electricity consumers, increasing it from the 9 euros per month announced in September and €18 promised in October to €39 pledged on Wednesday. However, the ministry is yet to regulate the way those subsidies will reach consumers.

Minister Kostas Skrekas announced that the soaring global electricity rates are forcing the government to further increase the monthly subsidy for power bills, which will be even greater for vulnerable households.

However, even the €39 monthly subsidy for November and December will only cover half of the hike from the soaring wholesale rates, which for the first 10 days of November averaged out at €208 per megawatt hour. At that rate, consumers of 400 KWh in November would pay an extra €80, with the state only covering €39 of that.

The burden of subsidies has been passed on to suppliers for now, as they are covering the rate discounts promised, even though they have not yet seen a ministerial decision regulating the amount and the terms and condition for the subsidy’s provision; they just rely on the public announcements made. The state will also have to notify the European Commission, as this may well require regulatory approval.