Why power bills have soared

Why power bills have soared

Greeks still pay far more than the European Union average for their electricity, despite the subsidies that cover up to 85% of hikes, which proves that the causes of the swollen bills are also domestic and not just imported.

The Eurostat data on energy inflation in May serve to illustrate that reality, with rates in Greece being almost twice the eurozone average.

Provisional figures show that energy inflation in Greece reached 60.9% on an annual basis last month, against a European average of 39.2% Greece recorded the third greatest increase among the 13 countries that submitted data in May, only trailing the Netherlands and Belgium – countries with a high dependence on Russian gas. France, which has nuclear power stations, had an increase of 28.9%, far below the EU average.

The definitive statistics for April showed bills in Greece rose 57.6% year-on-year, against a European average of 37.5%%. Comparison with other countries of the European south is staggering, as the index rose 33.3% in Spain, 30% in Bulgaria and 27.1% in Portugal.

The data reflect the general problems of the energy crisis and the high cost of energy products that feeds eurozone inflation, and the differences in the national electricity market structure among various member-states; the same applies to liquid fuel, where Greece has steadily been among the top three countries with the most expensive markets. The figures’ disparity also explains the varying degree of urgency among European leaders regarding European support measures.

In Greece’s case, the structure of the electricity market is partly to blame for the hikes consumers face, while the relatively high taxes are mainly responsible for the soaring rates of gasoline and diesel: Greece has the third highest special consumption tax on gasoline (0.70 euros per liter), after the Netherlands and Italy, though in diesel it stands 15th, at €0.41/liter.

In electricity rates, the 40% share of gas in power production has contributed to the disproportionately higher increase in bills than the European average, while the delignitization program has not allowed lignite to replace gas.

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