Ministry vs electricity hikes
Gov’t resorts to horizontal interventions in order to contain the growth of power rates
The government is trying to ease the huge burden on households and businesses from the increases in natural gas and electricity rates by introducing horizontal measures.
Energy Minister Kostas Skrekas announced on Tuesday that for July all residences without exception will have their power supply subsidized, without income criteria and for all levels of consumption. Specifically, all residential consumers will be subsidized with 200 euros per megawatt-hour, thus absorbing 84% of the increase, while the rate for vulnerable households will be €240/MWh, covering 100% of the increases. Total energy cost subsidies for July amounted to €722 million, up €300 million from the previous month.
As Skrekas said, “the selective reduction of natural gas flows from Russia to Europe was added to the sharp increases in energy rates. This is a completely negative development that has pushed natural gas prices to unimaginable heights. The mix is explosive and rightly makes European citizens and European leaders deeply worried. There is no doubt that dealing with this crisis is a historic challenge.”
All residences will be subsidized in July regardless of consumption as follows:
• A €200/MWh subsidy for residential consumers that covers 84% of the increase.
• A €240/MWh for social rate beneficiaries, which covers 100% of the increase among vulnerable groups.
• The subsidy to commercial consumers with power supply up to 35 kilovolt-amps (kVA) is increased to €192/MWh, absorbing up to 82% of the increase.
• Regarding rural tariffs, the subsidy amounts to €213/MWh, absorbing up to 90% of the increase.
• For the rest of commercial and industrial consumers with a power supply of more than 35 kVA, the subsidy amounts to 148 euros/MWh.
• For natural gas and professional and industrial consumers, the subsidy for July amounts to 30 euros/MWh.
The new package of subsidies for July will cost €722 million, while in total the subsidies since last September exceed €5 billion.
