Around a month following the electricity price cap was extended until the end of 2024, the responsible ministries are continuing to negotiate an adjustment to the subsidy. This will be the subject of public discussion once more on Wednesday. The OÖNachrichten reported on December 13th that halving the funding was being considered.
In order to stimulate competition on the electricity market, discussions are currently underway regarding the amount of the reference amount, the Ministry of Energy is now quoted in Ö1. Wifo boss Gabriel Felbermayr considers a rapid halving of the funding from 30 to a maximum of 15 cents to be ideal.
“On the one hand, this should make the electricity price brake cheaper for the Ministry of Finance, and on the other hand, it should ensure that there are more incentives for households to change their electricity provider if the 15 cents are not enough to bring the electricity price to bearable levels,” said Felbermayr. He also pointed out that electricity prices are tending to fall.
Subsidy for 2900 kWh of electricity until the end of the year
The first 2,900 kWh of electricity per year will be subsidized for every household until the end of the year. Households should only pay ten cents per kWh. The subsidy is currently limited to a maximum of 30 cents. If the price of electricity rises above 40 cents, households will also have to pay amounts beyond this. The price of electricity has now fallen sharply once more, although not yet to pre-crisis levels.
An adjustment of the electricity price brake can only be done in agreement with the Ministry of Finance. It remains unclear when a decision will be made.
“The electricity cost subsidy primarily protects consumers who have an electricity tariff with a high labor price. Citizens who choose an electricity tariff with a low labor price receive less support from the state,” criticizes Monika Köppl-Turyna, director of the economic research institute EcoAustria. The funding also weakens competition between energy supply companies.
