In particular, the support will be provided horizontally, i.e. to all households and residences (main, country), while it will cover monthly consumptions up to 500 kilowatt hours. The amount of the subsidy will be announced at the beginning of August, when the charges of their variable products for the following month will have been finalized by the suppliers, while the aim is to subsidize the price of electricity for more than 15 cents per megawatt hour. At the same time, the aid to the beneficiaries of the Social Household Tariff will be greater than that for the rest of the household consumers.
Without the subsidy, the price of the kilowatt hour if the same discount moves so far to 19 cents, from 13.5 cents it was in July.
Unlike what he had happened in the previous 2 yearsthe increase in the wholesale price of electricity is not due to cost of production.
The European price of natural gas remains at 31 to 32 euros, even cheaper Russian gas has overwhelmed the Balkan markets.
But as the price for electricity is defined by the stock marketthe increase in demand in the evening hours from Hungary and the Romania with which Greece is indirectly connectedraises the hourly sale price of the megawatt hour even to 760 euros.
Part of these skyrocketing profits will be taxed to finance the subsidies.
Electricity: The 3 measures that the government actually announced – August subsidies and fluctuating tariffs
The Minister of Environment and Energy, Thodoros Skylakakis, announced a triple grid of support for consumers from increases in electricity bills.
Current: The three extraordinary measures to be exact
- Emergency reinstatement of the fee for electricity generation with natural gas. It will be imposed temporarily, for at least two months. The exact height will be announced in the next few days.
- Household subsidy for August, with an amount to be announced in the next period “to have an idea of how prices will move”. The subsidy will concern the green and yellow tariffs.
- Incorporation of the new European directive into an emergency intervention mechanism for distortions that have endemic characteristics.
The Deputy Minister of Environment & Energy, Ms. Alexandra Sdoukou pointed out that the money that will be collected from the imposition of an extraordinary tax on natural gas energy producers will be channeled to the Energy Transition Fund. The floating tariffs (ie yellow and green) are the ones that will receive the August subsidy. At the moment, the amount of the subsidy cannot be announced, however as Ms. Sdoukou pointed out, the consumption limit of the subsidy for domestic consumers will be 500 kilowatt hours. Finally, he emphasized that social tariffs will be subsidized with higher prices.
Current: What happened following July 11 and we had increases?
As Mr. Skylakakis explained, we had the combination of a prolonged heatwave, an unexpected heatwave from Ukraine to the Balkans, increased demand from Ukraine due to the war, no easing of demand from Hungary and Romania to the West. The duration of this phenomenon is predicted to last for a few more days. Judging by the futures, we will not have a continuation of the phenomenon in August.
What are the consequences? We have a jump in prices around 180 and in the evenings when the photovoltaics are not working around 600.
The Minister of Environment and Energy explained that it is not possible to activate an emergency mechanism, due to the European conditions that have been set, but the government cannot remain with its hands tied, especially when there are so-called “skyrocketing profits”. For this reason, he decided to react with three more moves.
“The mechanism for imposing a ceiling on producers’ incomes is over, it has been completed. The new directive provides for an emergency mechanism but has conditions that cannot be implemented at all. He wants the crisis to last three months to be implemented. The government obviously cannot stay with its hands tied for a responsibility that is not ours. And we cannot stand idly by in what we call ‘skyrocketing profits,'” he noted.
The minister noted that in the wholesale electricity market the rise continues today with a new high price of 218.77 euros per megawatt hour, with the maximum hourly price recording a new record at 759.92 euros per megawatt hour.
Regarding the colored tariffs, Mr. Skykalakis noted that “which one we choose depends on our energy profile”. In the green tariffs, the prices in January were also lower than in December when we had subsidies. Then we had a drop in prices in the spring. In July the price rose once more and reached marginally above January, but remained very low.
Thodoros Skylakakis also urged all farmers to join “yesterday” the special GAIA tariff, which guarantees them pre-crisis electricity prices for two years.
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