The Environment and Energy Ministry, in search of political gains, appears determined to push for a reduction of surcharges that appear on main power utility PPC’s electricity bills for households and businesses. The ministry has also asked PPC to fully explore the possibility of reducing its electricity tariffs rates offered.
Surcharges, which include network fees, a RES-supporting ETMEAR charge, and Public Service Compensation (YKO), make up about half of total electricty bill amounts.
Whether PPC is in a position to be able to reduce its tariff prices remains to be seen, as the utility is faced by both positive and negative developments.
On the one hand, the utility has benefited from lower production costs as a result of reduced fuel price levels, including natural gas. In addition, last week’s elimination of a special consumption tax (EFK) imposed on natural gas, an initiative included in a super bill of bailout-required measures, will end up saving the utility about 85 million euros in tax payments.
On the other hand, besides needing to deal with an alarmingly high level of unpaid receivables, PPC must also cope with the prospect of revenue losses following the upcoming breakaway of its subsidiary firm IPTO, the power grid operator, market share losses, and NOME auctions, all bailout-related requirements.
The NOME auctions will provide third parties with access to PPC’s low-cost lignite and hydropower sources to help break the utility’s dominance.
At this stage, the energy ministry is examining the prospect of offering a 10 percent discount on electricity rates to households with punctual electricity bill payment records, plus ETMEAR and YKO surcharge reductions, energypress sources have informed. Consumers now servicing their PPC electricity bill debts through installments will also be offered the 10 percent discount, sources said.
PPC must drastically reduce its market share to less than 50 percent by 2020 as part of the country’s bailout agreement with creditors.