Oil price plunge to lower Public Service Compensation

The Public Service Compensation (YKO) surcharges included on professional and household electricity bills – to cover high-cost electricity production on non-interconnected islands as well as supply for vulnerable social groups – will be lower for this year compared to previous years as a result of the drastic drop of crude oil prices in the international market over the past few months.

RAE, the Regulatory Authority for Energy, sets the annual Public Service Compensation amount for each year.

Based on current conditions, the Public Service Compensation amount to be set for 2015 will be roughly 100 million euros lower.

RAE had set the Public Service Compensation amount at 811 million euros for 2012 and 819 million euros for 2013.

The main power utility PPC owes the Public Service Compensation fund about 450 million euros for surcharges concerning 2012 to 2014. PPC still needs to collect 290 million euros of Public Service Compensation from electricity bills concerning 2012 and 2013 as well as approximately 150 million euros for 2014.

Although PPC has officially acknowledged owing the fund the aforementioned amounts for 2012 and 2013, the power utility has had trouble receiving payments from consumers for outstanding electricity bills.

This was one of main reasons why the power utility decided, just weeks ago, not to go ahead with generous electricity tariff reductions for consumers.