Wholesale electricity cap deadline extension sought

The energy ministry has taken action aiming to secure extensions for two energy-crisis protection measures, a wholesale electricity cap and freeze of indexation clauses, beyond approaching deadlines.

As part of the effort, the ministry has lodged an application to the European Commission for an extension of a recovery mechanism concerning windfall profits gained by electricity producers in spot markets.

If this application is approved by Brussels, day-ahead and intraday market inflow into the Energy Transition Fund will be maintained. However, this ETF inflow has, in more recent months, been limited by significantly lower wholesale electricity prices. Inflow in March was limited to 56 million euros, just a fraction, for example, of an 878 million-euro amount generated by the windfall profit recovery mechanism for the ETF last August.

Brussels’ approval of the application would pave the way for the suspension of an indexation clause concerning retail tariffs throughout 2023.

The European Commission has already given the green light to Spain and Portugal for extensions, until the end of 2023, of measures taken by the two countries to contain wholesale energy prices. The validity of these measures was due to expire in March.

Under current terms, Greece’s mechanism enabling the recovery of windfall profits gained by electricity producers is set to expire on June 1.