New study underlines energy cost disadvantages for local industry

Energy intensive industrial companies in Greece are being charged one of the highest electricity rates in Europe, causing serious competitive disadvantages, according to a study conducted by strategic consulting firm Roland Berger on behalf of EVIKEN, the Association of Industrial Energy Consumers.

The study was not based on official Eurostat data, which, as underlined by EVIKEN, do not include discounts as well as other price reductions available for heavy industry, such as the steel, cement, aluminium, and ceramics sectors. Instead real market prices were taken into account.

A comparison of electricity rates available for energy-intensive industry, including discounts offered for “disruption management” policies ­– they enable energy cost savings for major-scale industries in exchange for a reduction in energy consumption whenever required by the system operator – showed that the price level was 48 euros per megawatt hour in Germany and Spain, 52 euros per MWh in Italy, and 62 euros per MWh in Greece.

The comparison was also negative for late-night flexibility rates offered to Greek industrial companies – just three at present – which are charged 45 euros per MWh, compared to 38 euros per MWh in Germany and 35 euros per MWh in Italy.

The study proposed a series of measures for electricity price reductions in Greece, among them a continuation of discounts offered by PPC, the Public Power Corporation, in the years to come; implementation of “disruption management” terms; reduction of non-electricity related surcharges such as taxes and tariffs, and the electricity market’s liberalization.

Resolving the high cost of energy in Greece would offer a boost to domestic industry, noted EVIKEN president Konstantinos Kouklelis.

“Every country protects its industrial sector with all available means. No matter what, we need to find a way towards achieving the electricity cost levels mentioned in the study,” Kouklelis stated.

The EVIKEN head noted that the Greek government eventually realized, two years ago, that industry cannot survive without lower energy price levels.

“Efforts made resulted in a natural gas price reduction of 8-9 percent, but a 30 percent difference has been maintained compared to other European markets,” the EVIKEN president pointed out.

A Roland Berger official, Pavlos Klonaris, noted that Greek industry is particularly burdened as energy cost – for energy-intensive industry – accounts for between 20 and 40 percent of total production cost.

EVIKEN General Secretary, Dimitris Kolaitis, noted that rival nations seek to conceal the competitive advantages held by their respective industrial sectors, as has been the case with Germany for many years now.