A legislative amendment enabling the implementation of an electricity-price intervention mechanism has been prepared by the energy ministry and will soon be submitted to parliament for ratification.

The amendment includes the framework of a temporary compensation plan for electricity producers, offers details on price-cap formulas for respective electricity production technologies, and also sets a time period for these extraordinary measures.

According to sources, the mechanism will be implemented next month, on July 1, and remain effective until June 1, 2023, while a series of technical issues, including determination of compensation levels for electricity producers, will be set through ministerial decisions.

Natural gas and lignite-fired power stations will not exactly be subject to price caps, but algorithms taking into account a series of factors will be applied to control prices, the sources said.

Based on current market conditions, the upper-level compensation price for natural gas-fueled power stations has been estimated at between 220 and 230 euros per MWh.

An upper-level compensation price of between 85 to 90 euros will be set for RES producers, while a compensation price of 100 euros per MWh is expected for hydropower stations.

According to the plan, the Hellenic Energy Exchange will withhold the difference between the market clearing price and compensation amounts for electricity producers, transferring these amounts to the Energy Transition Fund. These amounts, along with related state budget sums, will be utilized for electricity-bill subsidies, the aim being to keep the average retail price of electricity at approximately 0.145 euros per KWh.