Suppliers face December losses as wholesale power prices rise

The great risk and uncertainty faced by electricity suppliers on a monthly basis as a result of being required to forecast wholesale prices for each forthcoming month in order to calculate and announce their respective retail prices for the one-month period has come to the fore.

At present, the overwhelming majority of electricity retail prices set for December by the country’s suppliers are below wholesale price levels expected for the rest of the month as a result of a price surge over the past few days, meaning suppliers stand to incur losses this month.

Under recently introduced rules, electricity suppliers in Greece are required to announce their respective retail prices for each forthcoming month by the 20th of the preceding month.

Suppliers had also faced unfavorable market conditions in August, when the pricing rule was introduced. However, losses incurred that month were smaller than those expected in December.

Just three electricity suppliers have announced December retail prices that stand a chance of being above the month’s wholesale price levels, now expected to reach levels of about 385 euros per MWh.

Month-to-month pricing obligation resulting in market ‘regression’

A leading Greek energy market authority has expressed strong reservations about the financial repercussions of a new pricing model imposed last July on electricity suppliers, concluding the new system will ultimately result in market regression, while also questioning the new system’s legal standing.

These reservations and concerns were expressed by Miltos Aslanoglou, general manager of ESPEN, the Greek Energy Suppliers Association, at the 2nd Energy Law Forum.

Under new market rules, electricity suppliers in Greece are required to announce each forthcoming month’s electricity prices by the 20th of the preceding month.

Measures decided on by authorities for implementation should be thoroughly designed to be effective under various conditions, not just specific circumstances, the ESPEN official stressed.

Had the pricing mechanism been introduced sooner, such as last April, when electricity prices were surging, the country’s electricity suppliers would most probably have been threatened by bankruptcy or even gone out of business, Aslanoglou contended.

Windfall earnings of suppliers, he noted, have created a strange combination where suppliers are spending funds from the previous month to service their portfolios for the next month at a time when market prices have fallen below projected levels.

Such a combination of events can only be circumstantial, the ESPEN official noted, pointing out windfall profits should be limited but based on the financial statements of companies, not pricing regulations.



Consumer moves to new suppliers down 20% in October

Consumer switches from one electricity supplier to another dropped by 20 percent in October, compared to the equivalent month a year earlier, latest data made available to energypress has shown.

Just over 80,000 consumers switched electricity suppliers in October, down from approximately 100,000 in the same month a year earlier.

The number of consumers who changed supplier in October was also lower compared to September this year, when 93,500 consumers shifted, a month-to-month drop of nearly 14 percent.

For the 10-month period between January to October, consumer shifts were up marginally, 2.5 percent, compared to the equivalent period a year earlier.

These latest figures indicate consumers are increasingly hesitant to move from one supplier to another, following more liberal behavior in the past.

Under recently introduced new rules, suppliers are required to announce prices for each forthcoming month by the 20th of the preceding month.

Monthly revisions of offers appear to be subduing the mobility of consumers, apprehensive of price changes from month to month.

December power prices to fall 20%, windfall tax ‘lacks clarity’

Most of the country’s electricity suppliers are preparing to announce December retail electricity prices of between 32 and 35 cents per MWh, down 20 percent compared to November, a reflection of lower natural gas prices at the Dutch TTF hub in recent weeks.

Some suppliers are set to go as low as just over 30 cents per MWh, the lowest retail power prices have been since August, when new rules were introduced requiring suppliers to announce prices for each forthcoming month by the 20th of the preceding month.

Given this requirement, helping consumers make price comparisons, suppliers must announce their December prices by midnight Sunday.

The anticipated price reduction will not result in lower prices for consumers. But the state, subduing the cost of retail electricity at 15 to 16 cents per KWh through subsidies, will benefit as it will be able to maintain this desired price level by contributing less.

Like in November, no state budget money will be needed for energy subsidies offered by the government, meaning it will have some leeway to subsidize other sectors, most probably auto fuel, once again on the rise.

On another front, suppliers have expressed complaints about a new windfall profit tax, set to be introduced over successive three-month periods, beginning with August to October. Suppliers protest the initiative’s formula lacks clarity and has increased the complexity of cost calculations.

Power suppliers windfall profit recovery plan proceeding

The energy ministry has just submitted to parliament an amendment for a mechanism designed to recover windfall earnings gained by electricity suppliers, initially from August 1 to October 31 this year.

The mechanism will be implemented repeatedly over additional three-month periods for as long as it is needed.

A universal windfall earnings level will be set as a benchmark. Earnings exceeding or falling below this level from month to month will be offset for each three-month period, according to the plan.

Electricity suppliers found to have benefited from windfall earnings will need to swiftly return 60 percent of amounts determined by the new formula, while payment of the remaining 40 percent will be expected at latter dates.

For the measure’s initial three-month period, electricity suppliers will need to return 60 percent of windfall earnings by December 23.

The energy ministry notes it has taken into account concerns raised by suppliers over factors shaping actual cost of electricity supply.


Suppliers to set lower December prices, leeway for auto fuel subsidies

Electricity suppliers are set to announce their lowest retail prices since the introduction of new pricing rules last August when they announce this coming December’s prices on November 20, barring unexpected market developments over the coming days.

The new rules require electricity suppliers to announce each forthcoming month’s prices by the 20th of the preceding month.

Retail electricity prices in November fell to less than 40 cents per KWh for the category concerning low-voltage consumption of up to 500 KWh per month, a bracket carrying the bulk of consumers. December’s prices are expected to fall even lower, to less than 35 cents per KWh.

This price reduction will not result in any benefits for consumers. But the state, keeping the cost of retail electricity at 15 to 16 cents per KWh, will benefit as it will be able to maintain this desired price level through smaller contributions.

Like in November, no state budget money will be needed for energy subsidies offered by the government, meaning it will have some leeway to subsidize other sectors, most probably auto fuel, once again on the rise.

Electricity subsidies will be entirely covered by windfall earnings of electricity producers injected into the Energy Transition Fund.

Electricity subsidies for December are expected to be trimmed to around 19 to 20 cents per KWh, which, under current conditions, would keep retail electricity prices at 15 to 16 cents per KWh.



Suppliers demand cost consideration ahead of extraordinary tax

Electricity suppliers facing an extraordinary tax of 90 percent on windfall earnings between August and November argue the energy ministry, engineering the tax, should take into account hefty costs they have been prepared to shoulder as a means of subduing retail price levels for consumers.

The energy ministry, currently finalizing a formula for this tax, insists electricity suppliers have benefited from excessive earnings, especially in September and October, implying suppliers overpriced their electricity during this two-month period.

Suppliers, on the other hand, contend they are forced to purchase electricity in advance to protect themselves against fluctuating prices and are engaging in hedging activities as a result of being required, by law, to announce their retail prices for upcoming months by the 20th of each preceding month.

Hedging, as well as other business costs, should be taken into account before the extraordinary tax is imposed, electricity retailers have stressed.

Power suppliers oppose ‘faulty’ tax plan for windfall earnings

Electricity suppliers have reacted against a formula the energy ministry appears to have settled with for an extraordinary 90 percent tax on windfall earnings.

Officials at electricity supply companies, contacted by enegypress, described the formula likely to be adopted by the energy ministry as hastily prepared with shortcomings, especially its dimension concerning the setting, universally, of reasonable price levels to be used to calculate windfall earnings.

A reasonable universal price level cannot be set as electricity supply companies each have unique profiles and different pricing policies, company representatives pointed out.

In any case, there are parameters in the equation that decisively shape the cost of each kilowatt-hour for supply companies, beyond what is objectively derived from the wholesale market.

The most decisive parameter is hedging, which supply companies are obliged to engage in when announcing price lists each month. Vertically integrated companies hedge mainly by locking in gas prices which they pay, regardless of whether prices subsequently fall or rise, while independent suppliers hedge by locking in prices and quantities of electricity from producers or international exchanges.

The energy ministry plans to bring to parliament, by the end of this month, an amendment for windfall earnings benefitting suppliers between last August and the current month.


Extraordinary tax on power supplier windfall earnings

The energy ministry is preparing an amendment for an extraordinary tax of 90 percent on any windfall earnings gained by electricity suppliers since August, which it expects to submit to parliament by the end of November, sources have informed.

This extraordinary tax will be imposed on any windfall earnings made by electricity suppliers between August, 2022 and November, 2022.

Excess earnings will be calculated based on a reasonable monthly electricity supply price to be set for all companies. Earnings exceeding or not reaching resulting levels from month to month will be offset and the net sum will be subject to the 90 percent windfall tax.

This measure comes in addition to a number of other extraordinary tax measures introduced in the energy sector as the government seeks to raise revenues to ensure the continuation of electricity bill subsidies and safeguard state budget resources.

Officials are already moving ahead with another extraordinary tax of 90 percent on windfall earnings of electricity producers between October, 2021 and April, 2022, the aim of this measure being to raise 460 million euros.

Minor retail electricity market share changes in target model era

The domestic introduction, just under two years ago, of the target model, aiming to integrate the wholesale electricity markets of all EU member states, has brought about little change in the market shares of suppliers.

Power utility PPC’s retail market share has contracted by just over 4 percent, from 66.33 percent in November, 2020, to 62.01 percent in September, 2022, a loss unequally divided between independent suppliers.

In September, 2022, PPC’s retail market share fell to 62.01 percent from 64.41 percent a month earlier, while, during the same period, the collective market share of independent suppliers increased from 35.59 percent to 37.99 percent.

During this one-month period, HERON rose to second place among the independent electricity suppliers with a market share of 6.8 percent, behind Protergia, a member of the Mytilineos group, whose market share rose to 8.65 percent in September from 7.2 percent in August.

Elpedison dropped to third place among the independent suppliers with a 6.54 percent share in September, a marginal rise from 6.49 percent in August.

NRG, which is ranked fourth among the independent suppliers, also experienced a marginal increase in its market share to 4.76 percent from 4.7 percent, as did fifth-placed Aerio Attikis, reaching 2.34 percent from 2.13 percent.

Debate, amid the energy crisis, is still going strong about the rules for consumer switches from one electricity supplier to another. An increased number of consumers are leaving behind unpaid electricity bills when switching suppliers, fresh market data has shown, prompting a supplier association to call for restrictions.

ESPEN wants power supply cuts for consumers on the move

ESPEN, the Greek Energy Suppliers Association, wants power supply cuts for consumers with unpaid power bills even if they have moved to a new supplier, citing serious energy-related debt issues caused by consumers shifts from one supplier to another to avoid settlement of unpaid bills.

According to sources, suppliers have experienced soaring unpaid receivables in recent times, consumers taking advantage of flexible market terms enabling shifts from one supplier to another, even with unpaid bills. Under the current rules, suppliers cannot order supply cuts to consumers with arrears.

More than 50 percent of unpaid receivables concerns customers who have switched electricity suppliers, according to market estimates.

Working groups to seek solutions for electricity bill payment evasion

Working groups formed by the energy ministry and RAE, the Regulatory Authority for Energy, to discuss measures aiming to prevent electricity consumers from switching suppliers, leaving behind unpaid power bills in the process, and also to stop consumers from exploiting a universal electricity supply service, covering the needs of black-listed consumers reported by suppliers for electricity-bill payment failures, will be discussed at a teleconference today.

A decision leading to the formation of these working groups to resolve the two issues was reached in late September at a meeting involving the energy ministry, RAE, and all the country’s electricity suppliers.

Recent market data showed an increasing trend in the number of households resorting to the universal electricity supply service.

It is provided by the country’s five biggest electricity suppliers, in terms of retail market share, who share the pool of old and new unwanted customers and provide the universal supply service, at a higher tariff.


November electricity prices, out tomorrow, down 15-20%

The country’s electricity suppliers, now finalizing their pricing policies for next month, are expected to announce, tomorrow, reduced tariffs for November, down by 15 to 20 percent compared to the current month’s levels, sources have informed.

Based on new law, suppliers are required to announce their electricity prices for the forthcoming month by the 20th of each preceding month.

Supplier tariffs, sources informed, should range between 0.45 to 0.50 euros per MWh, which, if confirmed, will result in a reduction of between 15 and 20 percent, compared to October’s prices.

The government’s level of subsidy support for electricity bills next month has yet to be announced. Given the current de-escalation in electricity prices, the government may choose to only rely on the Energy Transition Fund for next month’s subsidies and not use any budget money for this purpose, sources said.

Market analysts are projecting further electricity price reductions until the end of the year as a result of a drop in TTF natural gas prices. The Dutch index has fallen by 66 percent since an August 26 peak of 349.90 euros per MWh, reaching 116.45 euros per MWh yesterday.

The EU’s overachievement of gas storage levels, now averaging 91 percent of capacity, as well as an abundance of LNG supply to Europe, are key factors that have driven down the TTF.


Consumer supplier switches fall 6.5% in September

Consumer switches from one electricity supplier to another fell by 6.5 percent in September, compared to the same month a year earlier, a slowdown attributed to monthly price fluctuations discouraging moves.

During the first twenty days of August, consumer switches decreased by 20 percent, reaching approximately 37,700 from 31,200 in the equivalent month of 2021. Customer mobility was even higher during the remaining ten days of August, resulting in an overall 30 percent increase of shifts for the month.

Based on new law, electricity retailers are required to announce their prices for the forthcoming month by the 20th of each preceding month.

In September, customer shifts fell by approximately 6,500, year on year, to 93,500 from roughly 100,000 a year earlier.

Strong PPA demand prompts boost to 1,500-MW capacity

The energy ministry plans to boost a current 1,500-MW capacity made available to RES producers for Power Purchase Agreements with electricity suppliers or major-scale consumers as this capacity has been virtually exhausted due to robust demand. The extent of the capacity increase still remains unknown.

The large number of green investments being planned in Greece, along with medium-term electricity cost projections PPAs can offer electricity suppliers, are factors that have boosted demand for PPAs in recent months.

Demand would have been even higher if industrial consumers were not subject to a uniform ceiling on wholesale market compensation for green units.

Power grid operator IPTO is taking preliminary steps towards establishing a new priority list, expected in roughly one month.

Suppliers’ cross-checking debt system within first half of 2023

Electricity suppliers are preparing a collective cross-checking debt system for consumers in an effort to prevent further increases in energy debt created by customers switching suppliers and leaving behind unpaid electricity bills.

These customers with arrears are managing to avoid power supply cuts at their properties despite not having settled energy bills with previous suppliers.

The cross-checking system to be applied in the energy sector will be similar to one adopted by the telecommunications sector. A data base will be created, listing consumers with arrears and their overdue energy-bill amounts.

Electricity suppliers involved in the new system’s development estimate that it is still months away from being completed and launched but believe it will be ready for use within the first half of 2023.

The process to establish this new platform is time-consuming as, besides the IT required, approval is also needed from agencies such as the personal data protection authority.

Some suppliers have reported that up to 40 percent of their unpaid receivables have been created by customers switching from one supplier to another.


October tariffs slightly lower than September levels

Electricity tariff levels for October, to be announced late tonight by electricity retailers, are expected to be lower than September’s levels but still higher than August prices, energypress research has shown.

The anticipated retail electricity reduction has been attributed to a recent reduction in natural gas prices at the Dutch TTF hub.

Most suppliers are expected to set their tariffs for October at levels between 60 and 68 cents per KWh, while prices, by some suppliers, slightly below the level of 60 cents per KWh, have not been ruled out.

Under new market rules, electricity retailers must announce their tariffs for forthcoming months by the 20th of each preceding month.

September’s tariffs ranged between 68 and 80 cents per KWh, well over August’s levels of between 47 and 58 cents per KWh.

The government is seeking to stabilize prices for consumers through a latest subsidy package, whose amounts offered will be inversely related to consumption levels. It will be implemented as of October 1.

According to sources, highest subsidies will be offered to consumers making a low-consumption category, to be set at a maximum of 500 KWh per month. Slightly lower medium-category subsidies will be offered to consumers using between 501 and 1,000 KWh per month, while consumers exceeding 1,000 KWh per month will be offered the smallest level of subsidies, the sources added.

Higher-level energy consumers who succeed to reduce electricity usage by at least 15 percent compared to a year earlier will be transferred to the next-highest subsidy category, the sources informed.

Natural gas subsidies are expected to be universally applied.



October tariffs down, subsidies to reward lower power usage

Supplier electricity tariffs for October, due to be announced tomorrow, will be lower compared to September levels and are seen ranging between 0.599 and 0.680 euros per KWh.

A recently introduced market rule requires suppliers to provide their next month’s prices by the 20th of the preceding month.

Pricing for next month has proven very difficult to calculate as market conditions remain very fluid, TTF index prices changing continuously, market officials noted.

However, Greek market peculiarities, factoring in natural gas prices with some delay, are expected to result in lower retail electricity prices next month, the officials explained.

A day after October’s electricity tariffs are announced, the government plans to release a new subsidy formula, to become effective October 1.

According to sources, three consumption level categories will be established, the subsidies to be offered for each inversely related to electricity usage. For example, consumers with usage placing them in the highest consumption category will receive the lowest subsidies and vice versa.

Also, higher-usage consumers in lower subsidy categories will be elevated to the next highest subsidy category if they can reduce consumption by 15 percent compared to a year earlier.




Retail electricity market pressured by rise in unpaid bills

A rise in the number of overdue electricity bill payments, despite the government’s subsidy support and cash returns, received by consumers through a power pass plan, is increasing the pressure felt by suppliers in the retail electricity market.

According to a study conducted by consumer support group Ekpoizo, 17.6 percent of respondents have faced threats by suppliers for power cuts over the past three months, while 3.1 percent had their electricity cut.

The study showed that 92.3 percent of respondents declared being dissatisfied with the level of cash returns they have received through the government’s power pass plan.

One in two consumers received up to 50 euros through the power pass plan, while just 8.1 percent received a sum of between 301 and 600 euros, according to the Ekpoizo study.

Also, the overwhelming majority of respondents, an 89.9 percent share, want a wholesale price adjustment clause included in electricity bills to be abolished.

A considerable percentage of respondents, 42.7 percent, expressed support for further renewable energy utilization. Just 14.5 percent of respondents considered the government’s electricity subsidies effective.

Consumer switches up 20% in August after end of restrictions

Consumers switching electricity suppliers increased by 20 percent in the first 19 days of August, compared to the equivalent period a year earlier, following electricity market revisions introduced August 1 lifting all restrictions concerning moves from one supplier to another.

These revisions were incorporated into an energy ministry package suspending a wholesale price adjustment clause and requiring all suppliers to announce their respective price levels for the forthcoming month by the 20th of each preceding month.

The number of consumers who chose to switch electricity suppliers in the first 19 days of August rose to approximately 37,700 from 31,200 a year earlier.

Consumer mobility in July was down 11 percent compared to the same month in 2021, falling from 68,700 to approximately 61,000, a slowdown attributed to consumers putting decisions on hold in anticipation of the revisions.





Power suppliers given until August 8 to revise misleading advertising

RAE, the Regulatory Authority for Energy, has given three electricity suppliers until August 8 to revise their commercial policies after they were found to be presenting state electricity subsidies as discounts of their own in advertising campaigns.

Details of the three electricity suppliers, not disclosed, will be posted on the authority’s website on August 9 at 11 am if they miss the deadline to revise their commercial policies and fail to inform RAE of the reasoning behind their changes, RAE has announced.


Electricity suppliers revise tariffs upwards for August

Electricity suppliers have just announced tariff revisions, upwards, for August following the government’s implementation of a five-euro price cap on fixed charges.

These tariffs will apply as of today. Deducting the state’s support, worth 33.7 cents per KWh, the revised tariffs announced by suppliers range between 14.9 and 28 cents per KWh, the majority of suppliers offering tariffs between 23 and 26 cents per KWh.

The government’s decision to impose a price cap on fixed charges – after electricity suppliers opted to increase their fixed charges to keep their tariffs, the competitive aspect of electricity bills, as low as possible – as well as the related legislative revision procedure led to a one-week delay, enabling electricity suppliers who had not made accurate forecasts for August’s international prices to reexamine and reset their levels.

Some suppliers have increased their tariffs for August by 4 to 10 cents, compared to previous levels, set on July 25.

These increases reflect the unrest of suppliers as TTF gas prices continue on an upward trajectory, steadily over 200 euros per MWh. Wholesale electricity prices are now back over 400 euros per MWh, reaching 422.02 euros per MWh today.

Combined-cycle natural gas-fueled power stations will be remunerated at a rate of 422.39 euros per MWh in August, up from 292 euros per MWh in July. Open-cycle natural gas-fueled power stations will be remunerated at a rate of 594.76 euros per MWh in August, up from 408.47 euros per MWh in July. The month-to-month remuneration change for lignite-based production is minimal.



Suppliers to increase tariffs in response to fixed-charge limit

The country’s electricity suppliers are expected to revise upwards their basic tariffs after being subject to a five-euro price cap on fixed charges.

In practical terms, suppliers who, for example, have set a tariff price of 50 cents per KWh and a fixed charge of 20 euros, which will now need to be reduced to 5 euros, will consider increasing their tariffs to 52 cents per KWh in order to offset the loss resulting from the price cap, the latest in a series of energy-crisis measures introduced by the government.

If the country’s electricity suppliers do decide to respond to the latest measure by increasing tariff levels, the government’s price-cap initiative on fixed charges could prove futile.

In the lead-up, electricity suppliers opted to increase their fixed charges to keep their tariffs – the competitive aspect of electricity bills – as low as possible after the government implemented price caps in the wholesale electricity market and abolished wholesale-price adjustment clauses in electricity bills, amongst other measures.

Suppliers are expected to announce their tariffs for next month either today or Monday.

Upper limit to be set for electricity bill fixed charges

The energy ministry is set to implement a measure designed to reduce higher fixed charges announced by electricity suppliers for August.

According to sources, the measure, which is imminent, will forbid suppliers from setting fixed charges that are higher than those included in electricity bills all the way up to July 4, when the government introduced a series of energy-crisis measures.

It implemented price caps for the wholesale electricity market and abolished wholesale-price adjustment clauses in electricity bills, amongst other measures.

In response, electricity suppliers opted to increase their fixed charges as a means of keeping their tariffs – the competitive aspect of electricity bills – as low as possible.

The new measure limiting the level of fixed charges will force suppliers to increase their tariffs, market officials have noted.


Suppliers asked to recheck, substantiate tariffs for August

The country’s electricity suppliers have been ordered, by RAE, the Regulatory Authority for Energy, to provide by midday today, data proving that tariffs they announced for August are cost-effective, entirely legal and do not seek to circumvent the law through trickery.

The country’s electricity suppliers announced their tariff levels for August on Monday. From now on, they will be required to announce, on a monthly basis, their prices for the next month by the 20th day of the preceding month.

The latest RAE request may require some of electricity suppliers to recalculate their charges and tiered tariffs.

RAE, in a letter, has asked the country’s suppliers to substantiate the tariff levels they announced on Monday with detailed data.



Power prices for August set at near 50 cents/KWh, over 1 billion Euros in subsidies to cover 90% of the rise

(upd: 12:00) PPC announced its new electricity bill at 0.486 euros/MWh, while other suppliers set their own bills higher.

The minister, Kostas Skrekas, announced that subsidies for energy consumers are going to reach 1.13 billion Euros in August. The goal is to cover up to 90% of the price increase for households, through subsidizing the price with 337 euros/MWh.

Earlier, energypress wrote: 

The country’s electricity suppliers are expected to announce today their respective electricity prices for August, power utility PPC’s price level expected to be slightly below 50 cents per KWh and those of all other players slightly above this level, which, in some cases, could exceed 60 cents per KWh, sources have informed.

Suppliers are expected to post their price levels for August on their company websites from 11am onwards. Suppliers had initially been given a 9am deadline but were then offered a two-hour extension to establish greater clarity on the day’s gas prices at the Dutch TTF index.

The level of the government’s electricity subsidies, expected to be announced imminently, is a crucial factor as it will determine the eventual prices to be paid by consumers.

The government has announced it intends to offer subsidies that will lower electricity prices for consumers to pre-crisis levels of around 20 cents per KWh, meaning subsidies are likely to be worth approximately 30 cents per KWh.

Based on new market rules, suppliers must announce, on a monthly basis, their prices for the next month by the 20th day of the preceding month.


Power suppliers under enormous strain because of increased liquidity needs and high costs

Power suppliers in Greece have reached a critical point considering their inability to finance their increasing liquidity needs and remain in operation.
The suppliers’ capital needs are increasing rapidly along with power prices, since these companies are obligated to pay cash for the electricy they buy daily in the energy exchange.
Given the fact that in August power prices are expected to rise significantly, since the price of gas is passed on one month later in the Greek market, the suppliers’ liquidity needs will also rise considerably.
Furthermore, suppliers are also faced with the following:
Financing for over a month consumer subsidies announced by the government.
The rise of unpaid bills and arrears on behalf of consumers.
Damages from consumers who make use of easy change of supplier.
The obligation to pay their charges to grid operators regardless of having collected it by their consumers.
Suppliers have exhausted their ability to procure new financing from banks, as well as their shareholders’ ability to support them.

August pressure for energy retailers, covering subsidies

Electricity and gas retailers fear even tougher financial times in August as the government’s increasing levels of energy subsidy support offered to consumers to offset rising wholesale energy prices and keep energy bills serviceable will force suppliers to use greater amounts of company capital for the effort, company officials have told energypress.

Energy suppliers need to commit company capital for customer subsidies in accordance with subsidy support packages announced by the energy ministry before they are reimbursed about a month later via the Energy Transition Fund, once DAPEEP, the RES market operator, has cleared related amounts.

The one-month period elapsing from the time suppliers cover subsidies, at their own cost, to their eventual reimbursement is pushing suppliers to their financial limits.

It should be pointed out, energy suppliers have yet to be reimbursed for subsidies they paid for in June, concerning consumption in May.

August electricity prices could reach 50 cents per KWh

Electricity suppliers are set to announce their tariff rates this Sunday, price levels expected to reach as high as 50 cents per KWh, which would demand consumer subsidy support worth over one billion euros for the month to keep electricity bill costs serviceable at a cost of approximately 15 cents per KWh for households and 16 to 17 cents per KWh for businesses, the government’s objectives.

According to some estimates, monthly Energy Transition Fund sums needed for the government’s support package could reach closed to 1.5 billion euros.

TTF natural gas contracts for August are at a level of 165 euros per MWh and are not expected to deescalate easily. Energy exchange prices have skyrocketed to levels of between 340 and 370 euros per MWh.

Such price levels are expected to force electricity suppliers to announce retail prices of 50 cents per KWh for August this coming Sunday, exorbitantly high considering June and July levels were at about 35 cents per KWh without subsidies.


Electricity suppliers fear mass customer shifts with new rules

Electricity suppliers fear new market rules, to be launched tomorrow, could prompt a sharp increase in the number of consumers shifting from one supplier to another, and, while doing so, leaving behind unpaid electricity bills.

Under the current framework, between 20,000 and 30,000 customers are switching suppliers every month, but suppliers fear the new rules, suspending a wholesale price adjustment clause included in electricity bills, could greatly increase these shifts by breeding greater consumer insecurity.

Suppliers will now need to try and forecast energy exchange price levels for ensuing two-month periods, which has raised fears of further price rises as a safety measure for loss avoidance.

Consumers are entitled to change electricity supplier once a month, without any penalties, to secure the best deals in the market.

Electricity suppliers who have been abandoned continue to be deprived of the right to request power cuts for former customers who have left behind unsettled electricity bills.