Uncertain times for industrial sector’s electricity tariffs

As the abolishment of an electricity tariff discount offered to industry nears, the sector’s enterprises, currently engaged in negotiations for revised respective agreements with PPC, the main power utility, face uncertain futures regarding their energy costs.

Termination of the discount offer, which ensured energy-intensive industrial enterprises satisfactory tariff levels, was imposed as part of last summer’s bailout agreement. The ensuing negotiation process for new tariff agreements between industrialists and PPC is meant to be cost-reflective, factoring in the utility’s actual operating costs, which have been reduced.

Uncertainty as to the results of the tariff negotiations prevails because many industrial enterprises have yet to conclude their talks. At this stage, the content of PPC’s proposals to be presented for approval at its general shareholders meeting on December 7 remain unknown.

To the surprise of many sector officials, PPC’s administration has decided to not only subject the discount’s end to shareholders for approval but the new respective agreements with industrial enterprises as well.

Much concern has been expressed about the inclusion of the latter as officials fear this could generate various complexities and require European Commision intervention, as has been the case with previous industrial sector tariffs. The re-evaluation process of the country’s industrial sector tariffs has developed into a lengthy ordeal, now over six years long.

On another energy-cost front for the industrial sector, the “disruption management” plan, to enable energy cost savings for major-scale industry in exchange for shifting energy usage to off-peak hours whenever required by IPTO, the power grid operator, will certainly provide some relief to industry. However, IPTO has yet to carry out the necessary preparations. Even if a finalized plan is agreed to, some time will be needed to implement the measure.