PPC is in a difficult situation and is implementing a 500 million euro rescuepackage . The effect will be neutral for consumers, as any increase in kilowatt-hours is offset by VAT and ETMEAR reductions. The Board of Directors is expected to take the decisions tomorrow.
As reported by RES-EIA, the recommendation of the new chairman and CEO of the company, George Stassis to the Board of Directors will include:
* Increase in charge per kilowatt-hour (competitive pricing arm) to boost PPC revenue, but fully offset by lower VAT and ETMEAR cuts for consumers. It is noted that PPC will remain the provider with the lowest fixed end of the market.
* Reduce consistency discount from 10% to 5%
* Introduce a CO2 clause for households without a direct impact on PPC accounts.
* Extra 50% discount for mechanically supported people who are beneficiaries of Social Housing Invoice.
How invoices are configured
Therefore, based on the decisions, PPC’s tariffs are as of September 1 as follows:
– For consumption up to 2000 kWh, the new price is EUR 0.11058 per kWh from 0.0946 which is the current charge.
– From 2000 kWh the new price stands at EUR 0.11936 per kWh, against 0.10252 now.
– And for the night stream the new price is 0.07897 euro per kilowatt hour versus 0.0661 today.
Increases are offset by the VAT reduction
The kilowatt hour will increase from 16.4% to 19.4% , but they are fully offset by the fall in VAT and ETMEAR as Minister of Environment and Energy Kostis Hatzidakis has pledged . The reduction of VAT to 6% from 13% has been decided by the previous government and is already in force, while the ETMEAR reduction is expected to be finalized on Friday and will reportedly be set for home consumption at € 17 per megawatt hour, from 22.67 euros now (25% decrease).
– Consistency discount remains but limited to 5% from 10% today. It should be noted that the discount was originally set at 15% and has already been reduced to 10% from 1 April 2019.
– Regarding the CO2 clause, it should be noted that PPC has already partially transferred to the Medium Voltage the burdens arising from its obligation to purchase emission allowances for power plants, in particular the most polluting lignites. Now the same clause is introduced in mild form on Low Voltage tariffs.With the current data on emission allowance prices there will be no burden on this measure on the total amount paid by households that are customers of PPC.
The basis for calculating the clause will be PPC’s current emissions allowance , which for the low voltage is € 15.68 per megawatt hour.
It should be noted that a corresponding clause related to the fluctuation of wholesale electricity prices (“System Limit Price”) is already included in the tariffs of alternative electricity suppliers.
50% discount for people with mechanical support
PPC will also abolish the reductions in CO2 charges for medium voltage (industries and large commercial chains), where the pollutant clause is already in place.
– For people with mechanical support who are beneficiaries of the Social Housing Tariff ( PPC ) , PPC will provide a 50% discount on competing un subsidized electricity costs . As it is known, the State subsidizes the tariffs of the CTO beneficiaries from 0.045 to 0.075 euros per kilowatt hour. PPC will provide a 50% discount on the amount remaining after the subsidy. It is clarified that the measure does not apply to other beneficiaries of CTOs, ie those who are not mechanically supported.
Increases are necessary for the survival of PPC
The company has raised new invoices to avoid serious risks, even for its survival, following the damaging results for 2018 and 2019 so far. According to competent sources, a possible deterioration of the auditor’s (Ernst & Young) warnings on the company’s viability in the report, expected on September 24, would lead to dramatic developments that may even include pay stoppages (for salaries, suppliers, etc.). , suspension of trading of the shares, classification of PPC loans as non-performing, etc., with obviously serious implications for the economy as a whole. The auditor has already stated in the report on the results of 2018 that there is “substantial uncertainty that may raise significant doubts about the Company’s and the Group’s ability to continue operating. ”
The PPC bailout package also includes the performance of the business due to past utilities, public debt repayment, stranglehold on strategic offshore offenders and clipping orders (30,000 clipping orders for strikers). last two months), securitization of overdue debt. The Ministry of the Environment and Energy will also demand from the EU the abolition of lignite and hydroelectric power auctions(“NOME”), which has led to PPC selling below cost to its competitors while also seeking to increase its target for electricity. PPC’s retail market share was set at 50%.
PPC circles have told RES-EIA that pricing decisions are balanced as all sides of the business are called upon to contribute to the salvation : home consumers and professionals by reducing the consistency discount, the carbon dioxide industry, the government by reducing VAT and paying SGIs and PPC competitors, alternative suppliers with the abolition of NOME.
Source – newsit.gr