"Nowhere in the EU except in Greece are the absurd prices at drift formed in the wholesale do not pass entirely to the retail, that is, the tariffs paid by consumers ", emphasizes with his intervention through iEidiseis the former minister and longest-serving mayor of Kozani.
Those who listened carefully to the recent speech of the Prime Minister on the measures for drift rightly wonder if Mr Mitsotakis is flirting with Euroscepticism. For the sake of truth, two characteristic points of the sermon are listed as such.
"Europe is emerging - at least to this day- under the circumstances. And unfortunately its solution is slow…. But I're not going to wait until the slow-moving European ocean changes course. ".
What are the solutions suggested by the Prime Minister and if they exist because the EU is narrowing;
One possibility would be to suspend the target model for as long as needed, so as to put an end to the outrageous wholesale prices that are formed here and there 9 months in the Union.
It is well known that wholesale prices occur daily on the energy exchange of each country and all those who contribute energy, producers and importers, are paid based on the last offer which is the most expensive. The cost explosion of the units that produce electricity with VAT and the inability to meet the needs without these units in practice canceled the operating model of the electricity market. With average cost in their zone 100 euros for most of the production, the wholesale price is moving everywhere in 250-270 euros after reaching up to 400. This is not a day or a short period of time when some producers benefit conjuncturally, this is a reality 9 months with many producers recording high profits 200 billion euros according to estimates by the International Energy Commission and the Commission.
To the question why the EU does not do the obvious, the answer is simple. The target model is the holy grail of the European version in the liberalization of the energy market and therefore its suspension will be the last refuge if all other measures are exhausted..
It is, of course, a common secret that neoliberal energy liberalization in the EU has historically failed as electricity prices in Europe have risen on average more than in the US in recent years., unlike o,what was happening decades before the release of energy.
To date, the conditions are not ripe for a radical overhaul of energy policy in the EU, but obviously the Greek prime minister does not mean any of this as he is a well-known advocate of full liberalization in energy and not only.
In a solution therefore that exists, the problem is not that the EU is late, but that our government does not propose it because it goes beyond it ideologically.
The other solution would be a European pandemic model energy support program. This is the proposal of Mr. Mitsotakis as he told us a month ago in Delphi and he repeated in his speech asking for the activation of funds from the 220 billion euros of Recovery Fund loans that have not yet been mobilized. If it started from 200 energy companies asking for the help of the Recovery Fund, many might agree with it.
Regardless of the source of the money, however, the question remains as to why the EU is not taking a joint initiative to curb outrageous electricity prices..
The answer here is rather simple and everyone knows it and of course Mr. Mitsotakis. Nowhere in the EU but in Greece do unreasonable wholesale prices go entirely to retail, that is, in the tariffs paid by consumers. Most do not pay an adjustment clause because they have long-term fixed price contracts and large consumers, such as industry, usually have bilateral controlled price contracts with producers. In our country both long-term contracts, as bilaterals are infinitesimal hence and we are all faced with the nightmare of the adjustment clause.
It is worth noting here that fixed price contracts are not of indefinite duration and lately the renewals of the expiring ones are done at significantly higher prices.. This means that when things tighten, the solution of the European umbrella will surely come to the table, not because we recommend it, but because then it will concern everyone.
Given this, the real question is whether the solutions proposed by the EU to the Member States are sufficient., at least in the first phase and especially for Greece. The two solutions that have been proposed and can be applied in parallel are on the one hand the taxation of the super profits of the energy companies and on the other hand the ceiling on the retail price of electricity..
The Prime Minister acknowledged for the first time the possibility of super-profits on the eve of the March Summit, when the proposed text of conclusions with a direct reference to the profit tax was already published. The competent Minister of Energy until 28 April stubbornly denied that they exist preparing us for the sequel we all know.
As for the retail price ceiling explicitly mentioned in the EU toolbox by 8 Of March, the government not only ignored it, but he also attacked PASOK-Movement for Change, which has been proposing it for five months. What does this sentence say?;
The retail price of electricity was a year ago at 150 € / Mwh and a ceiling e.g. 10% shapes it in 165 €/Mwh. With the average wholesale price at which energy providers buy moving close to 265 € / Mwh may sound paradoxical to suggest net loss 100 € / Mwh and zero profit for all providers; except that this is not the case.
The six largest providers are also energy producers owning it 92% of electricity supplies in the country. They earn huge sums from the wholesale electricity market and from the fuel trade and can offset most of the damage from the ceiling to the retail. The rest 8% of benefits are shared 15 companies that can be compensated, as provided for in the proposal, for a reasonable period of time. It is clear that the proposal radically overturns the model of misery with benefits and instead of looking for surpluses that WILL be taxed (;) later calls on producers to document any losses. But society and the real economy are immediately relieved of the nightmare of the adjustment clause. In short, the retail ceiling is a simple and transparent proposal, contrary to the measures announced which are labyrinthine and opaque as no one knows in the end who and how much pays. What is certain is that the government, after sweeping the bottom of all the independent accounts that exist in energy (ΕΛΑΠΕ, ΥΚΩ, Pollutants etc.) now in the state budget, that is, it is preparing to support the measures with loans.
The government's defense in the proposal for a ceiling in retail is built with the aggressive question "how much does it cost;». The question is a dilemma as the retail ceiling costs much less in the public coffers than the government maze, while giving much more to the consumer. In any case it costs a lot, but much less than the violent replacement of lignite with natural gas promoted by the government and the prevention of RES that are waiting in vain, three years now, upgrading the network that is not coming. At the house of the hanged…
(Paris Koukoulopoulos is a former minister and MP, the first elected president of KEDKE and the longest-serving mayor of Kozani)
