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Electricity price hike to keep RES afloat.

Consumers are looking at a hike in their electricity bills as the government tries to keep the renewable energy fund afloat, it emerged on Tuesday.

According to the chairman of the House energy committee Angelos Votsis there appeared to be an agreement regarding the green tax levied through electricity bills.

The agreement is expected to remain in force until 2019, providing for a contribution by consumers of around e1/40.01 per kWh.

Vulnerable groups would continue to contribute e1/40.005 kWh, the same as everyone else at the moment.

From January 2017 the rest of the population will pay e1/41.07/kWh. The charge will be slightly reduced in 2018 — e1/40.97/kWh -- and a bit more in 2019, e1/40.93/kWh.

The government's contribution to the fund will be e1/43.8m in 2017, e1/45m in 2018, and e1/44.8m in 2019. It is understood that this money comes from the sale of emissions.

The raise was deemed necessary to cover a hole in the RES fund of around e1/414m.

The fund is currently in the red due to reduced electricity consumption and falling fuel prices which led to lower production costs.

The problem lies in the fact that the energy ministry had signed contracts with RES producers -- owners of wind farms and photovoltaic parks -- when the production cost was much higher and did not include a tariff renegotiation clause, thus the government still has to pay the agreed price despite electricity production costs going down since.

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Publication:Cyprus Mail (Cyprus)
Date:Nov 1, 2016
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