Filenews 14 July 2022 - by Chrysanthos Manolis
The opposition, led by AKEL, keeps accuracy and unstoppable inflation high on the agenda of criticism, while the government responds that it will not succumb to populism.
EAC, answering questions from "F", informed that the bills sent for July are 22.5% more expensive than the previous ones and 68% higher than those 12 months ago.
The EAC expresses the hope that the reduced oil prices in international markets in recent days may lead to a gradual reduction in the cost of electricity generation, if they continue.
The application of a cap on the selling price of electricity, given that the cap will be below the cost of the EAC, will have a catalytically negative impact on the economic viability of EAC and its ability to continue to act on its mission, with undetermined consequences for the wider economy of the country.
This is the official position of EAC, as expressed after an appeal by "Phileleftheros" by the spokesperson Christina Papadopoulou, regarding the proposal of the Cyprus Consumers Association to put a ceiling on the price of electricity, so that the new increases (just over 22% compared to the previous two months), are not transferred to consumers. Ms. Papadopoulou pointed out that the energy sector is vital for any modern country and EAC is imperative to be able to reliably provide electricity to all citizens uninterruptedly and at satisfactory levels of quality, while satisfying its European commitments for green energy.
The spokesperson of EAC assured that the Authority's tariffs are fully controlled by CERA, as well as its reasonable revenues. "With these revenues, the development program of EAC is implemented and the reliability of its network is ensured, which requires continuous investments and continuous operational and operational modernization," she added.
22.5% increase in July
When asked whether the president of the Cyprus Consumers Association, Marios Droussiotis, is right when he says that the electricity we will pay during this period will be 24% more expensive than the previous bill, Christina Papadopoulou said that the bills issued in July are increased by about 22.5%, compared to the previous month. "This significant increase is due both to the increase in the price of oil internationally, as well as to the revision of the basic tariffs of the EAC, as recently approved by CERA. " As "F" had recently written, the increase in tariffs was deemed necessary by CERA, at the request of EAC, as their previous level did not cover for a while the real cost of the Electricity Authority, which increased significantly, for the known reasons. Due to the failure to cover the costs of the previous level of the tariffs, EAC has faced a liquidity problem in recent months and has raised a significant part of its liquid assets.
68% increase compared to last year
The following explanations by Mrs. Papadopoulou are important: "In the last twelve months there has been an increase in the price of fuel of more than 100%, resulting in an increase in the cost of electricity of 68% (the VAT rate last year was 19% - if it had not been reduced by the State, the increase would have been greater). In all EU countries prices have risen to about the same extent. In real numbers, let's explain that a residential customer with a consumption of 800 kwh now pays €295 per two-month period, while last year he paid €175 for the same consumption, that is, he has an increase of €120 per two-month period. As we heard today (yesterday), oil prices have fallen somewhat and we hope that this decline will continue in the coming months, so that prices will gradually return to normal levels."
Opinion
How is EAC different?
The Cyprus Consumers' Association had opposed the imposition of a cap on the price of fuel when the issue was discussed in Parliament. He argued that if a cap is applied, there will be shortages in demand coverage. Perhaps because he estimated that with the cap there would be damages or very low costs, so sales would stop. The Association, on the contrary, asks for a cap on the price charged by the EAC, perhaps because it believes that EAC, as a semi-public organization, will never stop producing electricity, even if it will certainly accumulate losses and stop investing in its infrastructure. But is it so?
