About a month after the electricity price ceiling was extended until the end of 2024, the responsible ministries are considering adjusting the subsidy. To ensure more competition on the electricity market, discussions are currently taking place about the amount of the reference amount, the Ministry of Energy announced on Wednesday. Wifo boss Gabriel Felbermayr considers a rapid halving of financing from 30 to a maximum of 15 cents ideal.
“On the one hand, this should make the electricity price reduction cheaper for the Ministry of Finance, and on the other hand, ensure that there are more incentives for households to switch electricity suppliers if the 15 cents is not enough to supply the electricity. price to bearable levels,” Felbermayr told Ö1. The Wifo boss also pointed to falling electricity prices.
E-Control expects electricity prices to fall if the subsidy is reduced
According to a report in the Ö1 “Mittagsjournal”, the regulatory body E-Control also assumes that a reduction in the subsidy could lead to falling electricity prices. “If the upper limit for financing electricity contracts is now lowered, I expect an effect that will stimulate competition,” said E-Control board member Wolfgang Urbantschitsch. Customers would check their conditions and energy companies would strive to position themselves well in the market.
Subsidy until the end of this year
The first 2,900 kWh of electricity per year will be subsidized for every household until the end of this year. Households only have to pay 10 cents per kWh. However, the subsidy is limited to a maximum of 30 cents. If the electricity price rises above 40 cents, households must also pay amounts above that. The price of electricity has now fallen sharply again, but not yet at pre-crisis levels.
An adjustment to the electricity price brake can only be made in consultation with the Ministry of Finance. This confirmed the discussions with Ö1’s coalition partner. It is still unclear when a decision will be made.
“The electricity cost subsidy mainly protects consumers who have an electricity tariff with a high labor price. Citizens who choose an electricity tariff with a low labor price receive less support from the state,” criticizes Monika Köppl-Turyna, director of the economic research institute EcoAustria, in a press release. The financing also weakens competition between energy suppliers.
Source: Krone
I am Ida Scott, a journalist and content author with a passion for uncovering the truth. I have been writing professionally for Today Times Live since 2020 and specialize in political news. My career began when I was just 17; I had already developed a knack for research and an eye for detail which made me stand out from my peers.
