The European countries have been lured by United States to
supply more and more lethal arms to Ukraine and forced to stop buying oil and
gas from Russia. Reportedly at present citizens of these countries are facing a
sharp rise in power bills driven by sky-rocketing gas prices.
According to a Reuters report, an effort is being made to
understand what Britain and other European Union member states are doing to
protect the consumers.
Britain
Britain has a price cap on the most widely used household
energy contracts. A new cap applicable from October will be announced on August
26. The forecasting group Cornwall Insight estimates that average British
annual bills for gas and electricity will jump to 3,582 pounds in October and
4,266 pounds in January. Earlier this year, the price cap was 1,277 pounds.
The government is facing growing pressure to provide more
support to households struggling with energy bills. The major fiscal decisions will
be made by the new prime minister. The Conservative Party leadership contest
between Foreign Secretary Liz Truss and former finance minister Rishi Sunak
runs until September 05, 2022.
Truss has said she would apply a temporary moratorium on
environmental and social levies added to consumers' electricity bills.
Sunak has said more support would be needed to help
households through the winter, and he would act as soon as it is confirmed how
much bills would be increasing by.
In May, when Sunak was finance minister, the government set
out a 15 billion pound (US$18.17 billion) support package to help households.
Every household will receive a 400 pound credit to their energy bills from
October.
More than 8 million low-income households in receipt of
state benefits are also being given a further one-off payment of 650 pounds.
Pensioners and disabled people will also received additional help.
Bulgaria
Bulgaria in May approved a 2 billion levs ($1.1 billion)
package aimed at shielding companies and low-income consumers from the surge in
energy and food prices caused by the Ukraine conflict.
The government decided to offer a discount of 0.25 levs per
litre of petrol, diesel and liquefied petroleum gas and methane from July until
the end of the year and scrap excise duties on natural gas, electricity and
methane.
Denmark
In June, Danish lawmakers agreed a cash handout to the
elderly and other measures totaling 3.1 billion Danish crowns ($439 million) to
cushion the impact of soaring inflation and high energy prices. The measures
also included a cut to a levy on power prices. Danish lawmakers have previously
agreed to offer subsidies worth 2 billion Danish crowns ($288 million) to some
419,000 of the households hard hit by rising energy bills.
European
Commission
European Union (EU) countries are largely responsible for
their national energy policies, and EU rules allow them to take emergency
measures to protect consumers from higher costs.
The EU in July asked its member states to reduce gas demand
voluntarily by 15% this winter with the possible introduction of mandatory
cuts.
The bloc also aims at refilling storage to 80% of capacity
by November 01 to provide a buffer for peak demand winter months.
France
France has committed to capping an increase on regulated electricity
costs at 4%. To achieve this government has ordered utility EDF, which is 80%
state owned, to sell cheaper nuclear power to rivals.
New measures announced include helping companies with the
cost of higher gas and power bills - bring the total cost of the government
package to around 26 billion euros ($27 billion) Finance Minister.
French energy regulator CRE said last month it was proposing
a 3.89% increase in regulated electricity sales tariffs (TRVE). The government
has the ability to oppose the regulator's proposed rate hike and set new
tariffs at a lower level or reject them outright.
Germany
German workers and families will receive extra cash, cheaper
petrol and cut-price public transport tickets to help them shoulder soaring
power and heating costs. Workers who pay income tax will receive a one-off
energy price allowance of 300 euros as a supplement to their salaries. In
addition, families will receive a one-time bonus of 100 euros per child, which
doubles for low-income families.
Over the next few years, up to 13 billion euros per year
will be allocated to subsidize renovations to old buildings and installing more
energy-efficient windows, doors and heaters.
However, German households will have to pay almost 500 euros
more a year for gas after a levy was set to help utilities cover the cost of
replacing Russian supplies.
The levy, introduced by Germany in a bid to help Uniper and
other importers cope with soaring prices, will be imposed from October 2022
will remain in place until April 2024.
Greece
Greece has spent about 7 billion euros in power subsidies
and other measures since September last year to help households, businesses and
farmers pay their electricity and gas bills.
Subsidies, which will be incorporated into power bills, will
come in at about 1.136 billion euros in August and absorb up to 90% of the rise
in monthly power bills for households and 80% of the rise for small and
medium-sized firms.
Greece has imposed a cap on payments to power producers to
reflect their real production costs, effectively scrapping a surcharge on
electricity bills, with proceeds earmarked to help it finance power subsidies.
Hungry
Hungary has capped retail fuel prices at 480 forints ($1.23)
per litre since last November, well below current market prices, to shield
households from surging fuel prices. The measure led to such an increase in
demand, which subsequently forced the government to curb eligibility for the
scheme.
The sharp rises in European gas and electricity prices have
also forced Hungary's government to curtail a years-long cap on retail utility
bills, setting the limit of capped prices at national average consumption
levels, with market prices applying above that.
Hungary has also imposed an export ban on fuels to ensure
domestic supply needs and recently loosened logging regulations to meet
increased demand for solid fuels, such as firewood.
Italy
Italy approved in early August a new aid package worth
around 17 billion euros to help shield firms and families from surging energy
costs and rising consumer prices.
The scheme, one of the last major acts by outgoing Prime
Minister Mario Draghi before a national election next month, comes on top of
some 35 billion euros budgeted since January to soften the impact of sky-high
electricity, gas and petrol costs.
The government also intends to extend a 200 euro bonus paid
in July to low and middle-income Italians who did not previously receive it.
A cut in excise duties on fuel at the pump scheduled to
expire on August 21 is set to be extended to September 20.
Italy is also promoting a cap on gas prices at a European
level to help contain price spikes.
The
Netherlands
The Netherlands has cut energy taxes for its 8 million
households.
Norway
Norway has been subsidizing household electricity bills
since December last year and currently covers 80% of the portion of power bills
above a certain rate. This is planned to go up to 90% from September, with the
scheme to remain in place until at least March 2023.
Poland
Poland has announced tax cuts on energy, petrol and basic
food items, as well as cash handouts for households. It has also extended
regulated gas prices for households and institutions like schools and hospitals
until 2027. The government agreed in July on a one-off payment of 3,000 zlotys
to households to help them cover the rising cost of coal. Prime Minister
Mateusz Morawiecki has said the total cost of curbing energy prices in Poland
will amount to around 50 billion zlotys.
Romania
Romania's coalition government has implemented a scheme
capping gas and electricity bills for households and other users up to certain
monthly consumption levels and compensating energy suppliers for the
difference. The scheme is supposed to be in place until end March 2023.
Romanian Prime Minister Nicolae Ciuca has estimated in
February the support scheme will cost around 14.5 billion lei ($3.27 billion),
but analysts now expect it to exceed 10 billion euros.
The leftist Social Democrats, parliament's biggest party and
a part of the governing coalition, supports replacing the cap-and-subsidy
scheme with regulated prices.
Spain
Spain has started to temporarily subsidize fossil fuel
plants' power costs in a bid to bring down high prices in the short term while
keeping a longer-term focus on building renewable capacity. The system is due
to be in place until May 31, 2023. Spain also cut several taxes to reduce
consumer bills.
Spain announced 16 billion euros in direct aid and soft
loans to help companies and households weather sky-high energy prices.
Sweden
Sweden will compensate households worst hit by the surge in
electricity prices, with the government setting aside 6 billion Swedish crowns
($605 million) for the measures.
