New electricity tariff: Today the ministerial decision that will reveal the secret formula

The setting for the new Skylakakis invoice was voted yesterday in Parliament and the way the price of energy will be calculated, so that the tariff is as safe as possible for consumers, is expected to be announced today, with the publication of the ministerial decision of the Minister of Energy.

In particular, the ministerial decision will determine the “magic recipe”, the way of its calculation fluctuation mechanism and of coefficients of the new Special Tariff, the green tariff introduced by the ministry from January 1.

In the new invoice the Final Supply Price will result from the sum of the Basic Supply Price and his Variation Mechanism. But the Variation Mechanism will not be something freely determined by the commercial departments of the supply companies as is the case with other tariffs. It will be determined by ministerial decree and therefore should be applied in the same way by all companies.

The ministerial decision will specify the variable coefficients of the fluctuation mechanism, the time intervals of change of coefficients and her Basic Supply Pricebut also the way they are marked and printed in Consumer Accounts.

It will also refer to matters of notification and information to Consumers, as well as any other technical or procedural matter and necessary detail for the implementation of the relevant regulation that has already been submitted to the Parliament for a vote.

The new Special Electricity Supply Tariff will be announced by the first day of each month of consumption, it may also have a Fixed Supply Charge, equal to a maximum of five (5) euros per month, as well as discounts, as long as these are not linked to the variation of sizes of the wholesale market.

Article 17 was discussed yesterday in Parliament

The regulation for the new tariff was included in article 17 of the Draft Law of the Ministry of Development “Incorporation of Directive (EU) 2021/2101 of the European Parliament and of the Council of November 24, 2021 for the amendment of Directive (EU) 2013/34 regarding on the publication of income tax information by certain enterprises and branches – Update of national legislation on companies’ publicity obligations and other urgent provisions’.

The Minister of Energy Mr. Skylakakis, responding to the criticism he has received that he is making state interventions and causing confusion in the market, noted that the confusion exists among consumers today, because they do not know which supplier is the cheapest “and we will resolve this confusion”, he emphasized.

The proposed new tariff will be without an adjustment clause, and consumers will know its price in advance, on the 1st of the month, so that there are no surprises at the end of the month. But this means that the risk of an increase in the wholesale price during the month is borne by the supplier, and he will have to hedge the risk by adding hedging costs to the price. The new tariff will, however, also have a correction mechanism in the following month, so that a part of the above potential cost goes to the following month and thus reduces the cost of compensation.

The minister emphasized yesterday that there are more than one million benefits, where consumers have not chosen a tariff in PPC and they historically stay in one tariff, not bothering which tariff they will go to.

And as he said, he did not accept the recommendation of RAEEY, which said that those who do not actively choose to go to the tariff closest to what they had and the option for the suppliers to do it. “As well-intentioned as our suppliers are, there is an inherent conflict of interest that we felt we had to avoid, given that from January 1st for those who don’t actively choose, there won’t be a full contract, we won’t have two parties who will agree. We would have …. only the one party that would agree.”

That is why he decided to create an ex ante invoice, i.e. with a price known in advance that will have: Eyes correction system (price that will be entered in the next month), to reduce as much as possible the difference (in its cost) from the ex post invoice (the invoice whose price becomes known at the end of the month and incorporates any increase in the price of the wholesale market) and to reduce the compensation cost they declare the suppliers.

The new tariff, he said, is as close as possible to the cheapest, but in which the consumer knows from the beginning what the price will be next month. And this invoice should have the feature that consumers can now by opening the relevant page of the FSA – and there will be a message on every account and in every message that consumers will receive with the link that will take them to the price comparison, in order to they can easily see it – compare prices and see who is the cheapest last month, next month, the month after etc. and get a picture of who is the cheapest in the market.

What does article 17 say?

As stated in Article 17, for the consumption of electricity from January 1, 2024 to December 31, 2024, the Electricity Suppliers must transfer the Electricity Customers, who were subject to the provisions of Article 138, to the Special Tariff of the 2.

Excluded:

a) Customers who have entered into an electricity supply contract for a fixed pricing product for a certain period of time, which remains in force after the expiry of the measures of article 138 and for as long as the respective fixed pricing contract is valid, as well as

b) Customers who object to being included in the Special Tariff and at the same time declare their will to be included in a different Electricity supply product, in accordance with par. 7, after they have been informed and up to the 31st December 2023.

2. For the application of par. 1, one (1) Special Electricity Supply Tariff is created by the Electricity Suppliers for each category of Low Voltage customers.
3. For the Special Electricity Supply Tariff of par. 2, the Final Supply Price is announced by the first day of each consumption month, and results from the sum of the Basic Supply Price and the Variation Mechanism. The Special Invoice may also include a Fixed Supply Charge, equal to a maximum of five (5) euros per month, as well as discounts, as long as these are not linked to the fluctuation of wholesale market sizes.
4. In the consumption bill related to the Special Invoicing, the Supplier shall uniformly record the Final Supply Price in €/MWh per month of invoicing. The Final Supply Price of the Special Invoice is notified to the Regulatory Authority for Waste, Energy and Water (R.A.A.E.Y.) and is announced in a prominent place on the Supplier’s website by the first day of each consumption month, based on the relevant guidelines of R.A.A.E.Y.. Upon notification of the Final Supply Price to R.A.A.E.Y. the Supplier also includes a file with information on how to verify the price. R.A.A.E.Y. publishes monthly on its website, in the form of a table and by the fifth day of each consumption month, the fixed charges and electricity supply charges notified to it by the suppliers, which are applied to the Special Tariff.
5. The Suppliers shall publish on their website in a conspicuous place and communicate to R.A.E.Y.Y., until December 1, 2023, all the pricing parameters of the methodology of the Special Invoicing that will apply to each category of customers, i.e. the Basic Price Supply and the prices of the coefficients of the Variation Mechanism. The Suppliers inform the Consumers by any suitable means, in accordance with the provisions on individual information of the Electricity Supply Code to Customers (K.P.H.E., B’ 832/29.3.2013), until December 1, 2023, for the contractual and tariff terms of the Electricity supply products that will apply from January 1, 2024.
6. The Suppliers may configure and offer other products, fixed or floating, provided they are properly labeled, in accordance with the decision of par. 10. The inclusion of consumers in the said products is done after showing their objection to their transfer in the respective Special Tariff, by any suitable means, that is through the use of telecommunications network applications, the internet or other appropriate means or letters, in accordance with article 48 of v. 4001/2011 (A’ 179) and the K.P.H.E.. The presentation of an objection also means the submission of an Application for a Supply Contract Offer.

The change of supplier or supply invoice is made at any time and does not entail the right to compensation of the supplier due to the early departure of the Customer, except in the case of termination of a fixed price contract for a certain period.

7. The Suppliers notify R.A.E.Y.Y., publish on their website and inform the Consumers by any appropriate means, according to the provisions on individual information of the K.P.H.E., until December 1, 2024 , for the contractual and tariff conditions of the Electricity supply products after January 1, 2025.
8. During the period of validity hereof, the Universal Service Supplier Invoice is formed on the basis of the Special Invoice, in accordance with the calculation method of par. 6 of article 138. By decision of the Minister of Environment and Energy, a different invoice may be qualified as the Reference Invoice, from this one with the higher supply charge price of the universal service suppliers, if the latter has a deviation of more than twenty percent (20%), from the average of the most expensive, per universal service supplier and per category of customers, other four tariffs in the table hereof. The Reference Tariff that can be qualified by the above decision cannot fall short of the average of the most expensive, per universal service supplier and per customer category, four (4) invoices of the second paragraph.
9. R.A.A.E.Y. monitors the implementation of this, in particular with regard to price formation, transparency, competitive conditions and the appearance of abusive practices. If it finds relevant violations, it applies the procedure of article 36 of Law 4001/2011 and imposes a fine of up to one thousandth (1/1000) of the Supplier’s annual turnover, plus other penalties that may have been imposed on it.
10. . By decision of the Minister of Environment and Energy, the method of calculating the variation mechanism and the coefficients of the Special Tariff, the definitions of the variable coefficients of the variation mechanism, the time intervals for changing the coefficients and the Basic Supply Price, the method of labeling and imprinting may be determined in Consumer Accounts, in particular matters of notification and information to Consumers, as well as any other technical or procedural matter and necessary detail for the implementation of this. With the decision of the first paragraph, the validity period may be modified, i.e. the beginning and end of validity, as well as the announcement and information deadlines for the pricing and contractual conditions herein.

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