Energy bill support schemes may reemerge in fall

German Minister of Foreign Affairs Annalena Baerbock met with Prime Minister Kaja Kallas (Reform) at Stenbock House in Tallinn on Thursday. April 21, 2022.
German Minister of Foreign Affairs Annalena Baerbock met with Prime Minister Kaja Kallas (Reform) at Stenbock House in Tallinn on Thursday. April 21, 2022. Source: Ken Mürk/ERR

The government is considering repeating a support scheme for help with energy bills payment from next fall, ETV news show 'Aktuaalne kaamera' (AK) reported Thursday.

However, Prime Minister Kaja Kallas (Reform) says, it is still early to say exactly who would be eligible for aid and what amounts would be offered.

Kallas told AK that: "Unfortunately, cutting excise duties and VAT would not have an effect, I hear from other prime ministers who have done so. /.../ Now, we will probably have to come up with some support mechanisms next autumn, to overcome the energy price [inflation]."

While the prime minister could not elaborate on the exact details of the proposed support, she did state that this would not be a panacea, adding that those who might get into trouble with their energy bills need to start thinking right away how they might manage to make savings.

"Unfortunately, I can't say that the state pays for everything. We just don't have that sort of money, which is why people should think ahead about how to manage their own risks," Kallas added.

This would include ways of making energy savings – from better insulation, to smarter use of electricity and gas – and would apply to business as well as to private citizens, the prime minister added.

The prime minister recently requested economics affairs minister Taavi Aas (Center) provide her with forecasts of electricity and natural gas prices for the coming 12 to 24 months, as well as information on what means of mitigating any price rises might be.

Aas subsequently said that a scenario where support measures similar to those issued last autumn and winter is by no means impossible, adding that while it is very hard to forecast, a significant fall in prices would be a very optimistic prediction.

Electricity and natural gas prices saw a successive round of record-breaking levels almost from the start of fall last year, prompting the government to issue support packages and cut network transmission fees on both energy sources.

The energy inflation was exacerbated by overall high prices, while in the meantime, Russia's invasion of Ukraine has prompted a decoupling from its energy supplies and a search for alternatives, such as LNG.

A recent bill will cut excise on specific types of diesel, though Reform has consistently opposed cutting VAT, from its current figure of 20 percent to, for instance, 9 percent, as proposed by opposition party Isamaa.

Heating season traditionally runs from October to March inclusive; district heating provides warmth to many apartment blocks which do not have their own boiler systems, and is piped in as hot water, which in turn often uses natural gas for the purpose.


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Editor: Andrew Whyte

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