Government retroactively widens 2022 energy support compensation period

Charger and extension cord plugged into outlets.
Charger and extension cord plugged into outlets. Source: Aili Vahtla/ERR

Following a proposal from the Minister of Finance, the government has altered an order from February 22, 2022, which had allocated €74.5 million by way of compensation for domestic energy consumers, in the period from January to March of last year.

The amended wording states these funds can be used to compensate energy costs from October to December of the preceding year (ie. 2021) as well.

Finance Minister Annely Akkermann (Reform) says €55 million was spent in the period October-December 2021 to alleviate energy costs, which was partly covered by the compensation money left over from the beginning of the year and partly at the expense of CO2 sales.

"Initially, the government's decision was made for energy price mitigation measures to run until March, but since a balance emerged, it was decided to ease the energy price in the [preceding] fall as well," Akkermann said.

From this balance, €55 million was spent on alleviating all three categories of energy (electricity, natural gas and district heating) from October to December, of which 57 percent was due to the sale of CO2 quotas, plus €23.65 million which derived from the remaining government reserves, the minister said.

A little more than €13 million still remained from 2022's energy price compensation reserve, which will be transferred to this year's balance.

"It will be transferred to the next year as a free balance, but having said that, currently the energy prices have fallen so much that it is not forecast at the moment that such compensation measures will be needed," the finance minister went on.

Energy compensation measures of this kind were first installed in winter 2021-2022, after energy prices had started soaring, from late summer 2021.

Heating season is taken to run from October to March inclusive, hence the support measure payments being retrospectively applied to the last three months of 2021.

The next round of compensation measures was unveiled in September last year, to apply to the heating season about to finish.

As noted by the finance minister, energy prices fell significantly during that time, though winter arrived quite early – in mid-November – and cold and snowy weather remained well into March this year.

The fall in electricity prices has led many consumers to leave a separate scheme, which involved a guaranteed price level. This price is now higher than the NordPool exchange price of electricity, though the universal price service remains in place to 2026.


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Editor: Andrew Whyte, Merili Nael

Source: "Aktuaalne kaamera"

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