Gas Prices Capped From 1 September

By , 22 Jul 2022, 11:06 AM Business
Gas Prices Capped From 1 September CC-by-0

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STA, 21 July 2022 - The government decided on Thursday to cap as of 1 September gas prices for households, small companies and basic social service providers. Excise duty remains halved, while VAT will be reduced from 22% to 9.5%. The government also tasked the country's main gas supplier to draft an action plan for complete suspension of Russian gas in three years.

The prices of gas for households will be capped at EUR 0.07300 per kW7/h excluding VAT, while the cap for small commercial users and social services providers will be set at EUR 0.07900 per kW/h excluding VAT.

The cap will be in place for a year, Infrastructure Minister Bojan Kumer told the press after the government session.

He explained that basic social service providers include hospitals, student dorms, retirement homes and prisons, while the small commercial users are defined as companies whose annual consumption does not exceed 100,000 kW/h.

Per year, average households buying gas from cheap providers will save about 10% or EUR 90-130, while those buying from expensive providers will see their annual bill decrease between EUR 170-675 or by between 13% and 37%, Kumer said, adding that additional energy aid payments would also be introduced for the poor.

Average social services providers buying gas from cheap suppliers will reduce their annual bill by up to EUR 1,390 or 11%. Those buying from suppliers with moderate prices will save up to EUR 8,710 a year or 44%, while those buying from the most expensive suppliers will save up to EUR 13,590 a year or 55%.

Small businesses buying from cheap suppliers will save EUR 205-313 a year or 10%, while those buying from expensive suppliers will save EUR 350-1,420 or between 11% and 34%.

As was the case with electricity, the government decided to extend the 50% reduction of gas excise duty. Moreover, the VAT reduction from 22% to 9.5% will not apply only to gas but also to electricity, Kumer said.

He added that the changes would be codified in emergency legislation that is to be drafted during the summer. Prime Minister Robert Golob said yesterday that this legislation would be presented to political party leaders at the end of August.

Kumer also said today that measures for big businesses would be drafted in the second half of August or the first half of September. These measures will be even more targetted than the ones presented so far, he said, adding the measures would be very specific, written "almost for individual cases".

"We will continue adopting measures so that all needed mechanisms will be in place in September to allow households and companies to worry less during autumn and winter," said Kumer.

The minister also said the government had tasked Plinovodi, Slovenia's main gas supplier, to draft an action plan together with gas import companies and the Infrastructure Ministry for complete suspension of Russian gas in the next three years.

The move comes after European Commission President Ursula von der Leyen advised member state to reduce gas consumption by 15%.

The Energy Chamber commented on the Commission's appeal earlier today, saying the reduction was a responsibility of everybody. It also called for measures that would support a shift to greater dependence on electricity.

The chamber also said that a suspension of Russian gas supply would likely be harder for Slovenia than for countries of western Europe, with the business sector bearing the brunt of the burden. Last year, households used only 13% of imported gas, the chamber said.

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