New Electricity Price Cap Impacts 5,000 Companies in Hungary
- 20 Jun 2023 10:40 AM
- Hungary Matters
The government has adopted an economy protection action plan introducing a price cap on electricity in certain economic sectors, the head of the Prime Minister's Office announced.
From July 1, the government is introducing a 200 euro/MW price cap on electricity used by facilities in the manufacturing industry, accommodations, and warehousing and transport, Gergely Gulyás told a press briefing.
Sectors supported were the ones with the “greatest impact on the economy’s performance and inflation”, as they are directly or indirectly involved in production.
“In exchange, the government expects those companies to increase production capacity and not to raise prices this year,” Gulyás said, adding that the Hungarian Chamber of Commerce and Industry would supervise compliance.
The measure impacts over 5,000 companies and has a budgetary cost of 40 billion forints (EUR 107m), he said.
The measure comes after a year when skyrocketing electricity prices prompted 81% of Hungarian companies to sign fixed-price energy contracts, with an average price over 250 euros/MW, he said.
One third of them pays prices exceeding 320 euros/MW, he said. Skyrocketing electricity prices as a result of the war in Ukraine have been weakening Hungary’s economy, Gulyás said.
XpatLoop Media Partner
LATEST NEWS IN business