Industries face huge cost hikes

Medium-voltage industries in Greece pay four times as much as last year for electricity and five times as much for natural gas, which according to the president of the Association of Industrial Consumers (EBIKEN), Antonis Kontoleon, has led to increases in the cost of industrial products ranging from 20% to 40%.

“The excessive cost of electricity we pay amounts to 150 million euros per month. This concerns all medium-voltage industries,” said Kontoleon, describing the dire situation domestic industrial companies are facing, as he spoke at an event organized by the Association of Industries in Thessaly and in Central Greece titled “Energy in Greece: The Energy Crisis and the Role of Industry.”

He explained that this is a cost that industry cannot absorb, or pass on to consumers, as that would entail risking the loss of considerable market share, especially abroad. The EBIKEN head linked the problem of high power rates to the structure of the Greek electricity market, which he said lacks competition and the option of signing bilateral contracts that would offset risks, as the electricity forward market does not function in practice.

As regards natural gas, Kontoleon called on the Energy Ministry to intervene so that industry can obtain cheap supplies from the Trans Adriatic Pipeline (TAP).

Nick Keramidas, EU & Regulatory Affairs director at the Mytilineos Group, stressed concerns about a general risk of the deindustrialization of Europe due to the high energy rates industries face on the continent. Keramidas also criticized European Union decisions on the environment, arguing they approach the issue in a one-sided fashion without taking into account the dimensions of energy sufficiency, flexibility and supply security, as well as access to affordable prices.

The rise in energy costs is reflected clearly in the increased industrial producer prices that Hellenic Statistical Authority data in October showed: They rose 23.5% on an annual basis, and 3.3% on a monthly basis.

That means more price hikes are on the way for many products, as more and more industries state they can no longer absorb the additional costs that they face.