Poland sets energy price cap ahead of winter

By Jo Harper

WARSAW (AA) - The Polish government on Tuesday announced a price cap on electricity to protect small businesses, public service entities and households.

The maximum price of electricity for "vulnerable consumers" and micro-, small- and medium-sized enterprises is 785 Polish zloty ($156) per megawatt hour. For households, the price cap is set at 699 Polish zloty per MWh.

"The proposed solutions for the protection of the above-mentioned group of customers assume that regardless of the increase in electricity prices on the wholesale market in 2023, a fixed price for trading in electricity is provided for in settlements with customers," a government statement reads.

The price cap will apply to 90% of electricity consumption from Dec. 1 for 13 months.

The government defines "vulnerable consumers" as public service entities, including health care institutions, schools and universities, and care institutions.

“We want to go as far as possible with our reduced tariff for small- and medium-sized enterprises, and we are talking about this with the EU,” Polish Prime Minister Mateusz Morawiecki said after Tuesday's Cabinet meeting.

The lower house of parliament has already adopted a law freezing electricity prices in 2023 for households at the level of this year, but up to a limit of 2-3 MWh.

Now the government is proposing that households pay 699 Polish zloty for energy consumed over this set limit.

"There has been a war in Ukraine for seven months and we are experiencing it in various sectors of our lives. We are struggling with shortages and very high prices of gas and electricity, and we have been having very heated discussions in the EU for many months and we do not have much help from there. If we do, we ask for permission to implement certain activities, which we then finance,” Morawiecki said.

“We are not clinging to the climate and energy policy, because it has become partially outdated in the face of the war. It must be reinvented, become independent, diversify sources of gas and energy, so that Europe can no longer be the subject of blackmail from Russia,” added Morawiecki.