From the penetration of RES and especially batteries, in order to reduce the wholesale price, to generous energy-saving programs, subsidies for the purchase of new heat pumps and water heaters, together with reductions in electricity bill charges (PSOs), electricity theft, overdue debts and of course competition in tariffs, the overall package for cheaper electricity by 30% over three years activates a huge amount of national and EU resources, over 5 billion euros.
The roadmap for the 30% reduction in electricity bills during the 2027-2029 period, announced by the prime minister at the Thessaloniki International Fair, was specified today by the leadership of the Ministry of Environment and Energy, presenting a mosaic of interventions and actions, some for immediate implementation, but most of them medium-term.
“The measures concern a holistic approach to reducing costs with energy-saving actions, flexibility in consumption, production or storage for own use. The above will be financed with resources of over 5 billion for reducing energy costs, through 3 different Funds. The Social Climate Fund (2.1 billion), the Fund for the islands (2.3 billion) and the amounts for the Escape Clause (600 million)”, as stated during the presentation by the Minister of Environment and Energy, Stavros Papastavrou.
How we will have cheaper electricity
- Increase in RES. In 2026, during periods of high RES penetration, the average wholesale price was 73 euros/Mwh. With additional RES and better international conditions, the average annual price may converge to this level. High prices mainly come from hours without sunshine. With additional batteries, afternoon peaks and the need to burn expensive gas will also be significantly reduced. The increased penetration of RES raised the cost for reserves and system stability. Storage can provide some of the services at lower cost.
- How storage will be strengthened: The target is 1.5 Gigawatts (mid-2027), 3-4 Gigawatts (2028), and 5-7 GW by 2030. We have 200 million from the escape clause for investments in storage. Of these, 50 million for local authorities, and 50 million for self-consumption. Already, 3 tenders have been carried out from the RRF (900 Megawatts), rooftop photovoltaics with storage, etc.
- Interconnection of islands: The cost from thermal units on islands that are not interconnected is 3 times higher than for the mainland. Production from thermal units on the islands reaches 1.2 billion annually. The additional cost burdens the PSO account. The interconnection of the islands is a multi-year undertaking with a cost of about 7 billion. Crete and the Cyclades have already been interconnected, while the Dodecanese and the North Aegean are in the implementation phase. Part of the 7 billion will be absorbed by European funds. 1.1 billion will come from the Islands Decarbonization Fund (2.3 billion total resources). With the interconnections we can also reduce PSO charges.
- Reduction of PSOs: Reduction in the first tier for household consumers up to 400 kilowatt-hours. And for the existing deficit of the ELYKO account, support of 200 million will be provided from the state budget.
- Electricity theft: Electricity theft costs 450 million euros per year (2022-2024) and its continued reduction removes a significant burden from bills.
- Smart meters: By the end of the year, 2/3 of the energy in HEDNO will operate with telemetering. With smart meters, losses are reduced and flexibility is given to users.
- Competition in retail. Another chapter on which the government is betting is the strengthening of competition in tariffs and the gradual shift of consumers to fixed tariffs, with a characteristic example being the new blue product of PPC. Today about 30% of the market is on fixed tariffs.
- New framework for households, businesses. The Social Climate Fund will provide vulnerable groups with 1.7 billion for energy upgrading and replacement of heating systems and water heaters. Increase in the heating allowance for 780,000 beneficiaries.
- The resources from the escape clause. Important actions will be subsidized by the Public Investment Program, such as the purchase of heat pumps and solar water heaters for 100,000 beneficiaries (200 million), as well as a similar program that also includes the purchase of rooftop photovoltaics, targeting 10,000 beneficiaries in Western Macedonia and Megalopolis (50 million).
- Self-consumption: The strengthened new regime for self-consumption will support the relevant projects which today do not exceed the levels of 1 Gigawatt. Possibility of installation for balcony photovoltaics.