“Many have already received a letter telling them about the increase in the price of electricity. The measures should be implemented somewhere in November’s ballpark.”
Lintilä also criticized the media for exaggerating the risk of electricity supply disruptions next winter and assured that the decision-makers are only working to ensure that the heat and lights stay on in every home.
“It would have to be an extreme emergency for us to curtail power. We’re yet to see a situation like this, although this is admittedly challenging.”
He said that he was hopeful partly because of the planned start-up of the third reactor unit of the Olkiluoto nuclear power plant in December. Power plant operator Teollisuuden Voima (TVO) announced earlier this week that the unit has restarted power generation at 60 percent of full capacity due to the suspension of the trial production phase. the discovery of material detached from the steam baffles in the reheater in May.
The test phase is expected to be completed and regular electricity production to begin in December.
“If Olkiluoto didn’t start up for the winter, we would face huge challenges and the price would rise even more. Olkiluoto 3 produces about 14 percent of our electricity. It is of great importance,” said Lintilä.
Marita Laukkanensenior researcher at VATT’s Economic Research Institute, and Maria Kopsakangas-Savolainenprofessor of economics from the University of Oulu, stated yesterday to the public broadcasting company that the proposed tax reduction is not without problems.
According to them, cutting VAT is not necessarily reflected in consumers’ bills, as electricity companies are not obliged to transfer the cuts completely to consumer prices. The change would also affect all electricity users, not just low-income households, which struggle the most with energy prices.
The latter makes the proposal expensive and ineffective, Laukkanen considered.
“The question is whether it would make more sense to implement a targeted measure that allows us to support consumers who seem to be disproportionately burdened by the price increases,” he stated.
Laukkanen and Kopsakangas-Savolainen pointed out that cutting the tax would send a questionable message in a situation where it would be important to reduce electricity consumption and direct it to times of the day when electricity is not in such high demand. According to calculations made by the Ministry of Finance, the cut would also lead to a drop in tax revenues of 220–300 million euros.
The drop should be compensated somehow, Kopsakangas-Savolainen said. “Will you increase the debt or will you raise taxes elsewhere? Actions always have a price.”
There is also a danger that what was planned as a temporary measure ends up being permanent, added Laukkanen.
“Even if electricity prices were to rise [to their previous levels] and the price increase pressures did not materialize, it may be politically difficult to start raising the VAT on electricity after lowering it,” he explained.
Aleksi Teivainen – HT
Source: The Nordic Page
