Over €4 billion from EU fund to help Greece's fight against energy poverty

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The European Union's Social Climate Fund is providing more than €4 billion euros for Greece to fight energy poverty.

This Fund is being set up to address the effects of rising energy prices on carbon pricing.

The funds will be used to finance actions that will support the most vulnerable groups and will probably include subsidies for energy upgrades of buildings, the installation of renewable energy sources and the supply of electric vehicles.

These estimates were made on Thursday by sources close to the European Commission, in view of the preparation for the implementation of the new legislation for the reduction of greenhouse gas emissions presented by the Commission in July 2021.

Electricity producers as well as a number of industries (refineries, metallurgy, etc.) are obliged to have carbon dioxide emission rights for the CO2 they emit.

This obligation extends to transport and buildings as of 2025, which means that gasoline, diesel and heating and natural gas will bear the cost of carbon dioxide emitted into the atmosphere during combustion.

The Social Climate Fund will allocate a total of 72.2 billion euros over the period 2025-2032 to support social groups most affected by rising energy costs.

According to the same sources, Greece is included in the top five countries that will absorb significant funds from the Social Fund for Climate, as for the period 2025-2032 they are three times higher than the corresponding ones based on the emissions from buildings and transport.

Meanwhile, Finance Minister Christos Staikouras announced four new measures, with a total cost of 1.1 billion euros, to strengthen households (mainly the middle class and the most vulnerable) and businesses.

If we add to these, the minister said, the measures that are already being discussed in parliament (reduction of ENFIA, subsidy for agricultural fuel, fertilizers, etc.), the cost amounts to 1.7 billion euros.

In particular, the interventions are as follows:

1. The subsidy for electricity is significantly increased, the subsidy for natural gas is continued and companies are also subsidised. The cost for April is 640 million euros.

2. Financial support to 1.4 million vulnerable households before Easter:

- An additional 1.5 installment of child allowance is granted in April
- An allowance of 200 euros is granted to 677,000 low-income pensioners
- An allowance of 200 euros is granted to 35,000 uninsured elderly people
- An allowance of 200 euros is granted to the disabled
- A double installment is granted to the beneficiaries of the guaranteed minimum income.
The total cost amounts to 324 million euros.

3. Fuel subsidy is provided:

- There will be a direct fuel subsidy for three months to individuals and freelancers with a family income of up to 30,000 euros. Sixty litres of fuel per month will be subsidised, at 0.22 euros per litre, while for island areas it will be 0.27 euros per litre. The minister said that the average monthly consumption is 54 litres.
- Diesel is directly subsidised with 0.15 euros per litre.
- In April, a 200-euro allowance will be granted to taxis.
The total cost amounts to 130 million euros.

4. The installments for the payment of the "repayable advances" are increased to 96 from 60. Reductions for the repayment of government loan amounts remain, such as the 15 pct discount on the one-off repayment. According to the minister, the state has provided loans of 8.3 billion euros through "repayable advances" and will collect 3 billion euros.

READ MORE: Finance Minister Staikouras: Greece will repay final IMF loans by March, surplus by 2023.