Due to the energy crisis, Greece is bracing for the most difficult winter since 1942, the darkest year of the German occupation, a minister warned on Saturday.
Minister of Development and Investment Adonis Georgiadis advised Greeks to seek alternative ways for their energy needs and warned of the difficult months to come due to “the enormous damage that our economy and our pockets will suffer from Putin’s energy war in Europe.”
The World Bank has warned that the war in Ukraine will not only drive up energy prices but also food costs for the next three years, resembling the crises of the 1970s.
“There will be an immediate public information campaign on how to act this winter in order to reduce the enormous damage that our economy and our pocket will suffer from the energy war of Putin in Europe,” Georgiadis announced.
“We must keep in mind that we should not spend the electricity in the way we did…in the past,” Georgiadis said. “Electricity is now too expensive.”
Like many other European countries, Greece has been facing an energy crisis. Greeks are among those greatly affected, facing challenges on various fronts, including rising costs for electricity, fuel, and essential commodities.
Subsidies for households and businesses doubled
Georgiadis claimed that Greeks have still not realized how expensive energy has become due to the subsidies offered by the Mitsotakis government.
“What citizens see in their electricity bills is largely paid by the government,” Georgiadis said. “But, we all must now operate with energy savings in mind. There is no doubt that the Greek government will continue to support the citizens.”
In late August, Greece announced the doubling of power subsidies for households and businesses in September, as the price of electricity has skyrocketed.
State subsidies for household electricity bills in September will reach a record 0.639 euros per KWh, amounting to 1.9 billion euros in total.
Subsidies will absorb eighty-nine percent or more of the increase in rates, the government claims.
Athens has spent about eight billion euros in power subsidies and other measures since last September to help households, businesses, and farmers pay their electricity and gas bills.
Energy subsidies could harm the economy in Greece
Economists, however, are warning of the longer-term effects of the subsidies on the Greek economy.
A report in the Financial Mirror says that what has saved the Greek budget thus far has been the higher-than-expected gross domestic product, boosted in part by the record number of tourist arrivals, spending, and inflation.
These factors have made for higher than planned revenue.
But officials caution and fear that these factors cannot make up for the explosive growth of subsidy needs for long.
“There has to be a limit; otherwise, other parts of government expenditure will suffer and will inevitably result in the breakdown of services”, noted Finance Ministry sources.
Hence, finding a golden thread between rising energy prices and subsidies is becoming a nightmarish enigma, the Financial Mirror says.