The state power company (EAC) is set to simplify its tariffs system, with the changes expected to cut prices for most consumers.
A study commissioned by the company has recommended slashing the different rates for consumption to 11 from 30, depending on whether the premises are commercial or residential and the level of use.
In addition, the current staggered rates for consumption will be scrapped, and a flat rate applied irrespective of total consumption over the billing period.
Under the EAC’s current pricing policy, households consuming up to 120 kilowatt hours are charged the lower rate, which goes up for consumption of between 121 to 320 kilowatt hours.
By June 30 the state-run utility must submit details of its new tariffs for the rest of 2017 to the energy regulator; the company will inform the public of the new rates shortly thereafter.
During a discussion of the matter at the House energy committee on Tuesday, it emerged that the EAC has decided to absorb the increased cost for most of the new rates so that they are not passed on to consumers.
The EAC will cover higher rates for users of thermal storage heating units, water pumps, street lighting, large industrial units using high-voltage and medium-voltage and the Vasilikos cement works.
An estimated 21,000 consumers use thermal storage systems. For this group, the increase in the tariff will be 49 per cent, followed by a 13 per cent rise for water pumps, three per cent for street lighting, four per cent for large industrial consumers; and two per cent for Vasilikos.
The EAC will cover the cost from the higher rates for all these categories for the next four years or until the electricity market is opened to competition, whichever comes first.
The funds, some €5.2 million per year, will come from the company’s profits.
EAC spokeswoman Christina Papadopoulou told the Cyprus Mail that, on average, domestic consumers can expect to pay around six per cent less on their bills.
According to a statement by Akel MP Costas Costa, under the coming changes the rates will rise by about 23 per cent for domestic consumers who use up to 500 kilowatt hours over a two-month period.
This, Costa said, concerned mostly pensioners and persons living alone, and he appealed to the EAC to also cover the increased rates for these consumers.
Papadopoulou said this was not an issue. She said that under the new rates the added cost for consumption of up to 500 kilowatt hours is estimated at a mere 40 cents per two-month period, or 5 cents a year.
She added that very few people, even pensioners, consume only 500 kilowatt hours.
“Only, say, a country house that is uninhabited for most of the year and where the fridge is operating, would consume under 500 kilowatt hours,” she said.
Papadopoulou said the new tariffs should appear on bills in September or October.