Lower excise tax on electricity, anti-inflation shield

Lower excise tax on electricity, anti-inflation shield
Lower excise tax on electricity, anti-inflation shield

The amendment to the excise tax act adopted in December 2021 provides that the sale of electricity to households will be exempt from excise duty, amounting to PLN 5 per MWh in 2021. In the case of an average household that consumes 1.8 MWh annually, the reduction in excise duty means the electricity bill is lower by 75 groszy per month.

The excise duty rates for other electricity consumers are also reduced – from PLN 5 to PLN 4.60 per MWh. This does not apply to hard coal mining and coke production, where the excise duty does not change and amounts to PLN 3 per MWh.

Also read: Poles spend so much on energy. Almost most in the EU

Bills will increase anyway

The effects of the anti-inflationary shield, including cuts in the excise tax on electricity, are nevertheless offset by over twenty percent bill increases. We learned about the new electricity rates in mid-December. The price of electricity alone will increase by as much as 37 percent. Ultimately, the total electricity bill will go up by 24%, which for of an average family means an increase of about PLN 20 per month.

Read also in BUSINESS INSIDER

How much exactly? The largest electricity producer, Polska Grupa Energetyczna, has calculated how the anti-inflationary shield will lower this bill. In accordance with the provisions of the shield, households will be exempt from excise duty on energy by the end of May 2022, and the VAT rate on electricity supplies will also be reduced from 23 percent. up to 5 percent by the end of March 2022

Thanks to such protection, PGE clients in the first quarter of 2022 will record an average gross increase in their accounts by approx. PLN 6 per month instead of PLN 21.

– PGE estimates.

PGE also explains that the increase in tariffs is mainly caused by sharp jumps in the prices of CO2 emission allowances. About 70 percent. The energy generated in Poland comes from coal-fired power plants, and it is one of the most emissive fuels in the energy sector. Over the last year, the cost of emission almost tripled from around EUR 30 to nearly EUR 90 per ton. “Consequently, the cost of generating electricity consists largely of the cost of CO2“- acknowledges PGE.

 
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