Poland Extends Power Price Cap Through 2025

The cap caps the net price for electricity for household use at 500 zÅ‚/month)MWh (or zÅ‚oty) equivalent to €188. The measure, which was approved at the end of last year, aims to relieve the financial strain of high living costs amid inflation and energy market fluctuations.

“It seems to be preventing what many had feared, an almost unlimited rise in energy prices in the coming year.” Tusk said the EU leader said it meant that “even if the market prices are lowering, it may not conclude for consumers in severe price hikes next year.

Reaction to a War's Provocation Cast in Energy Crisis
Introduced in late 2022 by the former conservative government at a time when energy prices soared dramatically after Russia invaded Ukraine, the freeze was not expected to be repeated. The current cap was agreed in November 2023 at a cost to the Polish government of around €1-3 billion.

His government proposed capping the cost of energy from renewable sources at an established rate of 610 zÅ‚oty (€143.43) per MWh for the next two decades; at the auction or tendering, the state makes up the difference between this consumer‚Äôs rate and the market rate (which is just south of 623 zÅ‚oty [€146.50] per MWh), which is paid to electricity dealers.

Almost 16.4 million Poles receive electricity at home, over 10 million of them applying for the capped rate under the government’s scheme, the Office of the Energy Regulatory said.

The government hopes to cushion consumers from the impact of any future economic shocks while energy markets continue to settle.