Gergely Gulyás, Head of the Prime Minister's Office, has announced that the Hungarian government has adopted an economy protection action plan introducing a price cap on electricity in certain economic sectors.
From July 1, the government is introducing a 200 euro/MW price cap on electricity used by facilities in the manufacturing industry, accommodations, warehousing and transport, Gergely Gulyás told a press briefing. Sectors supported had the “greatest impact on the economy’s performance and inflation”, as they are directly or indirectly involved in production. “In exchange, the government expects those companies to increase production capacity and not to raise prices this year,” Gulyás said, adding that the Hungarian Chamber of Commerce and Industry would supervise compliance. He said the measure impacts over 5,000 companies and has a budgetary cost of 40 billion forints (EUR 107m). The measure comes after a year when skyrocketing electricity prices prompted 81% of Hungarian companies to sign fixed-price energy contracts, with an average price of over 250 euros/MW, he said. One-third of them pays costs exceeding 320 euros/MW, he said. Skyrocketing electricity prices as a result of the war in Ukraine have been weakening Hungary’s economy, Gulyás said.