On Wednesday, the Lithuanian government backed a proposal to extend the existing natural gas price compensation for households for the second half of the year, but scrapped the state subsidies for electricity.
Without state compensation, the gas tariff for households receiving gas from Ignitis would have gone up by more than 40 percent from July, the Energy Ministry said. The compensation would amount to 63 cents per cubic metre, instead of the existing 99 cents, according to a draft government resolution.
"Gas prices will still need additional compensation due to the risks involved," Energy Minister Dainius Kreivys told the cabinet meeting on Wednesday.
The compensation would be in place until the end of the year and is estimated to require 54.48 million euros from unused state borrowings in the first half of the year. This was also approved by the government on Wednesday.
The energy market regulator is expected to approve the new prices on Thursday.
Under the proposal, the existing electricity compensation would be scrapped. The state now covers up to 28.5 cents per kWh for everything above 28 cents.
Data provided to BNS by the Finance Ministry showed that 232.4 million euros were paid in state compensation to households for electricity and gas between January and May, while businesses received 5.07 million euros.
The government allocated up to 556.8 million euros for electricity and natural gas compensation at the beginning of the year, including up to 382.8 million euros for households (from January to the end of June) and businesses were paid up to 174 million euros from January to the end of March.
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