In interventions aimed at decompressing the economic pressure that has been created in the agricultural world, due to the increase in production costs, the government staff has recently proceeded.

The coronavirus pandemic, as well as Russia’s invasion of Ukraine, highlighted on the one hand the importance of the primary sector in the country’s food security, but also highlighted the burdens that the country’s farmers have to bear in order to continue producing.

In meeting that took place last Tuesday at Megaros Maximos between the Prime Minister, Kyriakos Mitsotakis and the 15-member committee of the country’s agricultural blocs, two interventions were announced, on issues that concern the primary sector.

The first concerns “cheaper electricity” for the producers and the second the return of the Special Consumption Tax (SCT) on oil used for agricultural work.

About electricity, Mr. Mitsotakis announced a “locking” of the kilowatt-hour price to under 10 minutes for the next two years. The new price concerns consumption from April 1, when farmers usually start working on their fields.

More detail:

  • Rural electricity connection holders belonging to co-operative schemes or practicing contract farming with no arrears will pay 9.3 cents per kilowatt hour
  • Other rural electricity connection holders with no arrears will be charged 9.8 cents per kilowatt hour
  • Those who own rural electricity connections belonging to cooperative schemes or contract farming with arrears will pay 10.5 cents per kilowatt hour
  • Finally, other holders of rural electricity connections with overdue debts will pay 11 cents per kilowatt hour.

Once the biennium is over, for the next eight years farmers will pay for a third of their consumption, an estimated price of 9 cents per kilowatt. As regards the remaining consumption (2/3), the owners of rural electricity connections do not have any commitment and can procure it freely from the market (freely from the same or the other provider). The relevant contracts are firm with the relevant withdrawal clauses.

In addition, those providers who participate in the program will receive terms of connection for the specific renewable energy projects that will support the program as a matter of priority. This program replaces the program of long-term bilateral contracts for cooperative schemes and contract agriculture that was announced by the Ministry of Environment and Energy.

Rural electricity connection holders with overdue debts can settle their debts to electricity suppliers with repayment in a decade and zero interest. The relevant financial costs are borne by the state with funding from the Energy Transition Fund.

The aim of the interventions is to “lighten” production costs in the agricultural world and at the same time give them the possibility to plan the future for their professional obligations, knowing in advance how much they will pay for the electricity they consume.

EFFK in Agrotiko Oil

One of the main demands of farmers across the country in recent years has been the return of the Excise Duty on agricultural oil, which was abolished in 2016 amid memorandums. Last year the government paid around 76 million euros to a total of 297,428 professional farmers through AADE.

For this year, according to what the Prime Minister announced, producers will receive a total of 82 million euros. Of these, 40 million euros will be credited to the accounts of beneficiaries by the end of March, giving them a “breather” ahead of the start of the new growing season.

However, Mr. Mitsotakis underlined that the current government is willing to open a dialogue for a fairer way of returning the EFC from 2025 onwards, with elements of a permanent solution, regarding how the refund amount is distributed, who and when they will receive it.

CAP

High on the farmers’ agenda is the 2023-2027 CAP, calling for immediate changes. The new Common Agricultural Policy, the implementation of which began at the beginning of 2023, has caused serious issues in the primary sector not only in Greece, but also in several European Union countries.

According to what was announced by the Minister of Rural Development and Food, Lefteris Avgenakis, at the end of February, specifically on the 26th, a discussion will be held at the Council of Agriculture Ministers of the EU, at the initiative of the Belgian presidency, on the revision of the CAP. This discussion is supported by the alliance formed by countries of the South participating in EUMED-9, which includes Greece, Cyprus, Croatia, France, Italy, Malta, Portugal, Slovenia and Spain . It is worth noting that this move is separate from the individual amendments that our country had submitted since December 2023.

The remaining measures

The above measures were the last ones announced by the government to the agricultural world, which in combination with what has been announced in the previous period gives the “message” that the government is next to the primary sector and the farmers. A little while ago, it was announced that the debts to the PPC of the Local and General Organizations for Vascular Improvements (TOEB, GOEB), which today reach 87 million euros. In addition, the “Photovoltaics in the field” program had been announced, with a budget of 30 million euros.

It applies exclusively to farmers and will start in the next period. Also immediately increased (from 3MW to 6MW), the “locked” electrical space, available as a priority to farmers per DEDDIE substation (6MW X 225 substations in the country = 1350MW). Finally, the permitted limit for farmers’ photovoltaics is increased (from 10kW to 50kW), with priority access to the “locked” area.