The recent rise in fuel prices at the pump appears to be reasonable and thus no intervention is needed on the part of the government, Energy Minister Giorgos Lakkotrypis told MPs on Tuesday.
Lakkotrypis dismissed a proposal that he issue a decree enforcing a temporary price ceiling.
For their part, ministry officials said that market monitoring data showed the price increases are within justifiable bounds.
They cited a study carried out by the University of Cyprus, which had determined that the rockets-and-feathers effect does not exist in Cyprus.
That finding flew in the face of consumers’ experience, as well as the Audit Office, which has ascertained that the phenomenon does indeed occur.
Lawmakers said they were unconvinced by the study’s findings and would be taking a closer look at it.
Disy MP Andreas Kyprianou said there is an easy way of determining whether fuel companies engage in profiteering.
Companies operating in Cyprus are allowed a designated profit margin in respect to their sales volume.
“If this profit margin was X in 2017 and X+ in 2018, certainly there must be profiteering going on… it’s not that complicated,” Kyprianou said.
House commerce committee chair Angelos Votsis (Diko) decried the low use of automotive LPG (Liquefied Petroleum Gas) as an affordable alternative to motorists.
He said the cost of converting vehicles to burn LPG was still prohibitive – around €800 per vehicle – and urged the government to subsidise part of the cost.
The energy ministry recently denied a proposal made by parliament for reducing VAT and consumption tax on LPG.
Also on Tuesday the House committee revisited the matter of the electricity utility’s Code 08, known as the Domestic Special Tariff for Specific Categories of Vulnerable Customers.
MPs are complaining that people suffering from certain conditions – such as kidney disease or multiple sclerosis – are ineligible for Code 08.
The government is willing to discuss this, but says eligibility should be governed by income criteria.
Lakkotrypis promised that in a month’s time the government would be issuing a decree relating to this means testing, where households with a combined annual income of no more than €31,000 would be eligible for cheaper electricity.
The lower tariffs for certain categories are subsidised by the remaining consumers.
