EAC firm in face of late bill interest protest

By Angelos Anastasiou
DESPITE public outcry and dissent from its employee unions, the electricity company (EAC) said on Wednesday it was standing fully behind its decision to impose an annual 4.5 per cent interest rate on late bill payments as of September.
Speaking on state radio, Othonas Theodoulou argued that the EAC’s practice of turning a blind eye to late payments in recent years had created a total unpaid amount of €60 million, a figure that would likely grow fast if left unchecked.
“If we had not discouraged this practice, it would be very easy for €60 million to become €120 million, then €180 million and so on,” he said. “You realise that in an organisation with annual revenues of €1 billion this would create an unprecedented liquidity crisis.”
The EAC boss was referring to a figure cited by the semi-state organisation’s spokesman Costas Gavrielides on Tuesday.
“The situation with regard to bills payable to the EAC is unsatisfactory, as they total €60 million, which is causing huge problems for the organisation,” he said.
The electricity company last week announced that it would be imposing a 4.5 per cent annual interest rate on late bill payments, but this would not include vulnerable groups of the public.
This prompted a dissenting statement from its employee unions and widespread public criticism, but the organisation’s management was not discouraged and defended the decision.
“The EAC is not a robust organisation,” Theodoulou said. “It owes a lot of money itself, and it has to pay interest on it. So, in order to keep it from getting worse current consumption must be paid on time.”
He explained that while the EAC’s cost of operating capital is 8 per cent, its board decided to pass on slightly more than half of the cost to consumers, while excluding vulnerable groups.
“This is money we should have received but haven’t – but the EAC owes this money elsewhere at a cost of 8 per cent,” he said. “EAC bills include charges for value-added tax, renewable energy sources, and others. But the EAC pays taxes regardless of late bill payments – the VAT, for example, demands and is paid what it is due on time. This amount is part of the €60 million the EAC is owed.”

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