Air conditioners now seem a luxury of the past as the surcharge on water and electricity bills was practically doubled to 95 per cent yesterday.
Fans are set to become all the rage as 82 per cent of households start paying higher bills, a predicament that will see families coughing up between €16 and €250 more each time they pay their bill.
Many people may have wiped their brow in relief at the news that, contrary to expectations, the surcharge did not climb to 115 per cent - the government is absorbing 20 per cent of the cost - but the increase will have a huge impact on family budgets.
The Infrastructure Ministry said yesterday that, conscious of the huge pressures the higher surcharge would have on consumers, the government raised its subsidy by 20 per cent from last October to September this year.
The government also wanted to protect vulnerable families, so that those with an energy benefit - about 30,000 households - will not be affected by the surcharge or will pay only a nominal amount.
The capping will remain unchanged for industry and hotels in order to lighten the impact and safeguard those sectors that generated jobs.
In a bid to soften the blow, the ministry pointed out that the previous 50 per cent surcharge had remained unchanged since last August, when the price of crude oil was $70, even though the cost continued to shoot up. In recent days the cost of crude oil hit a record $143 a barrel, leaving the government no option but to revise the surcharge - between last October and last month it forked out €37 million in subsidies.
"The time has come for the surcharge system to be replaced with new tariffs for water and electricity that reflect today's reality," the ministry said. A lot of work has been done on the structure of the new tariff scheme but the details have to be refined and the implications studied further.
Before introducing this radical system of new tariffs, the government wanted to consult the social partners within the Malta Council for Economic and Social Development so the surcharge mechanism will remain in place for the coming months.
The Federation of Industry last night warned of the adverse impact higher utility charges would have on industry.
It complained about the lack of consultation and said industry was already bearing the brunt of additional fuel costs when importing raw materials and exporting finished products, a situation that was making it less competitive than its counterparts on mainland Europe.
It also pointed out that governments had employed little effort in supporting enterprises in energy-efficient measures or in encouraging businesses to invest in alternative sources of energy.