Are we risking a Christmas with a blackout? After the rise in bills of electricity and gas that will trigger from October 1st, the danger is that the perfect storm that has broken out on energy will lead to power outages in winter. As well as a drop in imports from China, which is already shutting down its factories. The print explains today that the lack of energy has the ability to create a nightmare scenario for the economy, by cutting growth – because production activities are reduced – and by increasing inflation – because prices are soaring. To this we must approach the structural problem of the very rigid last winter which practically ran out of previous stocks. In addition to the climatic misfortune of light winds, which prevented countries like Norway from providing more renewable energy.
A December in the dark?
For this reason, Francesco Guerrero explains today, the only solution is the one proposed by Jeff Currie of Goldman Sachs. “Demand destruction”, “destruction of demand”, or consuming less energy. Easier said that done. Unless we’re in China, where the government simply ordered local authorities to shut down power plants. Meanwhile, in the fourth quarter (October-December) of 2021, the electricity bill will increase by 29.8% per household, while that of gas will grow by 14.4%. And according to a study by the National Consumers Union for a typical family this will mean spending 184 euros more for electricity and 171 euros for gas on an annual basis. A higher overall cost of € 355. With over 3 billion euros allocated from Draghi government a major increase was avoided.
But, explains today the Corriere della Sera, the medium-term scenario is worrying. The resources of the decree cushion the blow for a quarter but will be refinanced in the next. While the fear of commodity price increases and the acceleration of international demand cover a much longer horizon. “The relevance and extraordinary nature of the interventions decided by the government to cope with an unprecedented price situation require – reaffirms Arera – the identification of structural interventions”. Because otherwise in January the Authority, in the absence of further extraordinary interventions, will have to start a process of realigning the revenue from the Asos and Arim components and gas charges “. The specter of new price rises is around the corner.
The risk increases for bread and pasta
There is also around the corner the risk of increases for bread and pasta. Which is directly related to the increase in the cost of raw materials to produce them. In turn linked to the rise in the price of energy. Marco Lavazza, president of Unione Italiana Food, reiterates them today in an interview with Corriere della Sera. «The scarcity of raw materials and their consequent increase in prices, which also affects the supply of energy, could jeopardize the restart. Just to give a few examples, the price of green coffee has increased by 50% since the beginning of the year, the prices of cereals are at their highest in the last 10-15 years, the raw sugar on the world market has grown by 25%, the price of oil per barrel it has grown by 77% since September 2020. These are problems that put companies to the test, discouraging the efforts of many entrepreneurs who come from a year and a half of uncertainty ».
According to Lavazza, the increase in prices is determined by three main elements: the pandemic that blocked the flows, with consequent tensions when we started again, as evidenced by the current shortage of containers; from speculation on raw materials, including food; from climatic problems with unforeseeable crop failures. «The consequences for consumers will depend on the behavior of individual companies and of the supply chain, in which there are many players. We, processors and producers, are willing to sit down at a table with farmers and large retailers to make supply chain decisions with other players. But the tensions on prices are strong, it is plausible that there may be some increases ».
