The European Commission. According to the draft of the proposal of the community executive that will be discussed and approved tomorrow, Brussels will propose to the Twenty-seven to set a mandatory objective of reducing demand during peak hours.
For this, an average of three to four hours would be selected for each working day during which the demand should be reduced by a percentage still to be determined.
Brussels therefore insists that binding measures must be taken contrary to what the European Union Energy Ministers stated last Friday meeting in the Belgian capital. During the meeting, most countries were in favor of setting voluntary thresholds and even the Energy Commissioner, Kadri Simson, acknowledged that there was reluctance along these lines. However, the executing arm of the EU has pushed ahead with its initial intention while waiting to negotiate with the governments.
Spain asked for flexibility
In the case of Spain, for example, Vice President Teresa Ribera asked for flexibility so that each government could take the measures it considered necessary to reduce consumption. In this sense, the Commission’s draft contemplates that “each government should be free to choose the appropriate measures to meet the demand reduction objectives” and suggests “considering economically efficient measures such as auctions”, which could to include “fiscal incentives or compensation”.
In its proposal, however, Brussels does include one of the conclusions of last Friday’s meeting: there is still no consensus on the application of a cap on gas. For this reason, it focuses on two other measures intended mainly to “channel” the extraordinary benefits that the energy sector has obtained during this crisis.
profit taxes
On the one hand, it proposes to apply the so-called “solidarity contribution” on an “exceptional and temporary” basis that would affect companies in the oil, gas, coal and refinery sectors. The percentage of this contribution is also to be determined but would be based on pre-tax earnings for the fiscal year beginning in 2022 that are higher than pre-tax earnings since 2019.
Lastly, the measure that generated the most consensus and that some countries already apply is a limit to the profits fallen from heaven for companies that generate electricity with cheap sources such as renewables. In this sense, the Commission insists on “avoiding jeopardizing the availability and profitability of existing plants” and also investing in this type of energy source. The amount to which the limit will apply is also to be determined, but old drafts by the Commission contemplated setting it at 200 euros/MWh.
For countries where caps are already applied that limit the profits of these companies, they would be excluded from this measure at the community level. Commissioners are expected to discuss and adopt the legislative proposal tomorrow and it is the President of the European Commission, Ursula Von der Leyen, who will announce the main measures in her State of the Union address next Wednesday before the plenary session of the European Parliament. in Strasbourg.
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