Twenty-seven agrees to reduce electricity demand by 5% during peak consumption hours

It took less than an hour to approve the new arrangement, which came to the meeting, which almost closed after the proceedings in the last days of the Czech EU presidency, to accommodate the positions of the different Member States and to guarantee the necessary flexibility. in their application. Flexibility to allow European governments to continue to implement measures equivalent to those designed at European level. This means: government Pedro Sanchez Alongside the reduction in the benefits of marginal technologies introduced in September last year, Congress continues to impose the new 1.2% tax on energy companies currently operating.

“We live in exceptional times. The agreement reached this Friday will be a relief for European citizens and companies. He said that “Member States will flatten the electricity demand curve during peak hours, which will have a direct positive impact on prices” and “redistribute excess profits from the energy sector among those who have trouble paying their bills”. Chairman of the Council, Jozef Sikela.

Forced but flexible savings

makes a deal Voluntary global reduction target of 10% of gross consumption electric and a mandatory 5% reduction target during peak hours of the day, which is the most expensive, to reduce gas consumption by the end of March 2023. Member States will have absolute freedom to reduce 10% of their hours. appropriate measures to reduce consumption for both purposes during this period as well as demand. Second, the EU will limit unexpected profits to €180/MWh for electricity producers, including intermediaries using sub-marginal technologies such as renewable or nuclear to generate electricity.

According to Twenty Seven, these operators have made financial unexpected bucks in recent months without rising operating costs. because of the role of coal and gas as marginal resources that set prices and currently inflate the final price of electricity. The cap level, which countries like Spain consider excessively high, is designed to protect operators’ profitability and prevent renewable energy investments from being hampered. The agreement, however, will allow Spain to continue to apply the 67 euro MWh cap it has had since last year.

Energy rate

The third pillar of the regulation, “Mandatory temporary solidarity contribution” about the benefits Companies operating in the crude oil, natural gas, coal and refinery sectors. This tax will be calculated on taxable earnings, determined according to national tax rules in the tax year starting in 2022 and/or 2023, and above a 20% increase in average annual taxable profit since 2018. The solidarity contribution will be applied as a percentage of extraordinary profits in addition to the usual taxes and duties applicable in the 33 Member States. While not exactly the same as the tax designed by the Government of Pedro Sánchez, the regulation ensures that Member States can maintain their national measures if they are equivalent.

Also new standard will allow governments to temporarily set a price for electricity supply to small and medium-sized businessesTo support SMEs and set a below-cost price for exceptional and temporary electricity supply. Under the agreement, Member States will use the proceeds from the solidarity contribution to provide financial support to households and businesses and to mitigate the effects of high retail electricity prices. The measures will enter into force as soon as they are officially adopted and published in the EU Official Journal.