Bulgaria, France and the Czech Republic benefit from the energy crisis in the EU
Source：24 Hours
From：Taiwan Trade Center, Sofia
Update Time：2022/11/02
EU measures to deal with the extraordinary energy crisis risk directing billions to some countries, while others will be left almost empty-handed, according to data analyzed by Politico.
EU energy ministers agreed last week to let countries claw back revenue from low-cost power producers and fossil fuel companies and use that money to cushion the blow from sky-high energy prices for consumers and businesses.
But data analyzed by Finnish energy technology company Wärtsilä for POLITICO shows that while France and some countries in central and eastern Europe would collect significant funds by implementing the measure to deal with the emergency energy crisis, other countries — such as Italy — would receive far less.
It all comes down to how countries produce electricity.
The new system allows countries to earn money from electricity generators that do not use natural gas - known as inframaginals. They are making huge windfalls as a result of skyrocketing gas prices — the price of energy is determined by the last input needed to meet demand, and lately that has been expensive natural gas.
This means that the measure, capping all revenues from non-gas power plants above 180 euros per megawatt hour, will raise the most money in countries that rely on coal, nuclear and renewable energy to generate electricity.
This applies, for example, to The Czech Republic and Bulgaria, which use mostly coal and nuclear power, as well as France, which relies heavily on nuclear power. But not for countries that generate most of their electricity using natural gas and therefore don't have many infra-marginal plants.
France could access 7.9 billion euros after the revenue cap is implemented, POLITICO data shows, while Italy will collect a maximum of 4.2 billion euros.
Because of its energy mix, the maximum income that Latvia can collect per capita is less than a fifth of what France could bring in, while Croatia's per capita maximum is about half that of France. Countries that do not rely on natural gas or already have national measures to cap electricity prices will also not collect much money from the new EU measure.
This is the case in places like Poland, Sweden, Spain and Portugal, where electricity prices are currently already close to or below the taxable threshold.
Germany is also likely to collect less money from the EU mechanism after last week announcing a €200 billion plan to cap gas prices - a move that is likely to lower wholesale electricity prices, leaving less revenue for government to save other producers.
The EU previously estimated that €117 billion would come from the policy. But the real number is likely to be lower, given the complexity of countries' energy mixes and existing fixed-rate contracts.
However, it does not take into account the import and export of electricity between countries. It also does not take into account long-term fixed power contracts, where energy companies guarantee electricity prices well in advance, meaning electricity prices stay below the taxable level while gas prices rise.
This means that for some countries the revenue realized is likely to be significantly lower than expected.
For example, much of Slovakia's electricity is produced by nuclear power plants, which guarantee energy in advance at low prices; they have not profited from high market prices and therefore do not make profits above the taxable threshold, according to the government.
Source: https://www.24chasa.bg/biznes/article/12744487