New Energy World™
New Energy World™ embraces the whole energy industry as it connects and converges to address the decarbonisation challenge. It covers progress being made across the industry, from the dynamics under way to reduce emissions in oil and gas, through improvements to the efficiency of energy conversion and use, to cutting-edge initiatives in renewable and low-carbon technologies.
New EU tax breaks in response to Russia’s Ukraine invasion
12/10/2022
6 min read
Feature
European governments have approved a slew of energy tax breaks and subsidies to cope with the impact of Russia's invasion of Ukraine, reports energy writer Keith Nuthall.
If proof were needed that the European Union (EU) was genuinely concerned about the boom in energy prices sparked by Russia’s bloody invasion of Ukraine, it is surely a decision made by the EU Council of Ministers on 30 September 2022 to back an EU energy tax law, for implementation on 1 December 2022.
Given that the original proposal was made by the European Commission (EC) on 1 September 2022, that approval is lightning fast for the EU, whose legislative deliberations usually take more than a year. The EU used an emergency procedure under Article 122 of the EU treaties enabling the Energy Council of Ministers to make an urgent decision, without consulting the European Parliament or – as the proposal stresses – energy sector organisations.
This EU regulation will cap revenues from power producers who have benefited from electricity price rises linked to natural gas costs, which have increased sharply since Russia attacked Ukraine in February. This issue has been solidified by Russia’s halt of gas supplies via the Nord Stream 1 pipeline to Germany since 1 September 2022, with gas supplier Gazprom insisting this stoppage is ‘indefinite’.