Minister avoids making fiscally marked diesel pledge

Riina Sikkut.
Riina Sikkut. Source: Ken Mürk/ERR

Business associations are after an amendment that would allow the use of fiscally marked diesel in place of gas in manufacturing and heating. Minister of Economic Affairs and Communications Riina Sikkut (SDE) said that potential effects are being analyzed and weighed against alternatives.

Entrepreneurs wrote in a letter to the government on Monday that the price of natural gas has grown six times in the past year, whereas no one knows what the price will be this winter or whether there will be enough gas available.

"In such a situation, businesses are looking for ways to replace gas with alternative sources of energy. We believe Estonia should take measures to motivate entrepreneurs to replace gas with alternatives, if only temporarily," the undersigned wrote.

One proposed solution is to amend the Fiscal Marking of Liquid Fuel Act to temporarily allow fiscally marked fuel to be used for heating. This would lower the excise duty on diesel used in heating from €0.372 per liter to €0,021 per liter.

The proposal would also allow the use of fiscally marked diesel in stationary engines – this would allow using diesel to replace gas in production processes. The exception could remain in effect until May 1, 2024, or for two heating seasons.

The address has been signed by the Estonian Chamber of Commerce and Industry, Association of Construction Material Producers, Chamber of Agriculture and Commerce, Food Industry Association and the Estonian Oil Association.

Minister Sikkut told ERR that while soaring energy prices are a concern, the coalition agreement prescribes support only for home users.

"It is clear that energy prices, especially looking at the weekly average price recently, are too much for our enterprise. In addition to making efforts to secure enough gas for the winter, we must discuss whether and what kind of support businesses need. The coalition has not agreed on a single measure so far."

Sikkut said that she welcomes the associations' input that will serve as basis for debate.

Asked whether the proposed exceptions will be taken under consideration, the minister said that first, necessary financial volume and effects would need to be weighed. Once the data is in, alternatives can be considered, based on previous years' measures or solutions employed by other states.

Any financial decision would have to be made during state budget and fiscal strategy deliberations.


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Editor: Marcus Turovski

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