Government wants to hear EU plans before agreeing on business subsidies

Electricity prices have soared in November and December.
Electricity prices have soared in November and December. Source: Siim Lõvi /ERR

The government coalition wants to understand the European Commission's plans for subsidizing companies' energy costs before it takes any steps, it was agreed on Monday.

Isamaa Chairman Helir-Valdor Seeder told ERR the issue had been discussed by politicians on Monday. The coalition discussed the party's proposals to help struggling businesses but also agreed to look at how other EU countries have acted.

"We did not reach a decision today but next Monday we will discuss it further. The Ministry of Economic Affairs will make additional calculations and analyses, and we will also try to find out what the European Commission is doing. Because the Commission has said it intends to implement measures — possible solutions have even been announced — for example, such as establishing a gas price ceiling or CO2 compensation," he said.

Seeder said the situation will have changed if these decisions are implemented at the EU-level and Estonia will also need to base its response on them.

One of Isamaa's suggestions is to broaden the universal electricity service scheme to companies, not only domestic households, which the party claims would not create additional bureaucracy or increase the need for more government funding.

"It's true, Eesti Energia's profit will be slimmer," Seeder admitted. "But it would be possible for micro-enterprises to implement it quickly according to European rules, for large ones it would take more time."

He said all parties understand businesses are facing challenges and no one believes they do not need any help at all. Decisions are expected to be made when the coalition meets again next week.

"Clarification is needed as soon as possible, but the situation is such that there is no decision from the European Commission today, and even if it it does not come, the Estonian state will have to make some decisions regardless of it," Seeder said.

The European Commission will present proposals on Wednesday for short-term measures this week, which include electricity price caps and consumption restrictions, Politico reported on Friday.


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Editor: Helen Wright

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