Daily: State opposes EU fossil fuels windfall tax plans

Tanker being loaded with shale oil.
Tanker being loaded with shale oil. Source: Rene Kundla/ERR

The Estonian state opposes a European Commission plan to impose a windfall tax on electricity generators who use fossil fuels and to cap revenues for renewables companies, daily Postimees reports.

The fossil fuel in question in Estonia is shale oil, mined and refined in Ida-viru County. Viru Keemia Grupp (VKG), which is engaged in both these activities, and potentially also Kiviõli Keemiatööstus. would be caught by the tax if implemented, Postimees reports (link in Estonian) , whereas state-owned electricity generator Eesti Energia would likely avoid it, since its proportion of shale oil production is small, in terms of turnover.

Ministry of Economic Affairs and Communications Secretary General Timo Tatar told Postimees that the state does back desires to save energy and managed consumption, however. 

"Restricting consumption during peak hours would bring down prices and would help to rapidly make stock exchange prices cheaper," Tatar said.

Soaring energy prices – in one hour in mid-August electricity was quoted at €4,000 per MWh on the Nord Pool exchange, the highest permissible at the time – have led to far higher profits than usual for many energy firms.

Tatar was reiterating a statement by Minister of Economic Affairs and Communications Riina Sikkut (SDE) last week, who called the EU proposal unreasonable,

Fossil fuel extractors would be asked to return 33 percent (minimum) of taxable surplus profits for the 2022 fiscal year in a "solidarity tax", while renewables generators would have their prices capped at €180 per MWh, under the EU scheme.


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Editor: Andrew Whyte, Mait Ots

Source: Postimees

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