A proposed EU-wide revenue cap for electricity producers could end with the exclusion of coal-fired power plants and renewable fuels like biomethane so as not to undermine Russia’s gas options, a document provided to EURACTIV shows.
Last week, the European Commission proposed capping the price of low-cost electricity generators – such as wind, solar and nuclear – to €180 per megawatt-hour (MWh) to support vulnerable consumers living with them. The income had to be used. with rising energy costs.
European Commission President Ursula von der Leyen unveiled this extraordinary measure in her annual State of the Union address last Wednesday (September 14), saying: “These companies are generating revenues that they never expected, from which he hadn’t even dreamed of.”
Brussels estimates that EU countries could rake in €117 billion from the revenue cap while maintaining respectable profit margins for renewable and nuclear energy producers, whose fuel costs remain unchanged amid the current gas crisis.
However, EU countries are now seeking an exception to the proposed measure. It comes from a document drafted by the Czech Republic, which is currently about the six-month EU Council Presidency.
“The revenue cap should apply to technologies with marginal costs below the cap, such as wind, solar, nuclear or hard coal,” says the document, which is the first test to negotiate an agreement on the Commission’s proposal. Effort.
The document states that EU countries must still decide to “maintain or set a certain market revenue cap for the sale of hard coal-fired electricity” whose cost is above the €180/MW limit. .
The specific revenue cap for hard coal “should enable these costs to be covered and a reasonable profit margin to be achieved,” it said. The purpose of the outrage is to “ensure that the high costs of these producers are fully taken into account”.
In order to maintain the incentive to reduce gas consumption, the document also states that the €180/MWh revenue cap should not apply to either demand-response or storage technologies, which would make the electricity system more flexible. and are in direct competition with gas. – Burned out power plants.
Even natural gas substitutes such as biomethane should not fall below the upper limit “so as not to jeopardize the conversion of existing gas-fired power plants,” it continues.
Also excluded are electricity producers whose costs are already limited by measures such as feed-in tariffs and bilateral contracts for difference.
The large number of exceptions proposed by the Czech EU Council Presidency is forcing observers to observe.
“The complexity of the revenue capture mechanisms (Section 2) becomes staggering,” commented Bram Clay of the Regulatory Assistance Project (RAP), an energy and climate NGO.
“Firstly, the number of possible exceptions,” he says, pointing to exceptions for coal and hybrid power plants and other marginal power generators. “Not to mention the work that would be required to separate the revenue from day-forward trading and long-term trading.”
“The question arises whether this justifies the different approach between energy companies and ‘solidarity contributions’ on taxable profits of oil, gas and coal companies,” Claes told EURACTIV.
> You can read the full document below or download it here:
[Bearbeitet von Alice Taylor]
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