- Europe is making energy companies pay a tax on their profits.
- The EU was hoping to get more than €140 billion.
- It would be split between the 27 countries that are part of it.
Europe is putting a windfall tax on energy companies so that people and businesses don’t have to pay as much for their energy bills this winter.
The president of the European Commission, Ursula von der Leyen, said that the EU planned to raise more than €140 billion (£121 billion), which would be split among its 27 member countries.
She also asked for a 5% cut in the amount of electricity used during peak hours, even though plans to control the price of natural gas, which is a big import from Russia, were put on hold.
Ms. von der Leyen said, “It is wrong to make record profits and sales while the war is going on and on the backs of our customers.” Since Russia cut back on gas shipments after invading Ukraine, consumers’ energy bills have gone up, and the fee would help them pay for it.
Related: European stocks drop sharply, and retail sales in the UK fall.
After she said that, the price of gas in Europe went up to €208 per megawatt hour (MWh). This was a big drop from the record-breaking €343 paid in August, but it was a 200 percent jump from the year before.
The new Liz Truss government, on the other hand, has decided against a windfall tax and plans to borrow money to pay for the UK’s $150 billion plan to lower energy bills.
In response to worries about possible delays, it promised yesterday to put in place an energy assistance programme for companies that are having trouble.
