Electricity tax cut laws have been frozen in Congress for months as prices skyrocket

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In recent days, the government has taken significant steps to reduce electricity prices and curb inflation: awaiting a decision by the European Commission on a proposal by Spain and Portugal to limit the price of gas used by combined cycle power plants to 30 euros. The shock plan to mitigate the effects of the war in Ukraine, among other measures, includes tightening control over companies’ so-called fallen profits and significantly reducing invoice taxes.

However, two initiatives that were sent to court long before Russia invaded and that also aimed to reduce electricity bills are at the expense of their approval in Congress, where they were frozen for several months.

The situation on the streets has been aggravated in recent weeks by the mobilization of various sectors, such as transportation, which has caused some problems in supply. Before the Council of Europe, which gave the green light to the so-called “Iberian Exception”, Moncloe recalled that measures had already been taken to mitigate the effects of the increase in the wholesale market, such as the reduction of VAT on electricity. Reduction of electricity tax or suspension of electricity production tax, the cost of which will be from 10 000 to 12 000 million euros per year, according to government estimates.

Monkloa also claims that he contacted these companies through a law that applies to non-CO2 compensation from the electricity market, which he intends to use to deal with what is known as “benefits from heaven”. With this initiative, which has not yet entered into force, the government has predicted a 5% reduction in the bill.

However, this rule, which was passed by the Council of Ministers in August, has been paralyzed in Congress. The deadline for submitting the amendments expired in October and has been awaiting a report from the Ministry of Environmental Transition ever since. The three largest electricity companies got the best results since 2014 after the rise in electricity prices. The Socialist wing of the government decided to introduce it as a bill – and not as a decree in the form of a law whose legal action is immediate, although parliament must approve it within a month – to legally protect itself from possible harassment of companies in court.

In a similar situation is the law establishing the National Electricity System Sustainability Fund, which provides for the gradual removal (within five years) of the value and upload of the oldest renewable energy premium (EUR 7000 million). A set of energy marketers. The result will be that electricity will be reduced, but the fuel and gas that are already rising and forcing the executive to launch a powerful package of state fuel subsidies will increase.

This law was approved in June and four months later the deadline for amendments to the text expired. Is a presentation, which is the procedure for preparing the final project Standby mode.

Sources in the two groups within the government acknowledge that they are waiting for the department headed by Teresa Ribera to send a report on the changes proposed by the other groups to the draft so that they can negotiate on that basis. “The laws will be passed by consensus of the groups that support the executive and the relevant ministry. We have been waiting for some time for them to evaluate the changes,” said one of the sources interviewed. “We are working on both cases to reach an agreement,” was the official response from the PSOE.

The delay in approving these regulations coincides with the need in the case of the Waste Act, which was approved two weeks before the Sustainability Fund legislation. “This one had 750 amendments and we received it in a month,” said a member of the commission at the time the ministry published its report and voted. This norm has already been passed in the Senate and will soon be finally approved in Congress. Socialist sources point out that at first they had the foresight to go quickly with the other two, but as part of their commitments to Brussels, they changed the plan and accelerated the waste.

“We did not have any more news,” said one of the groups, which usually supports the government, which only needs to add two parliamentary groups to the Environmental Transition Commission to implement the laws, as the PSOE and United We Can have. 19 representatives are needed for most of them.

Source: El Diario

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