The EU energy crisis charts a clear path for the Irish budget to ease the hardship

Taoiseach Micheál Martin has offered the strongest lead yet that energy companies making huge profits will be hit with a windfall tax to help fund households and businesses to meet rising costs.

r Martin’s comments came after it was revealed the EU is on course to launch massive interventions in the energy market, due to take place before energy ministers in Brussels on Friday. These include a levy on huge profits from power and energy companies and potential caps on gas prices.

The Brussels executive will also increase pressure on all national governments to set tough and realistic energy saving plans for the coming winter. The plans are being discussed amid growing unrest in many EU member states and large national energy subsidies are being developed in many member states.

The prospects of an agreement on the EU measures have increased after Germany, a conservative on energy market intervention, backed the Commission proposal welcomed by other countries.

Dublin and all the other 26 EU governments were asked what actions they will support at Friday’s EU energy ministers’ meeting. Brussels officials last night said signs pointed to a levy on excess electricity profits and demand-reduction measures backed by the Commission last week. But some countries want to go further.

Further moves include price caps on Russian gas and oil. This follows a move by the G7 group of nations, which includes three EU Kingpin members, Germany, France and Italy.

Over the weekend, the G7 decided to set a price limit at which companies can buy Russian oil leaving Moscow with a take-or-leave choice. Some governments argue that the same could be applied to all Russian energy to turn the tables on Putin’s regime and cut funding for his war in Ukraine.

Mr Martin ruled out the prospect of energy rationing this winter and also pledged to do everything in his power to put money in people’s pockets to help cushion the blow from gas and electricity prices.

He also said that school fees will be increased.

The Taoiseach said energy costs for businesses need to be cushioned to protect jobs. “Then we’ll consider the windfall tax, which is complex,” he said.

Finance Minister Paschal Donohoe is working on it and is expected to report to the coalition’s three party leaders tomorrow and later this week. Mr Martin said the EU plans will have a major impact on what policies are implemented in Ireland.

Measures to decouple electricity and gas prices are also being considered in the EU. There are potential disagreements over how such a sensitive intervention should be carried out, and it’s not clear if an agreement is likely.

Some of the heavily coal-dependent former Eastern Bloc governments want the EU to ease greenhouse gas emissions as part of the measures. But there is opposition from the Commission and several capitals, with officials arguing that carbon prices have remained stable at around €80-€90 per tonne this year. The Commission may split the proposals into immediate interventions and longer-term reforms in hopes of easing tensions. The EU energy crisis charts a clear path for the Irish budget to ease the hardship

Fry Electronics Team

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