UK isolated as EU agrees windfall tax on energy firms

theguardian.com:

EU energy ministers have agreed to levy windfall taxes on energy companies’ profits, and to cut electricity use, but remain at loggerheads over proposals to cap the price of gas.

Meeting in Brussels on Friday, the bloc’s 27 energy ministers signed off on proposals to levy a “solidarity contribution” on fossil fuel producers that have benefited from soaring energy prices.

Revenues of renewable energy and nuclear power companies will be capped in response to the “unexpectedly large financial gains” made in recent months, as a result of their profits being linked to the price of expensive gas and coal, according to an EU statement.

The measures, which together could raise €140bn (£123bn) to help lower consumer bills and fund the switch to green energy across the EU, contrast with the British government’s approach. Liz Truss, the UK prime minister, has ruled out extending the £5bn energy tax introduced by the former chancellor Rishi Sunak.

Unlike the UK, the EU is also moving ahead with plans to reduce demand for energy. Ministers agreed on a voluntary target to cut electricity use by 10% and a mandatory energy savings target of 5% during peak hours. The mandatory peak hours target was deemed necessary to avoid power being simply moved from most to least efficient countries in the EU’s shared electricity market.

The 10% cut in electricity use is meant to be achieved between 1 December and the end of March. A 15% voluntary target for cutting gas consumption over the winter was agreed in July.

The emergency measures were agreed after a 37% decline in gas supplies from Russia to the EU between January and August, following the invasion of Ukraine. The risks to EU energy supply were further exposed this week when four leaks were found