the government is reviewing its copy

The government this weekend announced increased end-of-year support for energy-intensive workers without waiting for the enhanced system envisaged in the 2023 Finance Bill (PLF) to come into force. Updates for September/October 2022 will be as follows:

• the aid ceilings will be raised to 4 million euros, 50 million euros and 150 million euros (compared to 2 million euros, 25 million euros and 50 million euros), aid limited to 150 million euros will be directed to “sectors exposed to the risk of carbon leakage”;
• during the period of application of the aid, the energy price should have increased by +50% compared to the average price paid in 2021 (compared to the average price paid in 2021);
• the calculation of aid amounts will be revised;
• negative or declining gas and electricity gross operating surplus (EBITDA) criteria will be removed for aid limited to EUR 4 million;
• The number of supporting documents required to receive aid, limited to 4 million euros, will be reduced;
• the alternative criterion of a 40% decrease in gas and electricity EBITDA over the period will be applied for aid limited to 50 and 150 million euros;
• An alternative criterion requiring energy costs in the first half of 2022 representing more than 6% of the turnover (turnover) in the first half of 2022 will be applied for aid limited to between 50 and 150 million euros.

At the time of writing, the executive order outlining these measures has not yet been published in the Official Journal. These new features should also apply to the November/December 2023 compliance period. The government says the window will be open on November 19 (aid capped at 4 million euros), “at the end of November” (aid capped at 50 and 150 million euros). “Early 2023” for September/October 2022 and “Early 2023” for November/December 2022.

The aid is limited to 4 million euros

This aid, capped at €4 million instead of €2 million, will now only be open to “all companies” that justify:

• during the period of application of the aid (e.g. September and/or October 2022) the energy price increased by 50% compared to the average price paid in 2021 (compared to twice the average price paid in 2021);
• during the period of application of the aid, energy costs make up more than 3% of the 2021 turnover.

Hence, the criterion that eligible companies must substantiate negative or declining gas and electricity EBITDA during the eligible period has been removed. The application file will be simplified. Eligible companies only need to provide the following:

• Energy bills for September and/or October 2022 and payments for 2021;
• their bank details (RIB);
• aid calculation file (available on the tax website);
• a sworn statement confirming that the company has fulfilled the announced conditions and the accuracy of the information.

The aid will cover 50% of the difference between the 2021 bill and 50% of the 2022 bill, up to 70% of 2021 consumption.

Also read “Gas and electricity” assistance has been extended and simplified

Aid was limited to 50 and 150 million euros

Aid, which is limited to 25 and 50 million euros, will also be increased to 50 and 150 million euros. Aid, capped at €150 million, is intended for companies in “sectors at risk of carbon leakage”. This assistance will now be open to energy intensive companies:

• during the period of application of the aid (e.g. September and/or October 2022) the energy price increased by 50% compared to the average price paid in 2021 (compared to twice the average price paid in 2021);
• 2021 energy costs greater than 3% of 2021 revenue or 1H 2022 energy costs greater than 6% of 2022 revenue (innovation) ;
• gas and electricity EBITDA was negative or decreased by 40% during the period (innovation).

Until now, eligible companies had to justify 2021 energy costs of more than 3% of 2021 turnover without any other alternative. And EBITDA for the period had to be negative without any other alternative.

Amount of assistance

Now the amount of assistance will correspond to:

• 65% of the difference between the 2021 bill and the 2022 bill increased by 50% within the limit of 70% of 2021 consumption for aid limited to €50 million;
• 80% of the difference between the 2021 bill and the 2022 bill increased by 50% within the limit of 70% of 2021 consumption for aid capped at €150 million.

The amount of aid so far has been:

• or 50% of the total eligible value of the eligible period, calculated as 80% of the mathematical reciprocal of the amount of gas and electricity EBITDA for aid limited to EUR 25 million;
• or 70% of the total eligible cost of the eligible period, calculated as the mathematical equivalent of 80% of the gross operating profit for gas and electricity for the eligible period for which the aid is limited to EUR 50 million.

Also read Energy conservation plan: the basics to remember

Matthew Barry