Electricity price subsidies for companies

In 2018, the prices for CO2 emission certificates increased sharply. A direct effect of this was the rapid increase in electricity prices. Despite promises to the contrary, the government did not prevent this price increase. However, compensatory measures have been proposed for 2019. For some companies, these interventions are to apply beyond that date, but up to a maximum of 2028.

Micro and small enterprises
In the case of micro and small enterprises (MSE) whose electricity costs rose after 30 June 2018 following the conclusion of new or amendments to existing electricity supply contracts, energy supply companies (ESCs) had to reinstate more affordable electricity prices (i.e. those of 30 June 2018) by 13 September 2019.

The prices should be frozen retroactively from 1 January 2019 to 30 June 2019 or 31 December 2019. This depends on whether the respective micro or small enterprise had submitted the legally prescribed self-declaration of MSE status to the ESC in good time.

If the ESC has not yet carried out a settlement with the respective micro or small enterprise or has not even attempted to do so (e.g. by sending a draft addendum), it is advisable to check whether the enterprise has perhaps been wrongly overlooked.

Medium-sized and large enterprises
In the first half of 2019, medium-sized and large enterprises (MLE) made use of the frozen electricity prices under the same conditions as MSEs, but without having to submit a status declaration to the ESC. If the settlement has not yet taken place, it must be checked whether there is perhaps a mistake on the part of the ESC.

In order to be eligible for support in the second half of 2019, MLEs must apply for so-called de minimis aid to offset increased electricity costs. Although the deadline for applications only expires on 30 June 2020, the first applications can already be submitted after the end of the third quarter of 2019.

Energy-intensive sectors or subsectors
A separate support programme has been set up for sectors with high energy consumption. Electricity-intensive companies (including producers of aluminium, steel, paper, chemical fibres and many other industrial sectors) can therefore receive compensation of the national electricity price annually, but no later than 2028. Eligible companies will be compensated for their electricity costs if they submit the complex aid application for the relevant accounting year by 31 March of the following year.

The compensation for the year 2019 coincides with other support measures for this period. Aid under the conditions applicable to MLEs is in principle not available to energy-intensive companies for the second half of 2019. However, they can benefit from the frozen electricity prices like other companies. If they have not waived this right by mid-September 2019, they can only apply for compensation for the 2020 settlement year by 31 March 2021.

Authors: Kinga Słomka & Bartosz Frydel