Engineers maintain high tension electrical pylon near the town of Trutnov February 26, 2012. REUTERS/David W Cerny/ File Photo
The Czech lower house of parliament on Friday approved a government plan to cap revenues of power firms as part of efforts to fund measures to ease the burden of soaring prices on households and businesses.
The bill going through parliament estimates the cap will raise 80 billion crowns ($3.4 billion) in 2023 and is in addition to an already approved windfall tax on the profits of energy firms and banks.
Overall, the Czech state expects to raise at least 100 billion crowns next year from the schemes as it aims to cut the fiscal gap to a forecast 4.3% of gross domestic product, from 4.6% this year, and deal with the energy crisis.
The government had approved the revenue cap earlier this month and pushed the plans through the lower house in a fast-track procedure. The upper house Senate and the president must still sign it off.
The centre-right cabinet has rejected criticism its schemes amount to double taxation and go beyond measures agreed at European Union level.
The caps will range from 70 euros per megawatt/hour of electricity from nuclear power plants to 240 euros for power production fuelled by gas from biomass. The state would then take 90% of revenue earned by firms above that cap.
The Czech cap is based on the EU's agreement to cap power producers' revenue at 180 euros per megawatt/hour, which allows member state to alter that figure for various plants, depending on the type of fuel they use.
The cap will also apply to production based on forward contracts sold in the past, addressing the fact that producers like the country's biggest utility CEZ (CEZP.PR) have already pre-sold most of their output for 2023.
($1 = 23.5010 Czech crowns)
