Panorama – Gas rises on the basis of the war against a new tax on energy companies

Sedigas, who took part in the meeting with the consortium of electric power companies (which represents the interests of Endesa, Iberdrola and EDP), was highly critical of the future tax and also indicated his “concern” about the measure he considers. It generates “legal uncertainty due to its retrospective nature” whose effects are “far from clear”. The Spanish Gas Union also criticizes – European press reports – that the application of the new tax on the sector may lead to conflict with investors and long-term arbitration procedures that may end in a transfer to public finances. “All this – they say from gas employers – without prejudice to the impact of unfair tax competition against third parties on the competitiveness of our sector.

For all this, the association urges the executive branch to “reflect” on the fact that the application of the tax has specific effects on the functioning of companies, their operations, profitability and sustainability in the medium and long term, “that are generating wealth and employment for the country.”

“We need measures to revitalize and protect the economy, not penalize or punish. In this sense, the aggressive rhetoric against energy companies used to announce this new tax is inexplicable and worrisome, which ignores the historical commitment and essential role of these companies to ensure economic well-being The socialite,” complains Sedigas.

On the other hand, the organization asserts that with the available information it is “impossible” to understand the process and effect of the tax imposed by the government.

It is not known – says Sedigas – what he understands [el Ejecutivo] For benefits and for exceptional purposes, what account will be used, what is the taxable basis for this new tax, what type of tax, etc., to arrive at the declared collection figures”, Sedigas notes in relation to the €2,000 million per year the government expects to collect with this tax in each of the years in which it is proposed to be applied.

The association also considers the new tax one of these characteristics to be a “negative” for a sector operating in competition in international markets and where investments and “financial strength” are necessary to ensure security of supply, and even more so in a context such as the current, “maximum uncertainty and volatility” .

In addition, he regrets that the government’s initiative has a “reputational and brand cost to the country” due to the “insecurity and uncertainty” it generates in a context in which Spain is trying to position itself as a gas hub due to the potential for gas-to-gas regasification, with about 25% of the plants of this kind in Europe.

The tax on large energy companies proposed by the executive, it was announced this week, will be applied to a two-year period on benefits registered in 2022 and 2023 and a target of raising €2,000 million each year.

What companies
Sedigas is the Spanish Gas Association, an organization of companies such as Cepsa, Naturgy, Shell and BP, the national subsidiary of the Algerian company Sonatrach, Iberdrola, Enagás or Repsol, which it acquired in the first quarter of 2022 Net profit of 1.392 million euros compared to 648 million euros From the same period in the previous year, that is, it doubled the benefit. Their numbers have also improved, compared to those recorded during the first quarter of 2021, such as Cepsa, Shell, BP or Naturgia, the company formerly known as Gas Natural Fenosa, which increased its net profit in this first quarter by 9%. So did Iberdrola, which just announced “The highest return in the history of the group”, after a year in which it saw its net profit grow eight points and made “record investments of 9,940 million euros in 2021, up 3% from the previous year”. To shareholders, that Iberdrola expects a profit for this year 2022”Between 4000 and 4200 million euros“.

What is gas
Natural gas is a fossil fuel that contributes to climate change During extraction, transportation and during combustion. Moreover: According to the Ministry of Environmental Transformation, “Methane, which is the main component of natural gas [más del 95%]is a stronger cause of global warming effects than carbon dioxide.” Specifically, methane is a gas with a global warming potential 86 times greater than carbon dioxide in the first twenty years of life. Emission of one kilogram of methane is equivalent to emitting 86% of carbon dioxide Carbon dioxide In addition, more and more scientific research shows that methane leak It is not well explained and represents a bigger climate problem than previously thought.

The Intergovernmental Panel on Climate Change defines fugitive emissions as “the intentional or unintentional release of greenhouse gases during the extraction, processing, and delivery of fossil fuels to the point of end use.” Smoke and mirrors report, from Bankwatch networkpublished in January last year, concludes that “the values ​​of fugitive emissions in more than half of the scenarios are around the 3% threshold set by the International Energy Agency, beyond which fossil gas ceases to provide climate benefits compared to coal.” Spain lacks deposits Gas operating today.