The association said some governments are going beyond the flexibility already allowed in the rules for the recently introduced EU-wide revenue cap on inframarginal electricity producers, including wind.
The cap is set at €180/MWh, and governments will recover the difference between that cap and the market price to support households and companies to reduce their energy bills during the current crisis. But governments are allowed to deviate from the €180/MWh rate and set different caps for different technologies.
"That wasn’t very helpful," according to WindEurope, which said it creates uncertainty for investors. The situation is "getting worse", it said, with some governments "doing things the rules don’t allow", reducing investor confidence further.
The trade body singled out Romania, Spain and Poland for particular criticism. It said some governments were ignoring the fact that revenue caps can only apply to actual realised revenues, while others were introducing new taxes on top of the revenue caps.
Romania has introduced a tax on the revenues of electricity generators that "ignores the fact that those who’ve hedged their revenues are not earning the wholesale electricity price", WindEurope noted. Most wind farm operators in Romania have hedged their power sales in long-term contracts to protect themselves from price fluctuations. This means their revenues are fixed and they are not benefiting from spikes in electricity prices. "But the tax ignores that. It’s taxing non-existent revenue and penalising the most prudent asset owners," the trade association said.
WindEurope also criticised Spain for expanding its “solidarity levy” on fossil fuel producers to electricity producers, irrespective of how clean their electricity is. It said: "It’s a tax on income, not profits. So renewables producers whose revenues are capped are also hit by a tax that should’ve applied to fossil fuels only."
Meantime, Poland has extended the application of the cap "way beyond the end date in the EU law, creating an unequal situation with other Member States".
These unilateral measures are causing big renewables investors to think twice about investing in Europe, WindEurope warned, while the number of new wind turbines ordered so far this year is down on previous years and "well below the levels needed for Europe to meet its new energy targets".
This is the exact opposite of what Europe needs, it said. "These misguided and often illegal interventions mean we’re going to get less investments in renewables. It’s totally wrong and has to stop."
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