The energy crisis caused by ’'s war in Ukraine continues to have an impact on European economies, business and consumers. Europe’'s high energy prices per year in the eurozone %It caused an inflation rate of 8.5’. ItalyCost of living in ’ %It's up 10.9.
These punitive price increases don't just hurt consumers. They also affect energy-hungry companies like the Gruppo Francia factory, which produces mozzarella on the outskirts of Roma’.
Speaking to Euronews’e Massimo Panagia, CEO of Gruppo Francia Latticini, we have 250 employees in two of our factories. “We produce 20 million kilos of cheese in different formats and specifications.”
In 2022, the CEO announced that energy bills were three times higher than in the previous year. Although investments in biogas and solar panels have managed to partially reduce these costs, they remain a heavy burden on companies like him.
Panagia, “In real numbers, this means an extra cost of €1.3-1.4 million, which is unpredictable. As a result, the cost of our products was significantly affected, ” added.
Are AB’'s measures to combat the energy crisis effective?
The volatility and rising prices in the global energy market have prompted the European Commission to introduce measures aimed at alleviating the burden on living-strapped EU households and companies.
The European Commission adopted the State Aid Temporary Crisis Framework in March 2022’ in order to support the EU economy following the Russian ’'s invasion of Ukraine’.
It allows Member States to provide limited assistance to companies affected by war or sanctions, provide liquidity support to businesses, and compensate for the high energy prices in which companies live.
ItalyIn ’, more than 50 billion Euro’ of state aid, including tax credits, has been approved by Brussels.
Massimo Panagia, “Given the energy bill, each company will Can calculate ’, and this ’ could use it as a loan to make up for the tax to be paid to the government in the coming months, ” said. “This mechanism unfortunately did not work well in short-term cash flow.”
This sentiment is also shared by Mauro Savoia, director of the automotive repair shop in Roma’, a family-owned business. He also took advantage of the tax credit after seeing his energy bills double within a year, but said more needs to be done to help small businesses.
Autopozzi Savoia’'s owner and managing director, Mauro Savoia, told “ that there was no financial relief at all. “We expected at least some economic assistance or grants to help companies at the end of the year.”
EuropeAssessing and rethinking ’'s energy system
UkraineThe war in ’ has revealed the need to rethink energy supply, energy consumption and energy production.
Energy expert Simone Tagliapietra, a senior member at the Bruegel think tank in Brussels, ’, said that in recent months, energy prices have been falling sharply across Europe. Families will see lower energy bills in the coming weeks and months. But those energy bills will still be twice, three times higher than what we've seen in the past, ” said.
AB’'s Temporary Crisis FrameworkDespite the benefits that ’ can bring to companies trying to survive among its exorbitant energy bills, some experts have expressed concern that this could lead to market disruption.
Tagliapietra, “In times of crisis, one of the typical reactions of the European’ is to loosen these rules of state aid a little. The problem is that when you loosen and dilute competition policies in Europe’, for example, Germany and France are usually the two largest countries that benefit the most from state aid rules; These would be Germany and France, who would have the financial space, that is, the money to spend on subsidizing their companies more than others.”
“In 2022, we are faced with a situation where 80 percent of state aid is allocated only by Germany and France.’
When asked if these measures were sufficient to help businesses weather the storm Tagliapietra, “There were many interventions, that is, the tax credit was one, but then there was also a reduction in VAT’. Companies have seen their energy bills triple or even quadruple at a given time. But we need to take into account that without government intervention, energy bills would have gone up much more than that.”
The energy crisis has exposed the vulnerabilities in the European electricity market. In January, the EU launched a consultation meeting to reform the market and better protect consumers from price shocks. But Tagliapietra Euronews’e said that alone would not be enough.
We shouldn't think that this will be the solution to our energy crisis problems, ” said. What was our problem with the “Energy crisis? The mismatch between supply and demand for natural gas, namely Russia, after the arming of ’.”
The only way for “ to emerge from this crisis sustainably in the coming months is to correct this imbalance; You can do this with alternatives by reducing your demand and maximizing supply. This means building floating storage and gasification units, as Germany’ does. This means signing new gas agreements with LNG suppliers. To promote solar energy to get rid of gas in electricity generation, to promote the spread of heat pumps in our homes to get rid of gas boiler. They are the only structural solution to the energy crisis in Europe’.
