Romanian Govt. doubts five-month windfall tax discourages long-term investors

Romanian minister of energy Virgil Popescu said that he doubts that the windfall revenue tax levied to energy producers for a limited period of time (until March) could have a major impact on the volume of long-term investments as representatives of Italian utility group Enel implied recently.

Enel said that it had planned to invest EUR 2 bln in Romania but is now reconsidering its plans after the Government decided to cap energy prices and levy a windfall revenue tax, including in the segment of renewable energy generation.

"I do not believe that legislation that applies for five months has any effect on investments until 2027, I prefer not to comment on that statement made by the Enel president. We are talking about transitional, five-month measures being taken across Europe," minister Popescu stated, according to Economica.net.

"We believe that the measures imposed by the authorities in Romania are incorrect, discourage investors, create instability, do not solve structural problems and need to be changed, as happened with the measures taken by other governments in Europe," Enel Group CEO Francesco Starace said in November.

Romania's Government enacted, in line with the European Union's recommendations on this topic, a set of measures to be enforced over this winter (until March 2022) with the aim of helping households weather the high energy prices. Thus, an 80% windfall tax is levied on the revenues derived by energy generators that sell their output at prices above RON 450 (EUR 90) per MWh.

(Photo source: Gov.ro)