The head of the EU today pledged to slap a windfall tax on energy giants to send record profits to “those who need it”.
Ursula von der Leyen spoke after Brussels drew up draft proposals for all EU countries to impose a 33% levy on "taxable surplus profits made in the fiscal year 2022”. It would apply to oil, gas, coal and refining companies established in the EU.
Separately the European Commission chief vowed a revenue cap on electricity generators, that have benefited from soaring gas prices while not actually using gas to produce power.
Draft plans seen by Reuters suggested a price limit per megawatt hour for wind, solar, nuclear and biomass plants - of 180 Euro/MWh while prices trade close to 500.
The measures were among a series she tabled during her annual State of the Union address in Strasbourg.
"Making ends meet is becoming a source of anxiety for millions of businesses and households," she said.
"In these times it is wrong to receive extraordinary record revenues and profits benefiting from war and on the back of our consumers.
“In these times, profits must be shared and channelled to those who need it most.”
It comes days after Liz Truss refused pleas to impose a fresh windfall tax on oil and gas or electricity generators, despite borrowing around £100bn to cap energy bills in the UK.
A 25% levy on oil and gas producers is being imposed by the UK, but Labour argues has too many gaps and get-out clauses.
The new Prime Minister has refused to impose a new windfall tax, saying: "It is the wrong thing to be putting companies off investing in the UK just as we need to be growing the economy."
The EU’s full proposals are only due to be published later and governments will then thrash out details for possible approval on September 30.
Calling for cuts in electricity usage across the EU, Ms von der Leyen urged families and firms to slash the amount of power they consume.
“I want our union to take example from its people - so reducing demand during peak hours will make supply last longer and it will bring prices down,” she said.
“This is why we’re putting forward measures for member states to reduce their overall electricity consumption.”
EU gas storage is now 84% full ahead of winter despite Russia strangling off supplies, but analysts say Europe will still need to slash gas use over winter.
Ms von der Leyen urged the bloc’s 27 European nations to show “resolve, not appeasement” as Putin tightens his grip on supplies amid the war in Ukraine.
Ukrainian First Lady Olena Zelenska was in the European Parliament in Strasbourg to listen to Mrs von der Leyen’s annual State of the Union speech, which was dominated by the Kremlin’s invasion and the cost-of-living crisis.
Insisting the EU's solidarity with Kyiv would be "unshakeable”, the bloc chief said: "This is the time for us to show resolve, not appeasement.”
She added: "We are in it for the long haul."
Wearing blue and yellow - the colours of both Ukraine's and the EU flags - for her 59-minute speech, Mrs von der Leyen said she had “the conviction that with courage and solidarity, Putin will fail and Europe will prevail".
Fuelling accession hopes among the bloc’s eastern neighbours, she claimed the EU was incomplete without Ukraine, Moldova, Georgia and Western Balkan countries.
"You are part of our family, you are the future of our union," she told the nations. "Our Union is not complete without you."
