The Nordic countries cannot implement the EU’s income ceiling together – civil servants
Coordination of the implementation of the income ceiling had been discussed in the Nordic countries, but the timetables were too tight for detailed coordination to be possible, said Tatu Pahkala, energy market adviser at the Ministry of Economy.
It was important to design a system that does not disturb the market’s price signal too much, he said, adding that Finland is considering ways to change its corporate tax to implement the ceiling.
The Finnish Ministry of Economy as the star of November told Montel said it would not be able to implement the cap by December 1, and it suspected other European countries would also face difficulties.
“Don’t rush reform”
Damsgaard said the Swedish government plans to exclude hydropower storage to avoid distorting price signals for hydropower generation, and incentives to participate in balancing markets will also remain intact.
“My understanding is that the Swedish government is aware of these issues and is dealing with them,” he said of the implementation, adding that there are other power generation units that may be affected.
“We have these short-term measures that hopefully won’t hurt the market in the long term. It is important not to rush into big changes, Damsgaard added, fearing that governments would rush to implement permanent changes to market design due to the continent’s current energy crisis.