Law Proposal No. 61/XIV - State Budget for 2021
Main Changes in the Energy Sector
Law Proposal No. 61/XIV was submitted on October 12 to the President of the Assembly of the Republic. Such act marks the beginning of the approval process in the Parliament of the State Budget for the year 2021.
Although this proposal has not yet been approved, we believe it is relevant, at this stage, to give note on the main changes that are anticipated in the field of Energy:
Costs with the social tariff of natural gas (Article 197)
The costs arising from the application of the social tariff to natural gas customers are borne by the companies that transport and supply this type of gas, in proportion to the volume of gas sold in the previous year.
Environmental Fund (Article 199)
In 2021, it is expected that the Government merges the Permanent Forest Fund, the Innovation Support Fund, the Energy Efficiency Fund and the Fund for Systemic Sustainability of the Energy Sector into the Environmental Fund.
It is also foreseen that during the year 2021, the amount related to the tax collections due to the tax harmonization between heating oil and road diesel will be transferred from the State sub-sector budget, up to the limit of EUR 32,000,000.00, to the Environmental Fund.
Support to the Bio-waste Strategy (Article 200)
In order to support the implementation of the Bio-waste Strategy, aiming to divert bio-waste from landfills and incineration through separation and recycling solutions at source and a selective collection network, contributing to the mitigation of climate change, the return of organic matter to the soil and energy production, this Proposed Law provides that the Environmental Fund may grant support to municipalities or associations of municipalities up to a maximum amount of EUR 2,000,000.00
Incentive of the introduction into consumption of low emission vehicles (Article 202)
Within the scope of the climate action measures, it is foreseen that the incentive for the introduction in consumption of zero emission vehicles, financed by the Environmental Fund, which will be defined by order of the Government member responsible for the environment and climate action area, will be maintained.
This incentive will be extended to two-wheeled motorcycles and bicycles, conventional or electric, and to electric mopeds that have European homologation and are subject to registration. It will also cover cargo bikes.
Incentive to electric mobility (Article 203)
Once again, through the Environmental Fund, it is expected that the Government will continue the program to encourage electric mobility in the Public Administration, supporting the introduction of 200 electric vehicles exclusively for Public Administration bodies, including the location, for which the vehicles are indispensable for their operational activity, in line with the objectives of the "ECO.mob" project, approved by Resolution of Council of Ministers No. 54/2015 of July 28th. Such support should privilege low density territories.
Amendment to the Excise Code (Article 234)
Article 90 - Exemption for biofuels and gases of renewable origin
On paragraph 11 of the above-mentioned article is provided for advanced biofuels to benefit from full tax exemption, provided they are certified with the Biofuel Title, as well as gases of renewable origin, provided they are certified with the Guarantee of Origin.
Transitional provision on oil and energy products (Article 237)
Transitional provisions are provided for products that are used in the production of electricity, electricity and heat (cogeneration), or city gas, and their rate of taxation will vary according to the code of the respective products and until 2025.
Transitional arrangements are also provided for petroleum and energy products that are used in facilities subject to an agreement to rationalize energy consumption.
In any case, this will not apply when biofuels, biomethane, green hydrogen or other renewable gases are used.
The revenues resulting from the taxation foreseen above are earmarked for the National Electric System or for the reduction of the tariff deficit of the electric sector, in the same year of its collection, to be allocated to the Energy Sector System Sustainability Fund (50%) and the Environmental Fund (50%).
Extraordinary contribution on the energy sector (Article 259)
In 2021, it is foreseen the maintenance in force of the extraordinary contribution on the energy sector, whose regime had been approved by article 228 of Law No. 83-C/2013, of December 31, in its current wording.
The Government will also evaluate the change in the rules of the extraordinary contribution on the energy sector, either by changing the rules of incidence, or by reducing the respective rates, given the context of sustained reduction of the tariff debt of the SEN and the implementation of alternative forms of financing of social and environmental policies of the energy sector, aiming to stabilize the legal framework of this contribution and reduce the litigation around it.
Law Proposal No. 61/XIV can be consulted here.