Energy crisis: Belgian companies are begging for help

This afternoon, the Consultative Committee is meeting to discuss the energy crisis. Questions and demands are coming from various quarters. Not only are end-user bills skyrocketing, but company bills are getting higher too.

Some companies, such as stainless steel manufacturer Aperam and fertiliser producer Yara, have already decided to temporarily stop their production due to the high energy prices. At Yara, however, the staff can continue to work with pay, because they remain active for the maintenance. Director of the Federation of Enterprises in Belgium Pieter Timmermans fears that even more energy-intensive companies will cut back on production as a result of the high energy prices. He is thinking of glass and brick producers, the textile sector, woodworking or the food industry.

The Flemish employers' organisation Voka is asking the government to provide "temporary and targeted" support for the most affected companies. "The European Commission allows this via the Temporary Crisis Framework and other countries such as Germany and France have already implemented the system," it says. A price ceiling at European level should also offer solace. Voka also asks that the flexible regime around temporary unemployment - which was introduced a few years ago because of the corona crisis - be applied to the energy crisis.

"Voka expects that the energy crisis will bring further temporary production stops and reductions. A flexible system of temporary unemployment can ensure that the purchasing power of the affected employees remains intact as much as possible," says the employers' organisation.

Agoria, the sector federation for the technology sector in Belgium, also said it had put a number of "unconventional measures" on the table to counter the rising energy costs for the industry.

"We are really in injury time now, the high energy prices are really putting many tech companies in big trouble. The energy price has far too high an impact on our competitiveness, so we need to avoid companies cutting back on production. Without a political decision, the industry has its back against the wall," says Agoria. The sector federation represents a number of major consumers such as Aurubis, Nyrstar, Aluminium Duffel, Sonaca, Thales, Daxi, JTEKT, Safran Aero Boosters and Halo Steelrings. According to Agoria's own calculations, the costs for the Belgian technology sector will rise by 10 billion euros in 2023.

One of the measures Agoria proposes is to extend on a larger geographical scale the intervention already made by Spain and Portugal to limit the spill-over effect from the gas market to the electricity market. "Preferably on a European scale, if that does not seem feasible at least with the countries we are interconnected with".

Another proposal is a temporary exemption for the electricity sector in Europe from buying emission rights. The cost of these CO2 rights in the European Emission Trading System (ETS) has risen sharply in recent months, and this cost is passed on in the electricity price. Agoria also wants "a maximum compensation of the indirect emission costs".

Finally, the federation asks for the temporary use of the European state aid framework. "On 23 March the European Commission already adopted a state aid framework, which was further adapted in July. This framework allows, within certain modalities, to compensate affected companies. Several EU Member States have already implemented this nationally. Agoria is calling on Belgium to also implement this state aid framework in a targeted manner."

© Pieter Timmermans Managing Director of the Federation of Enterprises in Belgium