The latest bulletin from the European Central Bank reveals dramatic disparities in energy prices within the eurozone. In Italy, Germany, and Spain, households pay on average twice as much for electricity as large energy-intensive enterprises. In response, the Italian government has adopted a decree aimed at lowering costs for the poorest, which, however, triggered a sharp sell-off of energy companies on the Milan stock exchange.

Drastic Price Differences

Italian families pay 100% more for electricity than large industry, which is one of the highest rates in the entire eurozone.

New Protective Decree

The government introduces an excess profits tax (IRAP) for energy companies to finance bill subsidies for citizens.

Threat of US Tariffs

Italian industry fears 50-percent tariff proposals on steel and aluminum exported to the United States.

Crisis in Ukraine

The destruction of 2000 medical facilities and lack of power at -20 degrees threatens the lives of millions of people.

An analysis conducted by the European Central Bank (ECB) indicates that residents of Italy, Germany, and Spain are in the most difficult situation regarding electricity costs. While in the Netherlands families pay 20% more than industry, in Italy this difference is as high as 100%. Higher rates result from system charges, taxes, and the weaker bargaining power of individual consumers against suppliers. This phenomenon exacerbates economic uncertainty in the region, which the ECB describes as stemming from a "volatile political context" and the risk of new trade frictions. In response to the crisis, the Italian Government approved new protective measures via a decree. They include a bonus system for the poorest families and an increase of 2 percentage points in the IRAP tax for energy producers. This decision triggered an immediate reaction on Piazza Affari, where shares of energy giants recorded significant declines. Experts, including Davide Tabarelli from Nomisma Energia, warn, however, that real consumer savings could be quickly offset by global gas price fluctuations. Since the energy crisis triggered by Russia's invasion of Ukraine in 2022, European Union states have been grappling with the need to overhaul support systems for individual consumers while maintaining the competitiveness of heavy industry. An additional burden for the European economy remains the specter of tariffs. Representatives of Confindustria are monitoring the situation related to American efforts to impose a 50% tariff on products containing aluminum and steel. Although some experts assess these announcements as "much ado about nothing," the long-term effects for exporters from Genoa and other industrial centers could be severe, forcing companies to seek alternative markets such as India or Mercosur countries. In the background of economic disputes, a humanitarian drama is unfolding in Ukraine. The organization Doctors Without Borders warns that with temperatures dropping to -20 degrees Celsius, the systematic destruction of energy infrastructure by Russian bombings is making civilian life impossible. Since the start of the war, over 2000 medical facilities have been damaged there, which, combined with a lack of heating, becomes a form of warfare targeted at the civilian population. Italy: 100, Germany: 100, Spain: 100, France: 64, Netherlands: 20

Mentioned People

  • Davide Tabarelli — President of Nomisma Energia, critically assessing government solutions regarding energy prices.