Donald Tusk’s team wants to finance the energy price freeze with money from Orlen. The stock market reacted sharply to this announcement.
Recently, the issue of energy price freezes has returned. The coalition consisting of KO, Trzecia Droga and Left wants Orlen to cover the energy price freeze. The cost of such a solution was estimated at PLN 15 billion.
“Members of the majority coalition have agreed on a draft law on energy prices, wind farms and a special contribution of almost PLN 15 billion to be imposed on Orlen,” reports the website Wysokinapiecie.pl.
The stock market reacts, Orlen’s shares fall
The stock market reacted strongly to these reports and on Wednesday afternoon Orlen shares fell sharply – by as much as 7.3%. and their price dropped below PLN 60.
This means real losses for the companies. Here is Orlen’s market value, which was over PLN 75 billion on Tuesday, but today has fallen to only PLN 69.6 billion. In just a few hours after the start of the stock market session, the company’s value fell by PLN 5.5 billion.
The levy proposed by the Civic Coalition and Poland 2050 would eat up about half of Orlen’s annual profits (in the twelve months ending September this year the company earned PLN 31 billion).
The Ministry of Finance owns 49.99 percent. Orlen shares, while the rest are owned by private investors. The KO and PL2050 law would therefore mean taking half from the Ministry of Finance and the other half from private entities.
PiS project
PiS has also submitted a bill to the Sejm about freezing energy prices next yearwhich was adopted by the government of Mateusz Morawiecki.
The government project assumes that from 2022, prices would be applied up to the limit of 3 MWh for households, for households with a restriction up to 3.6 MWh, and for farmers and holders of the Large Family Card up to 4 MWh. After exceeding the limit, a maximum price of PLN 693/MWh would apply.
Source: Do Rzeczy
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
