More than one in three companies saw the cost of natural gas triple by 2022, coupled with a similar increase in electricity costs for one in six industrial units. The data comes from the most recent survey by the Portuguese Business Association (AEP). Reducing activity is the solution indicated by six in ten respondents; 18% admit the use of layoffs and 17% the partial closure of production units. Eight out of ten entrepreneurs are cutting back on investments. Luís Miguel Ribeiro, president of AEP, says that “it is absolutely necessary” to reduce energy taxes, “which were already high even before the pandemic and the war”, and to take “effective and efficient measures” to help “the exponential rise” of production costs. On pain of many who even come “close”.
Determined to know the “concrete impact” on national companies of the energy crisis facing Europe, and the measures they would like to see implemented to mitigate “the impact” in their operations, AEP launched a questionnaire showing that the increase in For 39% of the companies, natural gas was in the order of 200% or triple, and in 6% of the cases the increase was between double and triple. In the case of electricity, one in six saw increases of 200%, with 18% reporting an increase between 100 and 200%.
In terms of fuel, more than half (53%) of registered companies indicate increases between 20% and 50%, but 8% indicate increases between 100 and 200%.
For a third of entrepreneurs, energy costs weigh between 20 and 40% of their operating costs, but there are 14% where this weight varies from 40 to 60%. And for 2% of the respondents, energy costs weigh more than 80% in their costs. The survey, conducted among a sample of 1020 companies, also found that only 8% of respondents, i.e. one in 12 companies, admit that they can fully pass on the escalation of energy bills in the final sale price. 46% manage to make a partial rebound.
In addition to the reduction in activity – less than 25% for 41% of companies and increased scale for 19% – companies are planning to change their product range in response to rising energy costs. The increase in remote working is only a viable solution for 8% of respondents, which is not surprising given that 74% of the responses came from companies in the manufacturing industry.
As a result of all this, short-term investment intentions will be reduced in 80% of cases, with 45% of entrepreneurs admitting a moderate cut, but 35% even talking about a “very significant” cut.
In terms of measures, almost all respondents advocate lower energy taxes and “rapid support” from European funds. In this area, AEP and staff plan to reassign the recovery and resilience plan to combat the energy crisis, namely by supporting investments in more efficient equipment and alternative energy sources. Entrepreneurs also want the government to reduce the tax burden on wages and wealth, as well as a reduction in VAT on the purchase of equipment for the production of green energy.
In addition to measures to support the treasury of companies, the revision of the new Mibel mechanism is necessary. It should be noted that 64% of the respondents did not benefit from the recently agreed extraordinary mechanism (decoupling of the price of gas and the price of electricity). It is also interesting that 13% of the companies have voluntarily entered into a new electricity contract, but 30% have a new contract due to the termination of the previous one by the supplier in view of the soaring prices in the wholesale market.
About the sample: 48% of the respondents are both exporters and importers of goods and 77% are SMEs. In terms of location, 61% are from the north, 22% from the Lisbon metropolitan region and 17% from the Center region.
Source: DN
