Italy’s energy giant reports huge profit as more price hikes expected

ENI reported a 311-percent increase in net profits on Friday, reviving debate on the need for a windfall tax on energy companies.

Italy's energy giant reports huge profit as more price hikes expected
Italy's energy giant ENI reported a 311-percent increase in net profits on Friday. Photo by Marco BERTORELLO / AFP

Italy’s main energy provider ENI raked in 10.8 billion euros in adjusted net profits over the first three quarters of 2022, up by a whopping 311 percent compared to the same time last year.

Like the entire European oil and gas sector, ENI has benefited from a surge in prices linked to the resumption of global economic activity after the coronavirus pandemic, as well the effects of Russia’s invasion of Ukraine.

READ ALSO: EXPLAINED: How much are energy prices rising in Italy this autumn?

ENI’s quarterly report, which exceeded even the most generous of industry estimates, was released as Italian households and businesses face further increases in their energy bills.

Italian power regulator Arera said last month that electricity prices would rise by 59 percent in the final quarter of the year.

This means that the average Italian household will spend 1,322 euros on electricity bills alone in 2022 – the same figure stood at 632 euros last year.

Gas stove

Italian power regulator Arera hasn’t yet released official gas prices for the coming months, but the latest projections indicate an increase of up to 74 percent. Photo by Ida Marie ODGAARD / Ritzau SCANPIX / AFP

As for gas, the regulator has not yet released official prices for the coming months, but the latest projections indicate an increase of up to 74 percent against this year’s third quarter, with gas prices expected to reach 184 euros per megawatt hour. 

The record profits of energy providers set against soaring bills have revived debate over the need to impose windfall taxes.

READ ALSO: The five biggest challenges facing the new Italian government 

Italy’s former government, led by Mario Draghi, had already introduced a 25-percent  windfall tax (tax on extra profits) for energy companies earlier this year.

But out of the 10.5 billion euros that the country expected to pull in through the tax, the state coffers have only received just over a billion, with thousands of companies refusing to pay and some challenging the constitutionality of the surcharge.

Giorgia Meloni, new Italian PM

Italy’s new government, led by Giorgia Meloni, says it plans to ‘improve’ the existing windfall tax on energy companies. Photo by Angelo CARCONI / AFP

Italy’s new government, which said financial support for families and businesses is one of its most urgent priorities, has pledged to make changes to the existing windfall tax.

READ ALSO: Five key points from Meloni’s first speech as new Italian PM

Adolfo Urso, head of the newly renamed Ministry for ‘Enterprise and Made in Italy’, said on Friday that, while Italy is pushing for a Europe-wide energy price cap, the new government will “improve the [windfall] tax” and use income from it to “curb soaring bills”. However no further details have yet been released about the plan.

The new government said it was also considering other measures to mitigate the effects of the energy crisis, though there are concerns these may need to be funded via a potential increase in the country’s public debt – which already stands at a mammoth 3.7 trillion euros.

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Can British people in Italy claim the UK’s winter fuel payment?

In the UK, there are various benefits available to help eligible people through the cold winter months – one of which is the winter fuel payment. But can Britons living in Italy really claim this benefit to cover the cost of heating their Italian homes?

Can British people in Italy claim the UK’s winter fuel payment?

Average winter temperatures vary across Italy, but those who move here after only experiencing scorching summers are often surprised to discover just how cold the country can get.

Even the hardiest of arrivals from colder climes will no doubt have to switch on the radiators or fire up the woodburner between November and February – despite the surging costs.

READ ALSO: Not just gas: How the cost of heating has soared in Italy

As the cost of living crisis bites, some UK nationals who reside in Italy may wonder if they could still be eligible for winter fuel financial support from the UK.

What is the UK’s winter fuel payment?

The UK’s winter fuel payment is a tax-free payment to help older people with heating costs during the cold winter months.

Those eligible must have been born before September 26th 1956, according to the UK government’s website.

How much people receive depends on their age and whether anyone else in the household is also eligible, but the amount is usually between £250 and £600.

I’m a UK national living in Italy. Can I claim the winter fuel payment?

Yes, if you meet the following criteria according to the British government’s website:

“If you do not live in the UK, you’re only eligible for the Winter Fuel Payment if:

  • you moved to an eligible country before 1 January 2021
  • you were born before 26 September 1956
  • you have a genuine and sufficient link to the UK – this can include having lived or worked in the UK, and having family in the UK”

Unlike Spain and France, which the British government has deemed to be too warm on average, Italy is on the list of eligible countries along with Austria, Germany, Sweden, and others.

Find out how to claim the fuel payment on the UK government’s website here.

According to the UK government, during winter the average temperature is between 2 and 7 degrees Celsius in the UK.

READ ALSO: At what time of day is electricity cheapest in Italy?

The Italian government divides the country into six ‘climate zones’ which determine when and for how long residents should have their heating switched on each winter.

According to the government’s classification, the coldest parts of the country are the northern provinces of Cuneo, Trento, and Belluno, where no heating restrictions apply.