Rising energy costs: what government support measures are available to businesses?

Regulatory mechanisms have been put in place to secure the supply of goods and services for businesses across the country.

Fabien Gélisse
Consultant HSE
Publication : 
Table of Contents
Example H2
Request a demo

Please note: This article concerns French legislation. The requirements described may not apply in other countries.

The consequences of the war in Ukraine are far-reaching and have had a significant impact on the energy sector in France. This is further compounded by the closure of certain nuclear reactors for maintenance.

In this context, the government has introduced a series of regulatory support measures for businesses. This article outlines the primary aid mechanisms available. Additionally, measures have been established to secure energy supplies (link to article 2).

"Energo" Aid (natural gas and electricity)

Decree No. 2022-967 of July 1, 2022, establishing aid to offset the rise in natural gas and electricity supply costs for businesses significantly affected by the economic and financial consequences of the war in Ukraine.

This aid (known as the Gas/Electricity Aid or Energo Aid) is available to businesses with tax residency in France that carry out economic activities significantly affected by the economic and financial consequences of the war in Ukraine and that meet the following eligibility criteria at the time of application:

  1. They were established before December 1, 2021, are not currently in safeguard, receivership, or liquidation proceedings, and had no outstanding tax or social security debts as of December 31, 2021;
  2. If organized as an association, they are subject to commercial taxes or employ at least one staff member;
  3. They are energy-intensive businesses (*);
  4. They paid a unit energy price for at least one month during the eligible period that was at least double the average unit price paid during the reference period between January 1, 2021, and December 31, 2021.

(*) Energy-intensive businesses: businesses whose energy expenditures (i.e., related to energy purchases, including all taxes except deductible value-added tax) represent at least 3% of the turnover generated during the reference period.

Note: Businesses whose primary activity is the production of electricity or heat, or those operating as credit or financial institutions, are not eligible for this aid.

Applications for aid must be submitted via the professional portal on the tax website (https://www.impots.gouv.fr):

  1. for the months of March, April, and May 2022, between July 4 and December 31, 2022;
  2. for the months of June, July, and August 2022, between October 3 and December 31, 2022;
  3. for September and October 2022, between November 15, 2022, and January 31, 2023;
  4. for November and December 2022, between January 16 and February 24, 2023.

The aid is calculated as follows:

Aid cap Period 1
(March, April, May)		 Period 2 (June, July, August)
Period 3 (September, October)
Period 4 (November, December) 		Amount of aid
€2m Companies experiencing a 30% drop in EBITDA compared with 2021, or with negative EBITDA Companies experiencing a drop in EBITDA compared with 2021, or with negative EBITDA 30% of eligible costs
€25m Companies with negative EBITDA where the increase in eligible costs amounts to at least 50% of the absolute value of EBITDA 50% of eligible costs, capped at 80% of the absolute value of EBITDA
€50m Companies listed in Annex 1 of the decree, with negative EBITDA, where the increase in eligible costs amounts to at least 50% of the absolute value of EBITDA 70% of eligible costs, capped at 80% of the absolute value of EBITDA

Note 1: For businesses that are part of a group, the aid caps are assessed at the group level.

Note 2: Compliance with eligibility criteria regarding electricity and gas expenses, gross operating surplus (EBE), and eligible costs must be verified and calculated by a trusted third party (chartered accountant or statutory auditor).

Tariff shield

The tariff shield implemented for individuals also benefits businesses with fewer than 10 employees, an annual turnover of no more than €2 million, an electricity meter with a power rating of less than 36 kVA, and which are on regulated tariffs.

This measure limits electricity price increases to a maximum of 15% starting from February 2023 (this limit was 4% in 2022).

For eligible businesses, the mechanism is automatic and requires no specific action.

Electricity buffer

A second measure, announced on October 27, 2022, aims to support businesses that do not qualify for the "Energo" aid (see point 1) or the tariff shield (see point 3). The regulatory framework has not yet been published.

All regulatory provisions regarding these support mechanisms have not yet been published. The information provided in this article is subject to adjustment based on government decisions and the evolving situation.