Evaluation of Hardship Cases According to the National Emission Allowance Trading Act

With the National Emission Allowance Trading Act (NEHG 2022), a CO2 levy will be introduced in Austria in 2022, which will be charged on fossil fuel consumption outside the current scope of the EU Emissions Trading Scheme (EU ETS). Starting from 30 € in 2022, it will eventually amount to 55 € per t CO2 in 2025. The NEHG 2022 provides for compensatory measures to cushion particular additional economic burdens. One of them refers to a list of economic sectors contained in Annex 2 of the Act, which can apply for relief in order to avoid carbon leakage and to maintain competitiveness. Another compensatory measure aims at avoiding "special hardship cases". Such hardship cases are companies whose energy expenditure for fossil energy sources in relation to total expenditure or whose CO2 tax burden in relation to value added exceeds the limits provided for in the law. The present evaluation examines in which sectors such special hardship cases are to be expected.