The Slovenian government has unveiled a draft law that would impose a windfall tax on energy companies in 2022 and 2023 in a bid to subsidise renewables and finance measures to reduce electricity demand during peak times.

Under the proposal, any revenue in excess of EUR 180 per MWh of electricity produced in Slovenia and sold on the wholesale market here would be channelled into the national budget.

Power companies whose production costs exceed EUR 180 per MWh would be exempted, as would electricity generated using natural gas and small installations with a peak output of under 500 kW.

A windfall tax would also be imposed on companies that produce and process crude oil and natural gas in Slovenia.

They would pay a "solidarity charge" for 2022 and 2023, defined as the difference between corporate profit in 2022 or 2023, and average profit in 2018-2021 multiplied by a factor of 1.2.

The vast majority of major energy players in Slovenia, which includes almost the entire electricity sector, are partially or wholly owned by the state.

The windfall tax is attached to a series of measures designed to reduce demand at peak times by at least 5% during winter.

The Infrastructure Ministry is soliciting comments until 24 November before the government adopts the law.