The Energy (Windfall Gains in the Energy Sector) Bill 2023 will introduce a “temporary solidarity contribution” based on taxable profits in the fossil fuel production and refining sectors, as well as a cap on the market revenues of some generators in the electricity sector.

The measures are expected to bring in between €280 million and €600 million, the government said.

Proceeds from the cap no market revenues will be collected in September 2023, while proceeds from the windfall tax will be collected in September 2023 and September 2024.

The general scheme has been developed by the Department of the Environment, Climate and Communications following consultation with relevant Departments, agencies and stakeholders.

It seeks to “ensure collection of windfall gains while minimising the impact on energy markets, security of energy supply and future investments”, the Department said.

Further consultation with stakeholders and the joint Oireachtas committee on environment and climate action is expected as the detailed legislation is developed.

The government intends to enact the legislation before the summer recess.