The EU energy ministers ask the European Commission to present electricity saving measures, caps on the benefits of renewables and a liquidity instrument
The Czech presidency of the EU does not rule out convening another extraordinary council during the month of September to approve proposals
The legislative proposals that the European Commission will present next Tuesday, September 13, to intervene in the European energy market must include measures to reduce the demand for electricity in a coordinated manner, to limit the extraordinary income of electricity producers such as renewable or nuclear, and a new liquidity instrument to support energy operators operating in the futures market. These are some of the elements that have received the support of the EU energy ministers during the extraordinary council held this Friday. The “urgency” meeting also leaves the mandate for the Community Executive to explore some type of cap on the price of gas, although he still does not like the idea of putting an exclusive cap on the price of Russian gas.
The EU energy ministers thus endorse the bulk of the ideas launched in the middle of the week by the President of the European Commission, Ursula von der Leyen, to intervene in the European energy market and put an end to the price spiral in the face of a situation that has continued to worsen over the past year. “Today’s debate has not been easy. This is not the last time we will meet to talk about energy prices. What we have done is give a clear message about what we have to do & rdquor ;, explained the Czech minister and rotating president of the Council this semester, Jozef Sikelaon the four major areas that they hope to see reflected in the legislative proposals that will serve as the basis for the real negotiation.
And the first thing that they consider urgent, in line with the ideas put forward by von der Leyen, is to limit the income of inframarginal electricity producers with low production costs, such as renewables or nuclear, with the aim of allocating that additional income to reduce the bill of consumers and companies. They also agree to launch a “solidarity contribution & rdquor; of fossil fuel companies – oil and gas companies – that Member States can use to mitigate the impact of high energy prices on customers.
Gas price cap
The Twenty-seven also estimate that the Brussels plan should include an “emergency and temporary intervention & rdquor; to rein in gas prices, including a gas price cap. An idea not included in the draft intentions of the Commission in which only a cap on the price of Russian gas appears. An idea that, although it generates sympathy in some capitals that support directly punishing the Kremlin for using gas as a “weapon of war”, does not arouse consensus. “It is a painful thing, particularly for Austria. We have managed to reduce dependence on Russian gas from 80% to below 50% but we are still dependent. That is why we cannot support this proposal at this time & rdquor ;, the Austrian minister acknowledged, Eleanor Gewessler. Hungarymain ally in the EU of Vladimir Putin, goes further. His foreign minister, present at the meeting, has dismissed the idea as absurd because it does not eliminate the risks to security of supply.
The energy commissioner Kadri Simson, It has not clarified whether they will eliminate the option of the battery of measures on Tuesday or whether they will extend the umbrella of the cap to all natural gas, including that imported from other producing third countries. “The ministers have asked us to analyze the effects of setting a cap on gas from other imports to the EU” but “if what we want with our proposal is to confront Russian manipulation, it makes sense to address a cap on Russian gas & rdquor; She has recalled about a general cap that countries such as Belgium or Italy have been demanding for many months and that, according to her, could put the security of supply in the EU at risk.
“The liquefied natural gas market is a global market and there is fierce competition. At this time it is important that, by losing Russian volume. we may choose alternative providers. We are looking at other possibilities to reduce the price, substituting Russian production for that of other more reliable partners & rdquor ;, he reported without clarifying whether they will follow the Council’s mandate in this area. “It is the most complex thing that we have to decide & rdquor ;, has admitted the Czech minister who has recognized that this issue needs “more work & rdquor ;.
According to Sikela, capping the price of gas should serve to “alleviate the social and economic consequences of the current high energy prices & rdquor; which means that it could resemble a species “Iberian exception & rdquor; for the entire EU, a path included in the preparatory document of the Czech presidency, ruled out until now by the Commission, but which is of interest in countries such as France or Romania, as indicated by the third vice-president of the Government, Theresa Rivera.
The meeting also leaves a request to create “emergency liquidity instruments” to ensure that energy companies have sufficient collateral at their disposal to deal with today’s distorted markets. Lastly, the Twenty-seven have closed ranks with the idea of encouraging a coordinated reduction of electricity demand across the EU, to relieve pressure on electricity generation and tackle energy shortages and high energy prices. The initiative in which the European Commission is working proposes a mandatory saving of 5% at peak times at all times. According to the Czech presidency of the EU, the approach should be similar to the one agreed to reduce gas demand. That is, a system with voluntary savings targets that could become binding in the event of problems.