Such a reform, demanded for a long time by France but which divided the Twenty-Seven, will be on the menu of a meeting of European energy ministers, on September 9 in Brussels.
“The surge in electricity prices clearly shows the limits of the current functioning of the market. It had been designed in a very different context,” admitted the President of the European Commission, Ursula von der Leyen, during a conference in Bled (Slovenia).
“That is why we are currently working on emergency intervention and structural reform of the market,” she said, without further details.
The September 9 date was announced on Monday by Czech Industry Minister Jozef Sikela, whose country holds the rotating EU presidency. “We need to fix the energy market. The solution at EU level is by far the best,” he stressed on Twitter.
German Chancellor Olaf Scholz also urged member states on Monday to agree “quickly” and in a “coordinated manner” on a reform. The current system “cannot be described as functional if it leads to such high electricity prices”, he said.
“Set a maximum price”
The Belgian Prime Minister added his voice to his calls, during a speech before the Offshore Northern Seas Conference (ONS) in Stavanger, Norway. Mr. De Croo sought to convince Norway – Belgium’s main gas supplier – of the usefulness of setting a European ceiling price for natural gas. In his speech, the Prime Minister compared the energy crisis to the financial crisis of 2008. As at the time, he believes that we must “intervene and regain control of the market. And he wants the European Union to take the initiative “by setting a maximum price that we are ready to pay for gas and electricity”
For Alexander De Croo, it is “intolerable that the energy market is draining our businesses and our households” in view of the big profits that energy companies are reaping. An abnormal situation that the Prime Minister wants to “settle”.
Growing calls
Calls to change the common electricity market grow as, following six months of war in Ukraine, energy prices soar to stratospheric levels, raising fears of a winter cost of living explosion next.
On the European market, it is the cost price of the last source of electricity mobilized to meet demand, often gas-fired power stations, which determines the price imposed on all operators on the continent. This price soared in concert with the surge in gas prices linked to the drastic drop in Russian gas deliveries to Europe.
On Sunday, Austrian Chancellor Karl Nehammer called on the EU to “decouple the price of electricity from that of gas” to “stop this madness”. According to him, this decoupling will be on the menu of the September 9 talks. On the same day, the Belgian Energy Minister, Tinne Van der Straeten, called for the reform of “a failed market”, which is “no longer tenable for many consumers and families”.
This decoupling was demanded by Paris, which believes that French consumers are penalized, prevented from fully benefiting from the low costs of nuclear power by a mechanism deemed “obsolete”.
Last year, in a joint declaration published in October 2021, nine Member States, including Germany, were fiercely opposed to any reform of the electricity market, judging the current system effective in “contributing to innovation and “facilitate the transition” to green energy.