EU energy ministers have reached an agreement on emergency measures to help households and businesses deal with soaring energy prices, the Czech Presidency of the Council of the EU has announced.
These measures consist of recovering part of the “superprofits” energy producers to redistribute them to the consumer, and to reduce the demand for electricity at peak times. In total, revenues of around 140 billion euros might thus be donated, estimated in September the President of the Commission Ursula von der Leyen.
Consume less to pay less
The approved emergency measures set a binding target for States to reduce their electricity consumption “by at least 5%” during peak hours. The Twenty-Seven are also called upon to reduce their monthly electricity consumption by 10%, an indicative objective.
Another measure: the ceiling on the income of electricity producers from nuclear and renewables (wind, solar, hydroelectric) who reap exceptional profits by selling their production at a price much higher than their production costs. This ceiling is set at 180 euros per megawatt hour and the difference between this level and the wholesale market price must be recovered by the States to be redistributed to households and businesses. A “temporary solidarity contribution” also applies to producers and distributors of gas, coal and oil.
Discrepancies still present
But the ministers are still divided on a cap on the price of gas imports, which comes up once morest German reluctance in particular. “There’s no time to lose” to bring down the price of gas, urged Czech Energy Minister Jozef Sikela, whose country holds the EU Council Presidency. For the Czech Minister, the Commission must act quickly: “We are in an energy war with Russia, winter is coming and we have to act now (…), not in a month.”
Ahead of the meeting held this Friday in Brussels, a majority of Member States – fifteen, including France, Belgium, Italy and Spain – also considered it necessary to tackle the “most serious problem” : they claim a cap on wholesale gas prices on the European market. These countries want the measure to apply to all gas imports, not just those from Russia. And certain “are more and more nervous” the attitude of the Commission, according to a European diplomat.
The Community executive, like Germany, is reluctant to take such a measure, fearing that limiting prices will threaten European supplies by dissuading “reliable partners” such as Norway or the United States to supply the EU with gas, for the benefit of Asia. The Estonian Minister, Riina Sikkut, also spoke out once morest this idea, believing that “Gas availability and security of supply were more important than price”.
Ceilings for some, not for all
In a preparatory document, the Commission proposed setting a maximum price for Russian gas – transported by pipeline or liquefied natural gas (LNG) – which currently represents 9% of European imports. Russia was historically the EU’s biggest gas supplier, bringing more than 40% of the gas to the bloc. To lower prices, Brussels is betting on negotiations with other suppliers of gas transported by pipeline, but believes that for LNG, the ability to negotiate is limited by international competition. The Commission is also considering capping the price of gas used for electricity generation.
These options are being discussed by the ministers and should give rise to a more detailed plan, before a summit of the leaders of the Twenty-Seven on October 7 in Prague and a new meeting of energy ministers on October 11-12.
“We must go further on these subjects and we must conclude more quickly”, also estimated the French Minister Agnès Pannier-Runacher. Many EU countries have already put in place support schemes at national level to relieve households and businesses strangled by bills. Like France, which applies caps to energy prices, Germany announced Thursday that it would release up to 200 billion additional euros to limit gas and electricity prices.