The European Commission’s plan to cap gas prices does not convince

Return to sender. European energy ministers, meeting in Brussels on Thursday 24 November for an emergency meeting, asked the European Commission to review its copy. According to many of them, in fact, with the proposal for a regulation put on the table by the institution with a view to capping gas prices, the European Union (EU) was going straight into the wall.

not far enough

The Commission had nevertheless put its heart into the work. Just before the emergency meeting of the “Energy Council”, on Tuesday November 22, it had unveiled a mechanism aimed at capping for one year the prices of monthly contracts on the reference gas market “TTF” (for “Title transfer facility”) ) – as soon as they exceed €275/MWh for two consecutive weeks.

But this double conditionality did not convince the Member States. “A significant number of countries, including France, said this proposal did not go far enough to protect businesses and industries”traces a source in the office of the French Minister for Energy Transition, Agnès Pannier-Runacher.

Other measures postponed

Result: to show their dissatisfaction, the States preferred to postpone the adoption of other measures put on the table by the European Commission to deal with soaring energy prices. However, this emergency meeting had indeed been convened by the Czech Presidency of the Council of the EU (in charge until the end of the year) to reach an agreement. The text provided for group purchases of gas (in which consortia of companies can voluntarily participate), a solidarity mechanism for countries threatened with shortages, and another proposal simplifying authorizations for renewable energy infrastructures.

A “joke”

European Commissioner for Energy Kadri Simson admitted that this “Energy Council was not easy”. Against the wall, the European Commission will have to present, very probably next week, a new proposal – “more realistic” as several sources say – to cap gas prices, before a new meeting of the “Energy Council” scheduled, probably, for Tuesday 13 December.

“At this level, it’s not a ceiling! Gas prices are threatening households and businesses, we have wasted too much time without results”, annoyed the Greek Minister Kostas Skrekas. His Polish counterpart Anna Moskwa denounced a “joke” from the Commission, while calling for a new proposal “in the next few days”.

Risk of endangering the security of supply

“I think the expectations of ministers can be very different. My role is to take these points of view into account,” continued Estonian Commissioner Kadri Simson. “Security of supply is a major concern”. In the eyes of the European executive, a ceiling that is too low – below the 275 €/MWh mark – could be harmful for the EU economy, if the mechanism is activated and the transactions are effectively blocked. For the Commission, reducing the volatility of the European gas markets is yes, but there is no question of playing sorcerer’s apprentice and endangering the security of supply.

If these various files remain deadlocked, the 27 EU leaders, who will meet for a European Council in Brussels on December 15 and 16, could have to take over. But Prague does not want to come to that and hopes that the conditions for an agreement between ministers on the various texts on the table can be met before mid-December.

Source : BBN NEWS

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