The EC will present a plan for capping energy prices in mid-September

The EC will present a plan for capping energy prices in mid-September
The EC will present a plan for capping energy prices in mid-September

Brussels – The European Commission is considering the possibilities of capping energy prices or other steps to limit the record high prices of gas and electricity. MEPs were told this today by Mechthild Wörsdörfer, deputy head of the European Commission’s Directorate for Energy, according to which Commission President Ursula von der Leyen will present a plan for a possible course of action on September 14. In addition to short-term measures, Brussels is also dealing with a possible reform of the energy market, she added.

This year, the member countries of the European Union commissioned the commission to prepare an analysis of possible price ceilings and long-term market reform due to the unprecedented rise in energy prices related to the Russian invasion of Ukraine. In recent weeks, more and more member countries are calling for a joint, accelerated solution.

“We are quickly considering all options and want to get feedback from the member states,” declared Wörsdörfer, referring to the extraordinary meeting of energy ministers called by the Czech EU presidency for next Friday. On it, the commission wants to hear the opinions of all countries on the possible setting of maximum prices. Five days after this meeting, the head of the EU executive is to present a possible joint course of action.

According to the mentioned EC official, for example, Brussels can propose different price ceilings for the import of gas from Russia or for its sale within the EU. The key goal for the commission is to protect not only the most vulnerable part of the population, but also the middle class and companies from the impact of expensive energy, she added.

Spain and Portugal have already resorted to capping gas prices, which within the European bloc have negotiated an exception allowing for the separation of interconnected gas and electricity prices. The governments of most EU states, including the Czech Republic, are talking about similar price restrictions at the level of the entire twenty-seven. According to experts, a unified system would make the functioning of price ceilings more efficient and prevent, for example, gas subsidized by public money in one country from being purchased by neighboring states.

Another way to help people struggling with expensive energy is to tax the extraordinary profits of companies in the industry. Italy, Spain and Greece, for example, have already started this, and governments in Germany and the Czech Republic are also considering it. The Commission does not talk much about this possibility, Wörsdörfer, on the other hand, today told MPs from the Committee on Industry and Energy that a plan for savings and reduction of energy demand can be part of a pan-European solution. A number of member countries also count on this and encourage their residents and companies, for example, to reduce the heating of buildings.

There is also a growing number of states that advocate the possibility of a broader reform of the energy market, which would include, for example, the aforementioned separation of gas and electricity prices, which is also increasing due to expensive gas affected by the uncertainty of supplies from Russia. According to Wörsdörfer, the Commission is currently analyzing the possible effects of this reform. However, the official did not specify when Brussels will present her proposal.

Citing an EC document, Reuters reported today that proposals to tackle expensive energy could include a price cap on some non-gas-based electricity generation technologies. According to the document, this measure would apply, for example, to wind, solar and nuclear power plants, which have lower operating costs than gas plants.

“This report represents the first package of measures to optimize the functioning of European electricity markets and to reduce the impact of gas prices on the prices paid by consumers,” Reuters quotes from the document. According to the document, the desired effect can only be achieved by a combination of measures, which would include reducing the demand for electricity, introducing a price cap and taking steps to protect consumers from rising energy costs.

EU EC energy gas

The article is in Czech

Tags: present plan capping energy prices midSeptember

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