The Council for Energy will deal with two proposals for possible solutions to energy prices

The Council for Energy will deal with two proposals for possible solutions to energy prices
The Council for Energy will deal with two proposals for possible solutions to energy prices

Prague – The Extraordinary European Council for Energy, which the Czech Republic as the presiding country convened for Friday in Brussels, will address two proposals for possible solutions to high energy prices. The Czechia, as the presiding country, is now ascertaining the opinions of the individual member countries on the given proposals, on Wednesday it wants to publish the so-called presiding summary, which summarizes the positions of the individual countries. The council will come up with a solution on Friday, Minister of Industry and Trade Jozef Síkela (for STAN) told journalists today.

According to Síkela, two proposals now stand against each other. One envisages separating the price of gas from the price of the final power plant, which determines electricity prices. “This means that the high gas prices, which are the subject of the energy war, do not affect electricity prices,” said Síkela. The second proposal wants to establish maximum prices for all other electricity productions except gas. At the same time, according to Síkela, the Czech Republic is continuing negotiations on solving the energy crisis at the national level.

“We have a consensus across the states that it is the right moment for the Czech Republic to convene the council and that we must take certain steps. There is complete agreement that we must liquidate those markets, that means we must provide traders with enough liquidity so that they can trade,” said Síkela. According to him, individual member states are already working on a solution, but a pan-European solution may also be on the table.

According to him, the separation of gas and electricity prices can have pitfalls in that it can lead to higher gas consumption. And in Europe, under certain conditions, there may be a shortage of gas, Síkela said. According to him, the second proposal does not motivate higher gas consumption.

Regardless of how the European negotiations turn out, the Czech Republic is also preparing its own solution. “I can confirm that negotiations are underway and measures are being prepared to ensure the stability of energy prices in the Czech Republic for all end users, both households, companies and the public sector,” Síkela said. According to him, the negotiations are at a very advanced stage and only the details are being resolved. The minister added that the measures would probably be individual for each sector.

The European Commission wants to present a proposal during the extraordinary council, the aim of which will be to cap the price of Russian gas transmitted by gas pipelines, limit the demand for electricity, help vulnerable consumers and companies and enable support for electricity producers who are facing financial problems. The mentioned points also appear in the list of potential measures that the Czech Presidency of the Council of the EU presents for discussion before the extraordinary meeting of the Union Ministers responsible for energy.

The price of electricity in Europe is determined on the stock exchange, for the Czech market the one in Leipzig plays a major role. An important role in the creation of prices for final consumers is played by the principle according to which the price of all electricity supplied at a certain time depends on the most expensive source currently being used. Currently, they are – due to the prices of the commodity used – gas power plants. For example, in the Czech Republic, gas power plants make up almost ten percent of the energy mix, while in the European Union, according to Eurostat data for 2020, their share reached almost 24 percent.

EU government energy Síkela

The article is in Czech

Tags: Council Energy deal proposals solutions energy prices

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