EU energy ministers agreed during their Friday meeting on four main areas for temporary emergency measures to alleviate the growing energy crisis in the bloc, Kallanish notes. These include a price cap on gas. They have asked the European Commission for a proposal “in days”, said Jozef Síkela, industry and trade minister of the Czech Republic, which currently holds the EU presidency.
The remaining areas are capping the revenues of electricity producers that face low production costs; measures for a coordinated electricity demand reduction across the EU; and measures that would help to solve the issue of decreased liquidity.
Ministers also discussed possible options on how to make use of the EU ETS in addressing current high electricity prices. They also looked to advance negotiations and find a solution on the Market Stability Reserve in the context of the REPowerEU initiative.
Further work is also being encouraged on the voluntary EU Energy Platform on gas, LNG and hydrogen, in order to secure the EU’s energy supply at affordable prices.
Ministers have asked to swiftly examine, still in September, any proposals to be tabled by the Commission. The latter has been asked to present an extended and broadened scope of the Temporary Crisis Framework at least until 31 December 2023.
The energy situation has considerably worsened over the last weeks, with the EU now experiencing tight electricity markets, predominantly due to the impact of Russia’s war against Ukraine and related gas supply disruptions.
Electricity generation capacity in the EU has also been significantly lower than usual in the last months due mainly to the shortfall of nuclear power and hydropower. This is threatening the competitiveness of European companies and creating social tensions, according to the EU presidency summary of the meeting.
Despite recent developments, and in particular the cut-off of Russian gas flows via Nordstream I, Europe is prepared for this winter. EU underground gas reserves have been filled by 82.5% of their capacity, well ahead of the 1 November deadline set in the gas storage regulation.
Steelmakers association Eurofer said on Friday that immediate measures are required from EU policymakers to prevent the destruction of Europe’s industrial base, which “go beyond the EU’s usual rule book”. Spiralling gas and energy costs, coupled with non-EU producers exploiting the situation by supplying to Europe at low prices are resulting in plant closures, production curtailments and layoff programmes, it added.
Adam Smith Poland