Energy, EU summit agreement on dynamic price cap

Von der Leyen: “We now have a very good roadmap”. Michel: “Strong signal to the markets, effects very soon”

The EU heads of state and government reached an agreement on the European Council conclusions on energy late at night in Brussels. In particular, the leaders call on the Commission and the Council to present “urgently concrete decisions” on a “temporary dynamic corridor” to limit “excessive” increases in gas prices “immediately”. From voluntary joint purchase of gasthe elimination of the factors that amplify price volatility through greater efforts to save energy.



Von der Leyen

“We now have a very good and very solid roadmap for working on energy prices.” EU leaders “gave us the strategic guidelines we wanted on the proposals presented last Tuesday. We will continue to work on them next Tuesday in the Energy Council,” said European Commission President Ursula von der Leyen. Now “we will work on a legislative proposal to make a market correction mechanism operational” that avoids excessive rises in gas prices, she concludes.

Michel

The European Council underway in Brussels “is central, because it has set a precise framework, without taboos” to “act together” with “strong determination” to achieve “three objectives: lowering energy prices,” guaranteeing security of supplies “and” reduce demand “, explained the President of the European Council Charles Michel. Now the Commission and the Energy Council “have the task of working” on the necessary measures. The mobilization of “national”, but also “European” means is envisaged to finance the necessary actions, in order to “protect the single market”, he concluded.

“I trust” that European citizens “will feel the effects” of the decisions taken by the European Council on energy very soon, because they send a “strong signal to the markets”, he then stressed. “We have to work hard now to implement the measures on the table,” she concluded.

Rutte

EU leaders agreed that the Commission will assess RePowerEu’s funding needs, taking into account that there are still “hundreds of billions” of euros unused in the Recovery and Resilience Facility. And the dynamic gas price ceiling should not remove LNG from European ports, said Dutch Prime Minister Mark Rutte, in Brussels.

We must, he said, “first of all use all the existing funds we have. There is a general agreement: hundreds of billions are still available in the RFF, in the multiannual financial framework, in RePowerEu. Secondly, assess what might be needed. later: obviously this has to be decided and could happen in the next few weeks. I want to be very specific: we are willing to accept that the Commission “assess the needs,” then if “additional funding needs” emerge we will evaluate the proposals. Now we are not taking any decision on what our opinion will be: there is so much money available “.

As for the dynamic and temporary price limit, “it is a tool that could be ready in the coming weeks. We really need to weigh all the pros and cons and ramifications. For example, it could also lead to a higher base price” or “surf gas quickly away from Europe, literally. Obviously we have to make sure we have everything under control: this is why we have entrusted the energy ministers to work on it “, concludes Rutte.

What’s in the deal

The European Council, it reads, “invites the Council and the Commission to urgently present concrete decisions on the following additional measures, as well as on the Commission’s proposals, after having assessed their impact in particular on existing contracts, including the non-impact on long-term contracts term, and taking into account different energy mixes and national circumstances: voluntary joint purchase of gasexcept for the binding aggregation of demand for a volume equal to 15% of the storage filling needs, according to national needs, and the acceleration of negotiations with reliable partners to seek mutually beneficial partnerships by exploiting the Union collective market the weight and full use of the EU energy platform, also open to the Western Balkans and the three associated Eastern partners “.

“A new complementary benchmark by early 2023 that more accurately reflects gas market conditions; a temporary dynamic price corridor on natural gas transactions to immediately limit episodes of excessive gas prices, taking into account safeguards referred to in Article 23 (2) of the draft Council Regulation proposed on 18 October 2022; a temporary EU framework to limit the price of gas in electricity generation, including a cost-benefit analysis, without changing the ‘order of merit, while at the same time preventing the increase in gas consumption, addressing the financial and distribution impacts and its impact on flows beyond the borders of the EU “.

And then: “Improvements in the functioning of energy markets to increase market transparency, alleviate liquidity stress and eliminate the factors that amplify the volatility of gas priceswhile ensuring the maintenance of financial stability; acceleration of the simplification of authorization procedures in order to accelerate the introduction of renewables and networks also with emergency measures on the basis of Article 122 of the TFEU; energy solidarity measures in the event of a disruption of gas supply at national, regional or EU level, in the absence of bilateral solidarity agreements “.

It’s still, “greater efforts to save energy; mobilize relevant instruments at national and EU level. At the same time, the immediate priority is to protect families and businesses, especially the most vulnerable in our societies. Maintaining the Union’s global competitiveness is also crucial. All relevant instruments at national and EU level should be mobilized to strengthen the resilience of our economies, while preserving Europe’s global competitiveness and maintaining a level playing field and the integrity of the single market. The European Council is committed to close coordination of policy responses. It underlines the importance of close coordination and common solutions at European level, where appropriate, and is committed to achieving our political goals in a united way. The Council will continue to closely monitor economic developments and is committed to further strengthening our coordination in order to provide a decisive and agile political response. “

Finally, the leaders call on the Commission to “speed up” work on the reform of the electricity market.



Source-www.adnkronos.com