The Commission is preparing to propose radical changes to the electricity pricing system. The talks are taking place as gas and electricity prices hit unreal levels and Europeans face a nightmare winter.
In urgent intervention for its comprehensive reform energy market is preparing to move on European Union. The news was given in dramatic tones on Monday by the president of the Commission, while an extraordinary meeting of the European Ministers of Energy next Friday has already been launched.
At the same time, European Commission President Ursula von der Leyen said later in the day that the full reform of the European electricity market should be done properly and, from a technical point of view, early next year.
Speaking at a panel in Berlin with German Economy Minister Robert Habeck, von der Leyen also said the electricity market must be reformed and the price of gas and electricity decoupled.
The talks come as gas and electricity prices hit unreal levels and Europeans face a nightmare winter.
Wholesale electricity prices in Greece will “climb” to 671 euros per megawatt hour tomorrow, while in France it will reach 744 euros and in Germany 660 euros.
We at the Commission are working on an emergency intervention and a structural reform of the electricity market. We need a new market model for electricity that actually works and rebalancesshe said characteristically.
Commission technocrats are looking for a solution to end Moscow’s gas blackmail, and energy ministers at an emergency meeting on September 9 will seek to take the first step.
“The era of Russian fossil fuels in Europe is coming to an end. And free from blackmail we will have more power to defend global rules. This should be our next strategic approach,” von der Leyen said.
“Russia is not winning the energy battle. It will be forced to burn more and more natural gas in the coming months, as the country’s storages are full,” stressed the head of the International Energy Agency, Fatih Birol.
Europe is facing the worst energy crisis in its history and Shell’s chief executive warns that the nightmare will not end easily
“That it’s going to be easy or it’s going to be over, I think is a fantasy that we should forget,” Shell CEO Ben Van Beurden noted.
Natural gas prices fluctuated sharply today, with a daily high of 307 euros and a low of 268 euros in the wake of news that German tanks are 82% full and pending European intervention. Wholesale electricity prices at the same time broke all records, even surpassing 1,000 euros per megawatt hour in Germany for the 2023 contracts, as it already did last week in France.
The energy crisis is testing the mettle of household and business governments across Europe, with Germany perhaps worst off. Even in Norway, where energy dependence on Moscow is comparatively limited, there are no shortage of problems.
Currently our gas reserves are at 67.9%. This is ten units below the normal limits we see in Norway, so it is a difficult situation but the chance of having a rationing or cutting supply is small. We have good connections to Europe in terms of importing electricity when needed, so we don’t think it will be necessary to ratio this winter. But the situation we are in with electricity is difficult, says Norway’s Energy Secretary, Andreas Vgeland Eriksen.
In addition to the battle of prices, Europe will have to win the battle of adequacy.
La Repubblica: Berlin ready to discuss gas cap proposal
According to the Italian newspaper La Repubblica, the German government appears to be changing its stance on imposing a maximum price on natural gas. “Tempered optimism in his government Mario Draghi. Something is moving in Berlin and, as far as the ceiling on the price of natural gas is concerned, there is a substantial, positive mood,” writes the Rome newspaper, in its online edition.
He adds that “the message reached the government building in Rome, the Palazzo Chizzi, from the Chancellery and it should find confirmation, of course, in the phase of taking comparative decisions”.
La Repubblica underlines, finally, that “everything will be verified on September 9, at the extraordinary meeting of the European Union’s energy ministers”.
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