Energy ministers postpone decision on gas price ceiling to December | European Union

Energy ministers postpone decision on gas price ceiling to December | European Union
Energy ministers postpone decision on gas price ceiling to December | European Union

The ministers of energy of the European Union recalled, this Thursday, the old maxim that says that “nothing is approved until everything is approved”, recurring in Brussels, and postponed until the next 13th of December a decision on a new mechanism of correction of gas prices, which, as designed by the Commission, “will never be used”.

Dissatisfied with the European Commission’s proposal, which set the limit that triggers the mechanism automatically at 275 euros per Megawatt hour, a value that is more than double the current market price, the ministers refused to adopt two other regulations that are part of the package for an intervention in the gas market, which pave the way for the aggregation of demand and joint purchase of gas, and also for accelerating the licensing of renewable energy projects.

“We agreed and stabilized the legislative texts for accelerating licensing and joint gas purchase mechanisms, but no agreement was reached on the correction mechanism that has to do with maximum gas prices and the problem of the TTF index, and therefore the decision was that the three texts should be approved as a package, at the next Council scheduled for December 13”, said the Secretary of State for Energy, João Galamba, at the end of the meeting

The meeting three weeks from now will be the fifth time that the 27 energy ministers meet in an extraordinary way to agree on a common response to the energy crisis and rising prices. “I expect the EU Council to formally approve this package within a few weeks. Nobody has any doubts that these measures are urgent and necessary, taking into account the challenges we face in the gas markets”, observed the European Commissioner for Energy, Kadri Simson, the target of harsh criticism after presenting a proposal that, insisted several ministers, nobody likes it.

This Thursday, he defended his lady: “We respond to the mandate we received from the European Council, which asked us for a temporary measure to limit episodes of excessive prices, without compromising the security of supply, the intra-border flows of the EU, the objectives demand reduction and financial stability. That was the context in which we had to find a balance ”, she stressed.

But in the evaluation of many capitals, there is no equilibrium in the proposed model. “A bad joke”, was how the Spanish Minister of Ecological Transition, Teresa Ribera, described the Commission’s proposal, which “seems like it was designed to guarantee that it will never be applied”, she criticized. Spain, like Portugal, are part of a group of 15 Member States that pressured Brussels to move forward with a “dynamic ceiling” for the price of gas, with a premium on the quotation paid in other markets, namely the Asian one.

“This proposal is not suitable for Portugal”, considered the Secretary of State for Energy, who during the meeting argued against the “mixture” between high prices and the dysfunctionality of the TTF index “when compared to other indices, namely LNG (Hás Natural liquefied)”. “We understand that they are two independent and distinct themes”, said João Galamba.

On the opposite side, there are countries like Germany or the Netherlands, which once again warned of the risks of artificial intervention in the market to control prices. Dutch Minister for Climate and Energy Policy Rob Jetten confirmed that he too is “very critical” of the Commission’s proposal, “albeit from a very different point of view than my colleagues”. “This mechanism has flaws, it is a risk for the security of supply and for the stability of the financial markets”, he pointed out.

On behalf of the Czech presidency of the EU Council, the deputy prime minister in charge of Industry and Trade, Jozef Síkela, promised to “reflect” on Thursday’s discussion to present a new compromise version that can gather consensus of all. A difficult task, given the current divergences. “This was a first debate, which served as a starting point for us to reach an agreement in December”, he said.

The Secretary of State for Economic Affairs and Climate Action of Germany, Sven Giegold, has no doubt that a lot of stone will still have to be broken to approve the price correction mechanism. “It is obvious that this proposal will never pass as it stands because everyone is unhappy and this is not the kind of unhappiness that leads to compromises”, he summarized.

The article is in Portuguese

Tags: Energy ministers postpone decision gas price ceiling December European Union

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