«Gas storage facilities in Europe are 92%. Russia’s share of pipeline gas has dropped to 9%, 2/3 of Russian supplies have been cut. Thanks to all this we are prepared to face the winter ». This was stated by the president of the EU Commission, Ursula von der Leyen, at a press conference in Strasbourg.
“We can now tackle excessive and volatile prices with greater confidence. We will introduce a temporary mechanism to limit excessive prices this winter, as we develop a new benchmark so that LNG is traded at a fairer price, “added the president of the Commission, explaining that with the legal tools for the joint purchase of gas “we guarantee solidarity in security of supply for all Member States and we negotiate with our reliable gas suppliers to guarantee gas at affordable prices”.
First step towards the price cap?
“We had considered the option of limiting the price of gas in our March communication. The proposal was then met with considerable skepticism. But the discussions in recent months have led to an understanding that is now more widely shared, ”explained Ursula von der Leyen. “I am therefore confident that we can now make progress on this crucial issue. We are taking a two-step approach. Today we have established a set of principles for this flexible roof mechanism, ”she explained. “It should be flexible enough to ensure security of supply and keep gas consumption under control and high enough to keep the market functioning and therefore the gas flow, and large enough to be linked to other benchmarks.” “As soon as the Council agrees on the principles, we will present the detailed measure to make it operational,” she added.
“The next winters will be hard”
For his part, number 2 of the Commission Frans Timmermans stresses that “the coming winters will be harsh, but today’s package helps to keep European families warm and to keep the industry running. The proposed measures mean that with the tools to buy gas together there will be no race for the highest offers ». The Commissioner for Financial Services, on the other hand, confirmed that the measures for energy operators and energy derivatives markets, targeted and limited in time, “focus on easing the liquidity stress that some energy companies have had to face to meet the their margin requirements and on dealing with the extreme volatility of prices on the markets ».
the Spanish model
‘The Commission will develop with Member States ways to limit the impact of high gas prices on electricity prices. The introduction of a price limit for gas used for electricity generation has reduced prices in Spain and Portugal “, therefore” deserves to be considered for the introduction at EU level, if it is possible to address in satisfactorily some open questions “. This is what is stated in the communication adopted by the European Commission to combat the energy crisis. “The EU member states are different when it comes to energy mixes, connections and power systems,” it continues. “It is necessary to design a solution that works for all of them and that prevents the increase in gas consumption, addresses the different financial impact between Member States and manages flows beyond the borders of the EU”, underlined the European Commission.