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Thursday, Dec 08, 2022

Commission proposes new emergency package on energy prices

Commission proposes new emergency package on energy prices

The Commission also wants to develop a new gas trading benchmark for liquefied natural gas.
The EU wants countries to better coordinate their gas purchases and be subject to new rules on sharing gas supplies in an emergency.

"We've been working very hard in the last month against the fallout of the energy markets, and we have made progress," Commission President Ursula von der Leyen said at a press conference today to present the emergency package to deal with sky-high energy prices.

"On this basis, we can now take further steps towards a real Energy Union ... we want to be better prepared for the next filling season."

The package aims to bolster the EU's joint gas purchasing by asking countries to aggregate roughly 15 percent of their gas demand for next year. EU countries could then negotiate gas deals jointly with third parties through a consortium and avoid competition for gas between capitals, von der Leyen said.

The Commission also wants to develop a new gas trading benchmark for liquefied natural gas before April 2023.

Until the new benchmark is ready, the Commission has proposed implementing a "market correction mechanism" for transactions on the current Dutch TTF hub during "episodes of extreme prices." Such a measure will be presented as part of a later proposal, von der Leyen said.

The Commission also wants to bring in "default rules on solidarity" that would apply when critical gas-fired power plants or households risk severe shortages. EU countries would have 12 hours to respond to a solidarity request from another country and three days to fulfil it in exchange for adequate compensation.

EU leaders are slated to discuss the measures at a European Council summit that begins Thursday.
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