London Daily

Focus on the big picture.
Sunday, Jun 28, 2026

Soaring energy costs trigger radical market shake-up in Brussels

Soaring energy costs trigger radical market shake-up in Brussels

Von der Leyen wants to rip up electricity markets and raise cash from power firms to help consumers.

Energy companies will be hit with a cap on profits to raise €140 billion to help struggling consumers with rocketing bills, under plans for a sweeping overhaul of EU power markets that are “no longer fit for purpose,” Ursula von der Leyen said on Wednesday.

In an annual State of the Union speech dominated by the war in Ukraine — the European Commission president even wore an outfit to match the country’s blue and yellow flag — von der Leyen promised “comprehensive reform” of the bloc’s electricity market, and a new task force to examine how to cap the price of gas.

Those are calls the EU leader has made before, but there’s a growing sense that keeping energy prices down is key to the EU’s long-term ability to continue supporting Ukraine in its existential fight with Russia.

Von der Leyen also suggested rewriting the European Union’s founding treaties to shake up the way the bloc’s leaders make decisions, an idea bound to cause arguments, especially in countries like Poland, where the effort will be seen as a Brussels bid to impose rules on the nationalist government.

Von der Leyen’s blueprint is designed to help the EU weather the storm of rocketing inflation, runaway power prices and a war on its borders that she said is putting the future of democracy at risk.

“We will be tested — tested by those who want to exploit any kind of division between us,” von der Leyen told members of the European Parliament in Strasbourg. The bloc is facing not just a security threat from Russia’s invasion of Ukraine, but a broader war, she said.

“It is a war on our energy. It is a war on our economy. It’s a war on our values. It’s a war on our future,” she said. “It is about autocracy against democracy and I stand here with the conviction that with the necessary courage and with the necessary solidarity Putin will fail and Ukraine and Europe will prevail.”

The wide-ranging annual address is a chance for the Commission president to set out her legislative and political priorities for the year ahead. This time, there was one big preoccupation: how to respond to the crisis triggered by Russia’s invasion of Ukraine.

First, von der Leyen offered deeper economic support for Ukraine itself. While she stopped short of major new pledges on funding supplies of weapons or hitting Russia with more sanctions, she said she would work to open up the EU’s single market to give Ukraine “seamless access.”

“Today, I am going to Kyiv to discuss all this with President Zelenskyy,” she said, as the Ukrainian leader’s wife Olena Zelenska listened as a guest of honor in the Parliament chamber.

The most urgent part of von der Leyen’s address focused on the energy crisis now gripping the EU. The electricity market is “not fit for purpose anymore,” she said.

Von der Leyen said the bloc must decouple gas prices from the cost of electricity — currently, the EU’s pricing structure ties all power costs to the price of gas, a move meant to encourage more sustainable energy use.

Ukraine’s first lady Olena Zelenska listened as a guest of honor in the Parliament chamber


But after the war threw the energy market into disarray, countries like Spain started calling for the EU to decouple the link between gas and electricity pricing. Until this summer, though, the idea was given short shrift from Brussels.

“Consumers should reap the benefits of lower-cost renewables,” she said.

A levy on soaring profits for utilities generating power from low-cost sources and from fossil fuel companies will raise €140 billion to help families across the bloc who face impossibly high bills, she said.

“In these times it is wrong to receive extraordinary record profits benefitting from war and on the back of consumers,” she said.

The EU will continue cutting its reliance on Russian energy by relying on gas suppliers like Norway and the U.S. and beefing up its gas storage.

“Russia keeps on actively manipulating our energy market … This market is not functioning anymore,” she said.

Von der Leyen’s speech also included:

— A relief package for small family businesses, including rewriting late payment rules so firms don’t go bust because invoices have not been paid

— Backing for French President Emmanuel Macron’s plan for a European “Political Community”

— A Critical Raw Materials Act, to help the bloc develop an industry for minerals used in electric vehicle batteries, for example

— Plans to deepen ties with “like-minded partners,” especially aspiring EU members Ukraine, Moldova and Georgia

— A pledge to fight for democracy, taking on internal EU threats to rule of law standards. A new Defense of Democracy Act will be published

— A call for a new European Convention, a gathering that would mark a step toward changing the bloc’s founding treaties to overhaul decision-making.

Newsletter

Related Articles

0:00
0:00
Close
GB News Pundit Charged With Fraud Over Alleged Conduct as Former Labour Adviser
Reform UK Gains Parliamentary Visibility in First Senedd Opposition Appearance
Metropolitan Police Arrest Man on Suspicion of Attempted Murder After London Car Incident
Ocado Chief Executive Tim Steiner Faces Scrutiny Over £100 Million Remuneration Package
British Chambers of Commerce Downgrades UK Growth Outlook to 0.9 Percent for 2026
Nottingham University Hospitals Maternity Failings Trigger Renewed Calls for Public Inquiry
Severe Heatwave Disrupts UK Transport Networks and Strains Public Services Across England
Labour Leadership Transition Raises Prospect of Andy Burnham Becoming UK Prime Minister
UK Government Confirms Further Medicine Price Concessions for Community Pharmacies in June
British Chambers of Commerce Calls for Public Procurement Reform to Boost Regional Growth
Thousands Mark Armed Forces Day Across the United Kingdom With National Parades and Flypasts
Man Arrested in Ealing on Suspicion of Attempted Murder After Vehicle Ramming Incident Injures Five
Cambridge South Station Opens With £250 Million Investment to Strengthen Life Sciences Corridor
UK Heat-Health Alerts Extended Across England as High Temperatures Persist
Thames Water and Energy Operators Warn of Peak Demand Risks During UK Heatwave
Government Conference Highlights Push for Evidence-Led Policy Across UK Public Sector
Insolvency Service Reports Improved Confidence in UK Insolvency System
Security Industry Authority Finds Widespread Safety Failures in UK Night-Time Economy
Nigel Farage Expands Anti-WHO Campaign Into United States With New Lobbying Structure
Home Secretary Seema Mahmood Unveils New Safe Routes Plan for Asylum Seekers
UK Government Warns of Peak Electricity and Water Pressure Amid Ongoing Heatwave
New Nuclear Plant in Wales Named Gwyndod Power Station as Energy Strategy Advances
UK Announces First Major Hydropower Projects in Four Decades to Expand Renewable Capacity
Thirteen Men Charged in Major UK Sexual Abuse Case as Investigation Continues
UK Launches Cross-Sector Climate Security Taskforce Linking Environment and National Security
UN Secretary-General António Guterres Calls for Urgent Global Methane Emissions Cuts in London
World Bank Approves $1 Billion UK-Backed Financing Package for Ukraine Recovery
UK Pledges Emergency Aid and Rescue Team Deployment to Earthquake-Hit Venezuela
Bank of England Holds Interest Rates at 3.75 Percent for Fourth Straight Meeting
Record-Breaking Heatwave Puts Strain on UK Health Services and Energy Networks
London Ambulance Service Sees Record Emergency Demand as Heatwave Intensifies
British Chambers of Commerce Warns of Prolonged Weak Investment Climate Through 2027
Bank of England Holds Interest Rates as Inflation Risks Persist
UK Construction Sector Faces One Percent Contraction Amid Cost and Investment Pressures
Former DUP Leader Sir Jeffrey Donaldson Convicted of Sexual Offences
Church of England Appoints Dr Linsay Cunningham to Lead Faith and Public Life Division
UK Armed Forces Day Marked Nationwide With Events From Aberdeen to the Scilly Isles
Rising Tensions in Edinburgh Prompt Joint Warning From Scottish Local Government Leaders
UK Construction Sector Forecast to Contract One Percent in 2026 on Cost Pressures
UK Parliament Backs 87 Percent Emissions Cut as Government Deepens Electrification Drive
British Chambers of Commerce Forecast Weak UK Growth as Investment and Demand Slow
Bank of England Holds Interest Rates at 3.75 Percent Amid Energy and Inflation Uncertainty
London Ambulance Service Reports Record Surge in Life-Threatening Emergency Calls During Heatwave
UK Parliament Approves Legally Binding 87 Percent Emissions Cut Target by 2040
United Kingdom Records Third Consecutive Day of Record June Heat as Europe Faces Worsening Heatwave
Robert Jenrick Defends £5 Million Donation to Nigel Farage Amid Political Scrutiny
Plymouth Museum The Box Wins 2026 Art Fund Museum of the Year Award
UK Government Faces Backlash Over Plans to Use Former Military Sites for Asylum Accommodation
Labour Party Faces Pressure Over Cabinet Stability as Senior Figures Clash on Policy Direction
Heathrow Airport Forecasts Passenger Decline in 2026 as Costs and Climate Disruption Mount
×