EU Plan To Reduce Gas Consumption To Be Released Tomorrow

Reuters has reported that the EU Commission plans to make EU gas consumption targets, within the "save gas for a safe winter" package, legally binding in supply emergency.

• The EU Commission has devised the plan based upon the assumption that European gas supplies will be subject to disruptions from Russia.
• Reuters Climate and Energy Correspondent Kate Abnett writes that a draft of the plan will propose voluntary targets for all EU countries to cut gas demand from August to March 2023.
• Abnett states that the proposal "would also enable the Commission to make the target legally binding, if Europe's gas supply situation deteriorates to a point where emergencies are likely, or two countries ask the EU to declare a gas supply emergency."
• The draft proposal does not state specific demand targets but targets are expected to be based upon a countries average usage over a 5-year period.
• The draft statement reads: "The EU is now in a vulnerable gas security of supply situation. The time has come for the EU to anticipate risks and proactively step up gas security of supply preparedness."
• According to Reuters, the EU predicts in the draft document that a full disruption of Russian gas supply, combined with a cold winter, could cut EU GDP by 0.9-1.5% if adequate contingencies are not in place.