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EU Remains Divided Over Energy Emergency Measures

ENERGY

EU leaders are set to endorse most of the bloc’s latest proposals announced by the EU Commission this week to tackle soaring energy prices. Leaders meet at their October 20-21 summit.

  • It includes plans to launch an alternative price benchmark for LNG and start joint gas buying - each proposal requires 65% of the bloc’s support.
  • A cap on EU gas prices remains elusive lacking support from key nations like Germany and the Netherlands – despite most countries in the EU being in favor. Brussels could draft another proposal to set a temporary price limit on the TTF Dutch gas hub subject to certain conditions.
  • Brussels is also set to examine a "temporary dynamic price corridor" on gas transactions as well as draft measures to "propose a temporary EU framework to cap the price of gas in electricity generation at a level that helps bring down electricity prices".
  • The cap on gas prices for power gen is known as the ‘Iberian Mechanism’ which is currently being used by Spain and Portugal but splitting broader EU support.
  • Ursula von der Leyen fell short of fully supporting the Iberian mechanism this morning, instead saying "It really merits to be considered at EU level. There are still questions to be answered but I want to leave no stone unturned,".

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