EU countries spent nine hours debating in Brussels on how to deal with high energy prices. In the evening, the heads of state and government agreed to jointly buy gas in the future. However, on a voluntary basis. “I am pleased that we will use our collective negotiating power,” Commission President Ursula von der Leyen said after the summit. “Instead of breaking through each other and raising prices, we’re going to combine our demand.”
For pipeline gas, the EU represents around 75 percent of the market, von der Leyen said. “We have tremendous purchasing power.” The summit declaration states that countries and the Commission should discuss with energy stakeholders whether and how, inter alia, price caps or tax breaks can help to lower the price of gas and combat its ‘contamination’ effect on electricity markets. At the same time, heads of state and government are asking the Commission for proposals to tackle the problem of high electricity prices, protect the integrity of the internal market and create incentives for the energy transition.
Update 22:00: Chancellor Karl Nehammer’s reaction
Nehammer insists on burden-sharing
Countries are already counting on a price advantage by jointly purchasing gas on a voluntary basis. According to the statement, the aim is to use the “common political and economic weight of the European Union” to lower prices in procurement negotiations. According to the Commission’s plans, its team could negotiate with suppliers with the support of Member States – similar to the joint purchase of corona vaccines. According to the statement, joint purchasing should also be open to Ukraine, Moldova and Georgia, and the countries of the Western Balkans.
Chancellor Karl Nehammer (ÖVP) welcomed the plans for joint gas purchases. “It’s good if we coordinate,” he said after the summit. At the same time, he called for “burden sharing” on gas storage. Compared to its population, Austria has the largest gas storage facilities in the EU. Therefore, solidarity is needed with regard to the European Commission’s requirement that Member States fill their warehouses to 90 percent by 1 November. The European Commission’s plan is “ambitious and understandable” but it cannot be done to the detriment of Austria. “We will also be happy to replenish stocks in the spirit of Europe, but it must also be clear that the costs will be shared in the spirit of Europe.”
Polish Prime Minister Mateusz Morawiecki said that countries such as Germany must be called on to quickly abandon gas and oil from Russia. Poland will present a suitable plan for its country next week. German Chancellor Olaf Scholz said that energy dependence on Russia is ending sooner than expected. “It will be much faster than some people might wish.” He did not mention the year.
Scholz and Macron do not want to pay in rubles
At the same time, Scholz rejected the call by Russian President Vladimir Putin to pay future gas bills in rubles. He said the contracts had been checked and it turned out that payments were made in euros or dollars. French President Emmanuel Macron made a similar statement. He said there was no reason to comply with the Russian request.
When it comes to purchasing gas, Scholz insisted on being voluntary. He noted that purchases in the EU are and will be made by many private companies. Germany and other countries are very skeptical about market interventions, emphasized Scholz.
Heads of State and Government have been discussing measures to combat high energy prices for several hours. The scope of intervention in the free market was controversial. Spain in particular opted for more extensive measures. For example, Madrid wanted to separate the price of electricity from the price of gas as both are linked by a price mechanism in the EU. The price ceiling was also discussed, which is supported by, inter alia, Spain, Greece, Italy and Portugal. Countries such as Germany and the Netherlands reject such market intervention.
Spanish Prime Minister Pedro Sanchez said after the summit that his country and Portugal would approve a temporary price cap on energy costs. According to Sanchez, these measures would not distort the European market. (apa)