Dispute over gas prices slows down EU emergency plans

It was already clear in the run-up to the emergency meeting that the gas price cap would be the major issue in Brussels. The fact that no tangible result could be presented on Thursday afternoon will probably cause widespread disappointment in many countries.

Energy Minister Leonore Gewessler (Greens) also said after the meeting: “There is nothing to sugarcoat: The results of today’s meeting fall short of expectations.” In principle, there was agreement on some measures, such as curbing speculation, the common Gas purchasing and faster approval processes. However, due to the wishes of some states, these are only to be decided when there is also the green light for a gas price cap.

The Austrian Environment Minister Leonore Gewessler (Greens)

Reuters/Johanna Geron

Energy Minister Gewessler was disappointed with the result

“The proposed measures would have helped us lower prices and strengthen our independence. Valuable weeks go by again when nothing happens,” Gewessler continued. Specifically, there should now be another special meeting of ministers on December 13 – and then everything will be decided and implemented together. That’s the theory.

Positions unchanged for months

Because in practice it is clear that the positions have actually been hardened for months. This was also evident in the run-up to this year’s meeting. The proposal for a cap presented at short notice by the EU Commission was sharply criticized by those countries that had previously called for much stricter measures.

A group of 15 countries, led mainly by Spain and France, consider the Commission’s proposal to be insufficient and do not believe that it can have the same effect. Polish Minister Anna Moskwa called this cap a “joke” even before the meeting. “The text that is on the table is unsatisfactory,” said Belgian Energy Minister Tinne Van der Straeten. The price cap proposal “does not go far enough to protect our businesses and our industry. The Commission will have to make new proposals,” said France’s Energy Minister Agnes Pannier-Runacher afterwards.

A second, smaller group, led by Germany, is generally critical of a lid. “In summary, one can say that everyone is somehow unhappy with the Commission’s proposal,” said the German State Secretary for Economic Affairs, Sven Giegold, at the start. So far, Austria has also been considered rather cautious and is calling for a different model, which the EU Commission wants to examine but has not yet presented. The skeptical states argue primarily with the security of supply, which they see endangered by a cap.

Report on the EU gas price cap debate

Benedict Feichtner (ORF) reports from Brussels on the disagreement in the debate about a European gas price cap.

A lid with many conditions

The fact that the Commission only put its proposal on the table two days before the meeting may also have made the situation more difficult. Specifically, they want a price cap for the Dutch trading venue TTF, which is particularly important for Europe. EUR 275 per megawatt hour was suggested as the upper limit, but only under certain conditions. The measure should only take effect if this value is exceeded for two weeks. And then only if the price per megawatt hour is 58 euros higher than the international price of liquid gas.

A worker in a gas holder in Saint-Illiers-la-Ville (France)

Reuters/Christian Hartman

The gas price cap proposed by the EU is subject to many conditions

In addition to the critical voices from politics, experts also gave devastating judgments. “The conditions that were proposed are formulated in such a way that they will probably never be met,” Christian Egenhofer from the Brussels think tank CEPS told ORF.at. “We’re probably talking more about a placebo,” says the expert.

Georg Zachmann from the Bruegel think tank meanwhile said in an interview that the cap proposed by the commission would “disappoint supporters and opponents alike”. However, Zachmann does not see Brussels as solely responsible for this: the Commission received an “impossible order” from the 27 EU states, they should have “invented a mechanism that lowers prices without the quantities becoming scarce”.

Last chance in December

With the many exceptions, the mechanism was supposed to come into force on January 1st. There is very little time for that now. Incidentally, the agreement does not have to be unanimous, so individual countries cannot block any gas price caps.

However, it is still unclear whether the necessary majority – 55 percent of the member states, which represent 65 percent of the EU population – will be achieved in December. Should white smoke rise in Brussels on December 13th, a solution could still be found by January. Because just two days later, the EU heads of state and government meet and could approve the proposal.

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