Sun, 17 Oct 2021

The EC will design a "toolbox" of measures, that Member States can implement to respond to latest energy price spikes without breaching the Union's market rules, as consumers face a sharp rise in bills with winter approaching. The power prices in EU have accelerated this year, more than trebling in Spain and elsewhere, mainly fuelled by the rising price of natural gas used for power generation and heating, Reuters reported.

The latter came on top of low renewable energy output and higher EU carbon prices.

Energy Commissioner Kadri Simson confirmed Brussels would produce guidelines to help countries tackle the price spike in the coming weeks. "I proposed to the ministers today to draw up a more structured toolbox, which we believe could be useful for all member states to tackle the current situation," Simson said, following a meeting of energy ministers from EU countries.

The toolbox is expected to governments navigate options to respond quickly to price spikes within EU rules, Simson said, noting they can tweak value-added tax (VAT) and excise duties or use direct support to shield consumers from high costs.

Benchmark European gas prices have risen by more than 250% since January, spiking as economies around the world reopened from Covid-19 slowdowns, with high demand in Asia pushing down supplies to Europe. It has sent shockwaves through gas-reliant industries, which include everything from power generation to makers of CO2 used in the food trade.

Spain has initiated calls for the EU to organise a more coordinated response to the price spikes. On Monday, it asked the Commission to provide options for how EU states could respond, and suggested reforming the bloc's electricity market. Simson said the design of Europe's electricity market had not contributed to the price increases, and that wholesale power prices made up only a third of consumers' bills, with taxes and other elements making up the rest. Spain, Italy, Greece and others are already planning national measures, ranging from subsidies to price caps, aiming to shield citizens from rising costs as economies recover from the Covid-19 pandemic. Germany said it did not see a need for government intervention to counter rising gas prices.

"We need to make decisive steps in the right direction by using our own locally available resources - we need to decrease our dependency on fossil fuels," said Slovenian infrastructure minister Jernej Vrtovec, who led the ministerial meeting. Austrian climate and energy minister Leonore Gewessler said a faster shift to renewables would make the EU "more resilient to price fluctuations in the long term."/Europost

Copyright (c) Novinite.com. Published with permission via Big News Network news agency

More Spain News

Access More

Sign up for Spain News

a daily newsletter full of things to discuss over drinks.and the great thing is that it's on the house!