Brussels will monitor the rise in electricity market prices

Brussels will monitor the rise in electricity market prices

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Brussels will monitor the rise in electricity market prices

The escalation of energy prices in Spain is gradually becoming a problem in the four corners of the continent whose ramifications reach Brussels. Although the European Commission rules out acting for the time being, it does consider that this is a matter that at the community level requires careful monitoring. Brussels monitors fluctuations in the energy market in the EU to try to see if we are facing a temporary or long-term phenomenon that requires action on its part. The Community Executive has also assured that it will “study” the recent mechanisms introduced by the Spanish Government to lower the electricity bill.

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“Government [de Pedro Sánchez] has announced a series of measures to address the issue, “said the Commission’s first executive vice president, Frans Timmermans, in a meeting with various Spanish media in the European Parliament, reported by Efe. “We will study these measures,” added the commissioner who has led the Brussels proposal for the so-called Green Pact. Timmermans distinguished between the measures of the Spanish Executive between those aimed at “attenuating the fluctuation of the market” and others that propose to reconsider “the structure of the market itself”, such as “intervening in the profits of the companies”. Regarding these latest actions, he argued that these are “much more fundamental issues” that must be studied.

The debate comes at an uncomfortable moment, about to begin the negotiation between the European Parliament and the Council of the ambitious green package with which the community bloc intends to reduce CO₂ emissions by 55% by 2030 and achieve the total decarbonisation of the economy of the community bloc in 2050. The price of energy has become one of those issues that have flown over the hemicycle, corridors and halls of the Strasbourg Parliament during this week of plenary session, in which the President of the Commission Ursula von der Leyen delivered the State of the Union address.

On Tuesday, in Timmermans’ first face-to-face with MEPs on account of the Green Pact, the European Commissioner already acknowledged his concern about the rise in prices and the effect it may have as a brake on the environmental initiatives promoted by the Community Executive . “We cannot allow the social part to oppose the climate part,” he said. “I see this threat very clearly now that we have a discussion about escalating prices in the energy sector.”

Timmermans assured that only a fifth of the increase in energy can be attributed to the increase in CO₂ emission rights, while the rest is a consequence “of the scarcity of the market.” The Dutchman acknowledged that many of the measures to combat climate change will also have an effect on the price, although in the long run it will result in lower prices for final consumers. “Throughout this energy price crisis, we have seen that the prices of renewables have remained low and stable. So instead of being paralyzed, “he said,” we should accelerate the transition to renewable energy, to make it accessible to all. ” He also advocated for an equitable sharing of the burdens of this transition in society.

Although the President of the Commission, Ursula von der Leyen, omitted the matter this Wednesday in her State of the Union speech, the EU High Representative for Foreign Policy, Josep Borrell, did refer to it in an interview with the same day to RNE. The debate on the electricity pricing system, he said, has not yet broken into the Commission. “But it will open,” he predicted. In his opinion, little by little the rise in the bill will be noticed in the rest of the European countries, making the discussion inevitable.

The Commission defends the current system

“In Spain we have been among the first to notice the impact,” he added, “because we have a system where it is invoiced at the price of each day and therefore the price increases we notice immediately”. On the other hand, “in most European countries the contracts are at an annual fixed price and therefore they will not notice it until the end of the year,” he explained. The head of European diplomacy advocated reviewing “the electricity pricing system” because “at the end of the day there is a community regulation” on pricing “and sooner or later Europe will have to say something”.

In July, the Minister of Ecological Transition, Teresa Ribera, sent a letter to Timmermans in which she demanded a change in the European energy market. “If we want to ensure the success of the transition, we must rethink the design of the energy market,” he claimed. The objective, according to the letter: “That they not only ensure an efficient allocation of resources and the generation of adequate price signals; but also, and very especially, a fair and equitable distribution of the benefits associated with the transformation of the mix generation ”. Asked in the European Parliament about this letter, Timmermans told the Spanish press that they would study it: “We will see what the consequences of what she is asking could be. [Ribera] or what the Spanish Government has done and proposed ”, according to Efe.

The Commission, in any case, has not modified its official position, assert from the Community Executive. Since the summer, Brussels has responded to this issue with almost identical arguments, refractory in tone, defending the current European energy market. “The high prices are derived from a combination of factors, largely caused by the significant global demand for gas, higher prices of emission rights, combined with high seasonal demands caused by the economic recovery and weather conditions,” he said. a community spokesperson during an intervention in August, to which they refer from the Commission’s press team. That, broadly speaking, is the official position of Brussels: “The Commission has promoted an integrated energy market that tries to ensure that the energy that flows to the EU is as profitable as possible.” In the Commission they are not willing to open “a debate with anyone about the current state of the energy market” or about their “ambitious energy policy”. At least for now.