Belgium, Poland, Italy and Greece sent a non-paper to the European Commission on Thursday 6 October setting out their arguments for the introduction of a dynamic price corridor applied to all wholesale fossil gas transactions.
This document was announced by the Polish Minister for Climate and Environment, Anna Moskwa, on Friday 30 September, at the end of the last extraordinary meeting of European Energy Ministers (see EUROPE 13033/2).
Calling for accelerated work on additional emergency measures to reduce energy prices, the latter had indeed expressed her intention to draft, in collaboration with other Member States, a proposal to establish a generalised cap on gas prices.
Their proposal is thus not limited to gas imports from specific jurisdictions or to a specific use of gas, says the document obtained by EUROPE.
According to these Member States, capping the price of gas imported from Russia alone has several weaknesses. In particular, they consider that such a measure would not have a positive impact on consumer prices, would be discriminatory and would have to be adopted under the procedure laid down for sanctions, i.e. by unanimity of the EU Member States.
They also criticise the option of targeting only gas used for electricity generation. This ignores gas used in industry and buildings (two-thirds of the EU gas market), creates an unlimited obligation on the price of imports and discourages price reductions, the four countries argue.
Detailing the proposal, the non-paper points out that the corridor should be appropriately high and flexible enough to: - not hinder the proper functioning of the market; - enable Europe to attract the gas supplies needed for its energy security from world markets; - make transactions over the corridor possible, if necessary; - preserve the incentive to save energy and/or switch to gas.
“It should act as a circuit breaker and disincentive to speculation. It is not meant to suppress prices at an artificially low level”, the text says, while recommending that it should also apply to long-term contracts priced according to existing key price indices.
While the Commission is currently working on an alternative index to the Dutch TTF, the four Member States call on the Commission not to wait for the end of this process, “which will take time”.
They also believe that a price corridor should be accompanied by “strengthened voluntary demand reduction measures”.
The issue of energy price mitigation will be discussed by the 27 Heads of State or Government of the Member States on Friday 7 October at an informal summit in Prague (see EUROPE 13036/2).
While the Commission has provided leaders with a roadmap outlining some options, the four countries’ non-paper demonstrates the impatience of some Member States.
According to our information, Germany remains categorically opposed to the idea of a generalised cap, even in the form of a price corridor. (Original version in French by Damien Genicot with Pascal Hansens)