The Action Plan for Affordable Energy, which accompanies the Clean Industrial Deal presented by the European Commission on 26 February, is intended to relieve the energy bills of European consumers and industries, which currently face prices two to three times higher than those of their American and Chinese competitors, by enabling them to save annually up to a total of €260 billion between now and 2040.
The Commission calculates overall savings of €45 billion in 2025, rising gradually to €130 billion in annual savings in 2030 before reaching €260 billion in 2040, as the EU’s fossil fuel import bill falls and the Union bases its economy more on clean energy, electrification and energy efficiency.
Still dependent on American LNG. Nevertheless, the continent remains dependent on imports of liquefied natural gas (LNG), particularly from the United States, and the Commission is planning to sign long-term contracts such as gas liquefaction rights or purchase options, which have been criticised by government NGOs (see EUROPE 13587/20). However, the European Commissioner for Energy, Dan Jørgensen, has once again confirmed his desire to pursue this path (see EUROPE 13584/9).
“We do have to acknowledge that gas is still a part of our energy mix and it will be for some time into the future. And while we are in the process of, at the same time getting rid of the dependency on Russia, we do need to look at other alternatives”, the Commissioner explained to the media.
In particular, he stressed the need to diversify LNG suppliers, but acknowledged that there were only a limited number on the market. “The United States is certainly one of them. Just as we have been dependent on Norway for pipeline gas, we have certainly also been dependent on LNG from the United States, and will continue to be so in the future. Qatar is also playing a role”, he explained.
Transparency on gas markets. In order to obtain a better price for imported natural gas, Mr Jørgensen supported the need to explore demand aggregation options for EU companies, but also to draw inspiration from the “Japanese model”, mentioned in the text, of financing LNG export infrastructure projects abroad.
He also emphasised the Commission’s desire to ensure the smooth operation of the gas markets, without intervention, by not proposing a new price cap mechanism (see EUROPE 13570/24) - but by improving transparency and monitoring, in particular via a new ‘Gas Market Task Force’.
Energy taxation. As well as ensuring that gas markets function properly, the Action Plan emphasises, among other things, the need for Member States to take action on three components of the energy bill: network and system costs, taxation and supply costs.
“If you want to boost your industry in your country by lowering the bills, and you think that many of the structural changes that we are introducing take too long, you can act on this tomorrow, if you wish”, he addressed European governments.
In particular, the Commission will present a recommendation and guidelines on the harmonised design of tariff methodologies for network charges and, depending on their effectiveness, will propose new legislation.
It is also encouraging the Member States to reach a conclusion on the Energy Taxation Directive (see EUROPE 13564/11), “which allows decreasing taxes down to zero for energy consumed by households and energy intensive industries”.
Long-term contracts. For the Commission, this plan is also an opportunity to implement and accelerate the provisions of the latest electricity market reform (see EUROPE 13560/27) aimed at decoupling electricity bills from price volatility by encouraging the adoption of long-term electricity supply contracts.
With the European Investment Bank (EIB), it has launched a pilot programme for power purchase agreements (PPAs) for businesses, for an indicative amount of €500 million, and will provide guidance to Member States on the design of effective contracts for difference (CfDs), including their combination with PPAs, by the end of the year.
Permitting. The Commission is also asking the Member States to speed up the procedures for granting permits. It will present legislative proposals along these lines for networks, storage and renewable energies, as part of the future European package for electricity networks, expected in early 2026.
Other measures concerning safety, electrification and flexibility had already been unveiled in a provisional version of the Action Plan (see EUROPE 13582/2).
The final document: https://aeur.eu/f/fo3 (Original version in French by Pauline Denys)