With a view to the European summit on 23 and 24 April in Cyprus, the European Commission is drawing up an ‘AccelerateEU’ action plan to ensure that the European Union is in a position to cope with the surge in energy prices caused by the war in the Middle East, to protect – in a targeted and temporary way – the households and businesses most affected, and to facilitate the transition to a European energy system that is less dependent on imported fossil fuels.
According to a provisional version, of which Agence Europe has received a copy, this action plan provides for immediate actions, the benefits of which enable a response to the emergency or will be felt in the longer term.
As far as short-term measures are concerned, the European Commission is reiterating that public support for consumers and businesses directly affected by soaring prices must be “targeted, temporary and timely” in order to limit the negative impact on public finances, which are often in a precarious state. In line with the ‘Citizen Energy’ package (see EUROPE 13825/2), a number of measures are possible: energy vouchers; aid to reduce consumption and/or replace boilers; lower indirect taxation, etc.
At a time when the European Parliament is increasingly calling for the taxation of surplus profits made by certain energy companies as a result of the war (see EUROPE 13845/4), the European Commission is cautiously indicating that it will analyse national measures aimed at taxing windfall profits, without going into the details of a European tax. It will also propose a revision of the European framework governing State aid (see other news).
The European Commission also reiterates the importance of actions to reduce fossil fuel consumption and accelerate the energy transition of economic operators. It announces the presentation of a catalogue of measures for the informal meeting of energy ministers on 13 May in Cyprus.
With regard to international energy markets, the EU institution advocates greater coordination of national actions on gas storage and the additional release of oil stocks.
Specific initiatives could concern kerosene, 40% of which is imported into the EU (with 20% transiting through the Gulf States) at a time when airports are warning of a possible shortage. European refining capacity will be mapped to optimise its use.
New European target for electricity storage. In terms of immediate action to deliver lasting benefits, the European Commission is detailing a series of measures outlined by its President earlier this week (see EUROPE 13847/3), including a massive expansion of electricity storage capacity by 2030, from the current 55 GW.
An action plan for electrification will be presented before the summer, setting an ambitious target and tackling the obstacles in the industry, transport and construction sectors.
“By electrifying half of its economy”, Europe could considerably reduce its dependence on fossil fuels by 2040, the EU institution points out in its provisional plan. It urges the European legislator to reach an agreement on the ‘network package’ by July (see EUROPE 13829/13).
In May, legislative proposals on network charges and taxation will be presented to reduce costs for all consumers and facilitate the transition to a more electrified and efficient energy system (Annex IV).
Finally, while investment needs amount to around €660 billion per year up to 2030, the European Commission will help Member States to reallocate existing European funding (RRF Facility, Cohesion Fund, revenue from the ETS) towards quick-impact energy investments.
Reduced energy consumption and use of renewable energies. As an annex to the communication due out on Wednesday 22 April, the Commission plans to present a series of indicators and factors promoting energy independence and decarbonisation.
In particular, it could suggest quantitative targets for reducing dependence on gas and oil by 2030 in sectors that are not difficult to decarbonise, such as district heating from renewable energy sources. The same goes for stimulating the deployment of biomass and heat pumps. The draft action plan also suggests ways of reducing the electricity/gas and electricity/oil price ratios.
It should be noted that the provisional document is also based on national best practice that the European Commission wishes to disseminate (Appendix II).
Read the Commission’s draft communication: https://aeur.eu/f/lk7 (Original version in French by Mathieu Bion and Solenn Paulic)