Energy prices soar and EU poses 'joint gas purchase'

We use your sign-up to provide content in ways you’ve consented to and to improve our understanding of you. This may include adverts from us and 3rd parties based on our understanding. You can unsubscribe at any time. More info

Mr Babis arrived at an EU summit in Brussels on Thursday where he challenged the bloc’s Emissions Trading System (ETS) and the impact, he thinks, it had on Europe’s rising energy prices. Europe has been caught in the grips of an energy crunch driven by dwindling gas supplies, increased demand for power post-pandemic and the lacklustre performance of renewable energy sources. The EU’s push for green and net zero has also contributed to the crisis, according to Mr Babis, and has been a point of contention for many member states.

The ETS has been branded a cornerstone of the EU’s policy to fight climate change and a “key tool” to drive down greenhouse emissions.

The scheme operates on a “cap and trade” principle that sets a cap on certain greenhouse gases while allowing member states to trade emissions allowances within the cap.

Member states that do not surrender enough allowances to cover their emissions face heavy fines from the EU.

However, the system that was adopted in July this year, has come under fire in recent weeks.

Earlier this month, officials from Hungary warned the system would cause “serious damage” to the bloc, fearing it would increase the cost of energy for consumers.

The concern was echoed by France’s Minister of Ecological Transition Barbara Pompili who told the EU’s environmental ministers: “There is risk that energy prices will rise without any clear impact on carbon emissions.”

The EU has so far refused to accept responsibility for the energy crunch, claiming the ETS has only contributed to the crisis in a very minor way.

The energy crunch was at the heart of the EU’s summit last night, with MEPs passionately debating the issue into the late-night hours.

Expert accuses Russia of blackmailing Europe over gas trade

According to Politico’s Brussels Playbook, Mr Babis got his way in the end when the EU agreed to ask the European Commission to investigate the ETS market with the aid of the European Securities and Markets Authority.

The Commission will have to determine whether “certain behaviours require further regulatory action”.

The summit also encouraged member states to make use of an emergency toolbox designed to alleviate the cost of rising energy prices in the short term.

These include tax breaks, direct payments and subsidies for small businesses.

The summit urged the European Commission and Council to investigate “medium and long-term measures” that would make energy prices more affordable for households and companies.

The EU said it also wants to “increase the resilience of the EU’s energy system and the internal energy market” as well as “provide security of supply and support the transition to climate neutrality, taking into account the diversity and specificity of situations of Member States”.

With no end to the crisis in sight, a growing number of EU member states have been voicing their problems with the EU’s green energy policies.

Nuclear power has emerged in recent weeks as a viable option that could help bolster the bloc’s energy sector, but the EU has strongly opposed branding nuclear “green”.

But the EU’s stance on nuclear may be due for a correction after European Commission President Ursula von Der Leyen addressed the issue at the summit yesterday.

She singled out nuclear as one of the few energy sources that is not dependant on the whims of Russia.

She said: “Europe is too dependent on gas and therefore our dependence on gas imports is excessive.

“This makes us vulnerable. Our response has to be based on the diversification of our suppliers.”

French President Emmanuel Macron and the leaders of nine other nations have penned an open letter to the European Commission, urging it to update its green taxonomy to include nuclear power.

Source: Read Full Article