The price of energy and the worries of life continue to rise,

The price of energy and the worries of life continue to rise,

In his opinion, about the price of energy that continues to rise and the concerns of life at the European level, Vincent Collen, Fabienne Schmitt wrote, for Les Echos, about the proposals coming from the European Commission, but also the wishes that the EU member states have .

Thus, gathered in the council in Brussels, on Friday to define a common position that aims to stop the increase in energy prices, the European ministers agreed on the main guidelines. However, several differences oppose them in relation to the implementation of the Commission’s proposals. Thus, no consensus emerged regarding the capping of the price of Russian gas.

It is an agreement on the main principles, but much remains to be done. Gathered in Brussels in an extraordinary council intended to discuss the measures proposed by the Commission to lower the exploding energy prices in Europe, the European ministers agreed on the broad guidelines, but did not manage to clearly define the methods of application.

In his opinion, “I hope we will conclude our discussions at the end of September,” said Czech industry minister Jozef Sikela, leaving the council, promising “concrete solutions.” Ursula von der Leyen, the president of the Commission, is to present the final version of this package of measures on Tuesday, in Strasbourg, Les Echos reports.

Income of electricity producers

The first topic that is on the agenda, in particular, is the recovery of the income of electricity producers with low production costs, a “solidarity contribution” taken from oil and gas companies, temporary emergency measures such as capping the price of Russian gas, as well as a support for vulnerable energy suppliers.

In this sense, several differences still oppose them regarding the way to put these great principles into practice. The 27 failed to agree on one of the emblematic proposals of the Commission, the establishment of a ceiling for Russian gas imports. “15 countries have clearly spoken in favor of a general capped price, for all gas imports, not only for one country’s operator”, explained the Italian minister of energy transition, Roberto Cingolani.

If Moscow were to completely cut off the gas…

In the energy context, many fear that a measure that would specifically target Russia would not cause Moscow to completely turn off the gas tap, as Vladimir Putin formulated the very precise threat this week. This would reduce the supply of Europeans a little more – Russian gas still represents 9% of imports -, risking leading to a new increase in prices. According to the French minister, Agnès Pannier-Runacher, dealing only with Russian gas “would not have enough impact”. The Council of Ministers asked the Commission to come back with “more comprehensive thinking,” she said.

The 27 did not even reach an agreement on the operation of the ceiling proposed by the Commission on the income of electricity producers who benefit from the price increase. Some – including France – would like the limit from which the benefits are confiscated not to be the same for the different types of producers: nuclear, renewable, coal plants… “We have to take into account the diversity of technologies, estimated Agnès Pannier-Runacher. The commission must make proposals to us”.

To reduce electricity consumption

from the point of view of the measures, the other subject that divides concerns the mandatory nature or not of the reduction of electricity consumption. The Commission envisages a 5% drop at consumption peaks. “Ministers are reluctant to commit,” admitted European Energy Commissioner Kadri Simson, while Jozef Sikela said he expected a mechanism similar to the one set up in July to reduce gas consumption.

Concretely, the measures do not become mandatory unless at least five member states request it. “We have to accept that in such heterogeneous situations, unfortunately, it is very difficult to find a solution that suits everyone quickly”, explained the Italian minister.

In conclusion, all the measures adopted individually by European countries are already important. Price freezes, aid and other support mechanisms representing 3% of the Old Continent’s GDP, Citi analysts calculated, in a note published on Friday. With big differences from state to state. Together, these measures allowed to reduce the inflation rate in the euro zone by three percentage points, according to these experts.