As sky-high energy prices continue to rise across Europe, there are increasing calls for coordinated, quick, and pan-European measures that can protect European citizens and businesses from the ever-increasing electricity and heating bills.
As such, the Commission will present five proposals for how EU Member States can jointly rein in the escalating energy prices that are currently threatening to pull the rug out from under millions of households and businesses in Europe. “We are facing an extraordinary situation, not only because Russia is an unreliable supplier, as we have witnessed over the last days, weeks, months, but also because Russia is actively manipulating the gas market,” said the Commission President Ursula von der Leyen in a press statement given in Brussels on Wednesday.
Although the Commission had hesitated for months to actively intervene in the European energy market, among the key proposals is a price cap on Russian gas imports as von der Leyen announced on Twitter. The Russian government had on several occasions reduced gas supplies to Europe, which has in turn lead to European energy prices spiking to new record highs.
The introduction of a common price cap, however, is hoped to be able to keep the price of Russian gas artificially low. “We must cut Russia’s revenues, which Putin uses to finance his atrocious war in Ukraine,” declared von der Leyen, without however going into detail about how such a price cap should be knitted together, or where it is to be located.
Unsurprisingly, President Putin threatened the EU earlier on Tuesday, announcing that Russia will completely halt gas deliveries to Europe if such a price ceiling is introduced. Putin stated that, if any political decisions were to be made that would contradict the treaties, they simply would not fulfill them. If so, it will hurt EU countries, which have already reduced their imports of Russian gas considerably, but which still need the gas to get power in the sockets.
Aside from the proposed price cap, von der Leyen’s other proposals include suggestions for the reduction of consumption peaks in electricity, the aid for vulnerable households and companies through income from the energy sector that became known last week, and liquidity support for electricity traders who are suffering from extreme price peaks on the stock exchanges.
The price cap will, however, be one of the items that energy ministers will discuss at their meeting today. The Commission wants to present a package of legislative initiatives next Tuesday, after which the proposals would have to be approved by the Council again.