Special Edition: EU capitals get ready for heated energy talks

EURACTIV’s partners across Europe analysed the mood in the bloc’s capitals as Europe could be heading into a harsh winter for its energy-poor population that many see as the make-or-break moment for the European Commission’s flagship policy: the European Green Deal. [Shutterstock/ r.classen]

As heads of government plan their trip to Brussels for the European Council on 21/22 October, the continued upheaval caused by historic energy prices is the main preoccupation for many of them.

EURACTIV’s partners across Europe analysed the mood in the bloc’s capitals as Europe could be heading into a harsh winter for its energy-poor population that many see as the make-or-break moment for the European Commission’s flagship policy: the European Green Deal.

While the French government fears another ‘Yellow Vest’ moment as diesel prices continue to climb, the German caretaker government is content to monitor the situation as the energy price crunch continues to develop and Europe heads into a winter that may be one of the harshest yet. 

Main conclusions:

  • Gas storage levels are not as low across the board as some would have you believe and many countries are content to adopt a wait-and-see approach as alarm bells ring in other countries.
  • A lot of the traditional alliances are not as solid as one would expect, neither Visegrad nor the bloc of Europe’s south is united in its approach to the crisis.
  • Even though the Green Deal is being tested, the main focus lies on gas, a fuel that continues to be critically important despite all efforts to limit the power it gives to foreign actors.

WESTERN EUROPE

BERLIN

The careful sitting duck. The German conservative-social democrat government remains a sitting duck as chancellor Angela Merkel is in her last weeks in office in her role as caretaker chancellor.

As a whole, the German national gas storage is 75% full and endured a particularly harsh winter in 2015 at similar capacity levels, as EURACTIV understands, which is why Germany is content to continue monitoring the situation.

The government has not enacted any measures to combat the increase in energy prices, although acting minister of the economy Peter Altmaier has suggested that the next government consider an increase in housing subsidies, the ministry told EURACTIV.

“In Germany, very many gas contracts are also of a longer-term nature, there are others that are more reliant on spot markets – all of that is reflected in the price fluctuations,” Merkel said.

The ever contentious Nord Stream 2 is unlikely to be operational within the year, but perhaps the constant gas flow from Nord Stream into Germany is contributing to the government’s calm.

Altmaier announced on Friday (15 October) that the government would effectively subsidise citizens’ energy bills by reducing the renewables surcharge by more than 40%, amounting to over €200 of savings for the average household.

As Angela Merkel is merely an acting chancellor and German citizens are not immediately imperiled by the increase in energy prices, observers do not expect her to push for immediate measures or anything other than small-scale spot measures and continued monitoring of the situation.

(Nikolaus J. Kurmayer | EURACTIV.de)

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PARIS

Yellow Vest anxiety. The 2018 scar of the ‘Yellow Vest’ protests runs deep in France, prompting early and sweeping government action.

“There will be a short-term action of support to the households. The government is working on it and will have to complete its response in the next few days according to developments so as not to leave anyone in disarray”, announced President Macron on Thursday (14 October) during a visit to Seine-Saint-Denis to sportsmen and women to discuss the 2024 Olympic Games.

Prime Minister Jean Castex announced several measures last Thursday (7 October), including a freeze of the regulated gas rate until April and a limit of the increase in electricity prices in the face of soaring energy prices.

Saturday (16 October) will be a crucial day as the record diesel prices could spur a return of the Yellow Vests, observers fear. The price of diesel at the pump (1,5354 euro/L on average in the first week of October) now exceeds the price reached at the beginning of the 2018 crisis.

The executive is keeping a close eye on the subject, especially as it comes on top of soaring gas and electricity prices and may also fear a rise in mobilisation as the anniversary date of 17 November approaches.

“There is the question of lowering taxes, we are not there yet, there may be a question of specific aid. […] As soon as these increases continue and the estimates made indicate that they should continue over time, obviously we would consider protective measures”, said a government spokesperson on Wednesday (13 October).

“We will make sure that distributors play the game and do not take advantage of the situation to increase prices at the pump (…) I also ask distributors to make a gesture in this difficult period by reducing their margins”, said Environment minister Barbara Pompili on Tuesday. 

These remarks drew criticism, considering that taxes represent most of the diesel price, not the margins distributors make.

Emmanuel Macron spoke of a “short-term action” on Thursday (14 October) to support households, and also mentioned possible “diplomatic action” to bring down oil prices.

Expect Macron to extol the virtues of nuclear power and allude to his recent €30 billion investment plan announced this week at the summit.

(Mathieu Pollet | EURACTIV.fr)

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VIENNA

Forced calm in the face of political upheaval. Austria has implemented no measures to tackle the energy shortage and the matter is currently not on the agenda of the Conservative-Green Coalition.

However, Renate Anderl, President of the Austrian Chamber of Labour said in a statement on Wednesday, that the government should pass a “protection package” to support Austrian households to deal with the rising prices.

The Social Democrats, for their part, are pushing to fight “the wave of price increases” by cutting the VAT rate for electricity and gas by half for one year, until the crisis is over.

The current energy prices are not in the spotlight in Austrian public political discourse. If they are discussed or mentioned, it is only in reference to the European Union’s attempts to tackle the crisis.

Austria’s Sebastian Kurz was forced to step down as chancellor last week following investigations regarding allegations of corruption and bribery.

His successor Alexander Schallenberg said on Thursday, that the current proposal of the European Commission to tackle the crisis is “very balanced.” 

However, Schallenberg also warned against intervening “too hastily” in the European energy market.

(Oliver Noyan | EURACTIV.de)

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BRUSSELS

To go nuclear or not? The Belgium government is facing a row over nuclear energy while it must contend with the cost of rising energy bills. 

The government said it will make €760 million to Belgian consumers in order to assist them with the higher prices for gas and electricity, which will in part be achieved by extending the country’s social tariff until the spring of 2022.

In keeping with the EU’s toolbox of measures announced Wednesday (13 October) the measures will be limited to around one million poorer households

The lack of gas is mainly being blamed on lack of production in Norway and Russia, while some anti-EU sentiment is embedded in the discourse around the impacts of the EU ETS prices which have seen a rapid increase in 2021.

“We’re not convinced at this stage that group purchases would be a solution. We think that we need to continue discussions in the European Council,” Celine Tellier, environment minister for Wallonia, told EU ministers as reported by Reuters.

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AMSTERDAM

Dutch sit comfortably on the gas throne. The Dutch government is expected to lower energy taxes amid the surge in prices in a move intended to help households cope with soaring energy bills. 

The caretaker administration of Mark Rutte, who continues to struggle to form a government, aims to save the average household about €400 per year in energy costs, Yesilgöz-Zegerius, state secretary for economic affairs and climate, told journalists.

The country is one of the EU’s largest gas producing countries with large storage capacities that the country can rely on, similar to Germany, although the country’s gas stores were “only” 65% full as of 4 October. 

Having the fourth largest gas storage at their back, the Netherlands are content to adopt a wait-and-see approach to more concerted EU action as they continue to be hampered by political instability.

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LUXEMBOURG

Banking hotspot wants to curb speculation. Luxembourg’s energy minister, Claude Turmes, believes that the increase in energy prices is due to speculation in the gas market. 

He proposed a revision of the EU ETS directive. “We have to stop the extremely speculative behaviour of some traders,” he said. 

During a meeting with other European energy ministers earlier this month, Turmes warned against intervening in the liquid and liberalised energy market, which he said works well. 

He has also spoken out against changing CO2 taxes as a measure against price increases, saying that the outcome would be minimal and would send out the wrong message in terms of climate change.

The price surge is also impacting Luxembourg’s economic outlook and public finances, according to finance minister Pierre Gramegna, who said energy prices were one reason for Luxembourg to be cautious about its fiscal planning.

(Julia Dahm | EURACTIV.de)


SOUTHERN EUROPE

ROME

Budgeting in the crisis. Italian Prime Minister Mario Draghi’s government plans to insert “structural solutions” to the energy crisis in the upcoming budget. 

“Aside from pursuing our current strategy to mitigate increases in social prices while keeping sustainability in mind, we need to consider structural measures”, Draghi stated in early October. 

In late September, as a response to early signs of the energy crisis, the government passed a decree to reduce the burden of higher bills on end users. 

It included temporarily setting the “general system charges” for 6 million small businesses to zero, significantly reducing energy prices.

“General system charges” are understood to make up about one third of consumer electricity prices.

It also provided additional resources for 3 million families in need and lowered the VAT on natural gas to 5% (down significantly from the previous 10% to 22%).

The measure cost the government €3.4 billion.

“The government’s intervention on bills was aimed at mitigating the effects of the price increase on the short term, and we will follow the same compass while carrying out the ecological transition,” Draghi said. 

His words mirror the main discussion that has developed around energy prices in the past few months, with ministers Giancarlo Giorgetti and Roberto Cingolani both underlining repeatedly that they do not want to see the transition turn into “an economic bloodbath”.

Centre-right Forza Italia MEP Massimiliano Salini called on the EU to temporarily stop penalising traditional energy sources in this critical phase. 

“A system that disfavours sources such as gas, thus fuelling an increase in prices paid by households and businesses, is unacceptable. To implement Article 194 of the Union, which, in addition to the transition, requires security in energy supplies, we must return to technological neutrality”, he stated. 

Most of the mainstream Italian parties participating in the coalition supporting Draghi’s government agree with the need to keep prices down for end users.

Italy is understood to favour an EU strategic gas reserve and EU joint purchasing of gas.

(Viola Stefanello)

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ATHENS

Greece to go big on subsidies and gas. Electricity bills are to be subsidised by €18 per MWh for the first 300 KWh of consumption each month.

Support for consumers will be financed by the Special Support Fund for the Energy Transition, from which €500 million will be diverted from the increased revenue for Greece in 2021 from the EU ETS.

Low-income households will get a higher monthly subsidy of €24 a month, while gas and power suppliers will offer additional discounts to consumers. The subsidies are estimated to cost €326 million.

The government will also spend another €168 million to offer a higher one-off payment to help households buy oil, gas, wood, and biomass for winter heating.

The opposition criticises the amount of subsidy as insufficient and the government as impotent due to changing announcements by the month. Subsidising a consumption of 300KWh per month is good for the summer but not for winter when consumption soars, said a spokesperson of SYRIZA, the main opposition party.

It also stressed that the government has not covered groups like farmers and small businesses and failed to address the issue of the low poverty threshold.

The opposition called for the government to raise the minimum wage in order to tackle the issue of rising prices and inflation

The main message of the government regarding energy prices is that it will protect social cohesion by subsidising energy consumption for all.

The Greek government seems to approve of the toolbox announced by the European Commission and is planning to make use of the ability to defer payments for households.

The opposition stresses that funds from the EU’s emissions trading scheme should not jeopardise the transition to more climate change resilient projects and the renewable energy fund.

Prime Minister Kiriakos Mitsotakis has explicitly stated that he was in favour of a policy of joint gas purchases, as the EU had done for the COVID-19 vaccine.

Greece is among the countries that supports natural gas as the preferred fuel used in the process of transition to renewables by 2030.

(Matthaios Tsimitakis | Euractiv Greece)

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MADRID

Spain claws back utilities’ profits. Spain’s minister for Ecological Transition, Teresa Ribera, recently stressed that the Government is committed to achieving by 2021 an average energy price paid by Spanish consumers no higher than in 2018.

So far, the Iberian country has adopted some measures to limit the record price hike experienced since May, among others: by promoting self-consumption and local energy communities, energy efficiency, a new tax structure (reducing VAT from 21% to 10%) and a series of social protection measures for the most vulnerable.

One of the main measures taken so far by Spain was the approval this week in Parliament of a decree aiming to reduce energy bills for consumers (with a specific focus on the most vulnerable), by moderating the record profits of the largest electricity companies (among them Iberdrola, Endesa, Naturgy) via the high prices of gas. 

This decree, which has yet to be voted on by the Senate, Ribera explained on Thursday (October 14), won’t in principle have an impact on those companies that guarantee stable and “reasonable” prices to the industry.

“Although the main variables that determine their evolution (of the energy prices) are beyond the control of the governments of the European Union (EU), we have focused our attention on what we can do, on the most important parameters of the electricity bill”, she stressed.

According to EU sources quoted this week by the Spanish press, the European Commission is willing, as requested last week by Spain’s socialist prime minister, Pedro Sánchez, to explore the option of “voluntary joint purchases” of gas at European level, to review the regulation to improve gas storage capacity in the EU and to study the functioning of the electricity market. 

The leader of Spain’s main opposition party, centre-right Partido Popular (Popular Party), Pablo Casado, has proposed to lower the electricity bill by up to 20%. 

The PP’s initiative aims to generate savings of around €7 billion for people’s electricity bills by the end of this year. 

Part of the reform presented by the PP involves making permanent the temporary tax reforms agreed in June by the Spanish government.

With the suspension of the Electricity Generation Tax (“Impuesto de Generación Eléctrica”), which levies up to 7% of the bill, the Popular Party estimates that more than €2 billion could be saved. 

So far, it has only been approved for the third quarter of the year.

Pablo Casado’s party also advocates further reduction to the VAT rate for electricity, which already went from 21% to 10% in June after the record high rates in the wholesale electricity market. 

This could translate into consumer savings of another €2 billion in the final calculation.

Spain’s gas reserves are about 75% full, although the total capacity of the country’s reserves lags behind smaller countries such as Hungary and the netherlands.

(Fernando Heller | EuroEFE)

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LISBON

Low on gas storage, high on calm. Gas storage levels in Portugal are reported to be the lowest in all of Europe, at about 50% according to ENTSOG. 

Yet, the country has been reported as having adopted a wait-and-see approach in line with countries with much fuller gas storages like Germany and the Netherlands.

Current high gas prices are hurting the nation’s industries and are a signal for Portugal to speed its transition away from fossil fuels, said Joao Galamba, deputy minister and secretary of state for energy,  in September.


VISEGRAD

WARSAW

Cheapest electricity, biggest complaints. Poland, as the EU’s most coal-dependent country, is least vulnerable to rising prices for energy, yet lower income households are disproportionately affected.

Poland had maintained record-low electricity spot prices throughout the past weeks, setting them apart from other EU states.

Nonetheless, there is a general fear that rising bills for energy will further hit the poorest in society, an important group of voters for the ruling party.

The ruling Law and Justice (PiS) party, currently in a spat with the EU over the supremacy of EU law, has its own explanation of the current situation. State Assets Deputy Minister Maciej Małecki said recently that the EU is partially responsible for the rising energy prices. 

The EU’s energy policy led to rising costs of carbon emissions, resulting in rapid increases in energy prices, Małecki states. He suggested other reasons including “Putin’s speculative games on the gas market” and “EU western states’ naive approach towards the Kremlin’s policy”, says the minister.

Małecki argues that the State Treasury, as an energy companies’ shareholder, “encourages those companies to effectively manage and use all opportunities to mitigate risks connected to the rising prices of allowances and gas”. 

The Climate Ministry is working on a new draft bill that would protect people from rising energy prices, to be published soon, according to Deputy Minister Piotr Dziadzio. 

However, contrary to what State Assets Minister Jacek Sasin suggested earlier, only the most vulnerable citizens can expect to be compensated through the new bill.

(Aleksandra Krzysztoszek | EURACTIV.pl)

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PRAGUE

Dominoes start falling in Czechia. The Czech government will introduce “energy cheques” for low-income households. According to Trade, Industry and Energy Minister Karel Havlíček, vouchers could help around 3.2 million Czech people, especially those affected by energy poverty. Energy cheques should be available by the end of the year.

Moreover, following the shutdown of Bohemia Energy, one of the major energy suppliers in Czechia, Prime Minister Andrej Babiš is considering dramatic energy tax cuts from the current 21% to 0%. 

On Friday (15 October), the Czech Finance Ministry confirmed that it wants the EU to approve such a move. 

The European Green Deal is often blamed for the energy price surge. “It is unequivocally caused by a too-rushed green policy and by a too fast coal phase-out in Germany. I am not assessing that from the environmental point of view but from the energy one,” said Havlíček, quoted on Czech Television.

“We signed the Green Deal because if we had refused to sign it, we wouldn’t have got any money and it would have been enacted anyway. We did not sign the fury road that leads to it,” he added.

Czech PM Babiš is also critical of the EU ETS system and calls for a cap on emission allowances prices.  

When it comes to European solutions to energy price crises, Czechia signed a joint letter with France, Spain, Greece and Romania calling for better coordination of gas purchases at EU level. 

However, as EURACTIV understands, the Czech government is sceptical of EU joint procurement of gas. 

(Aneta Zachová | EURACTIV.cz)

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BRATISLAVA

Just a ‘mild’ electricity price rise in Slovakia. Minister of Economy and former Member of European Parliament Richard Sulík admitted that energy prices will go up in January. However, the rise won’t be as high as in some other countries.

Energy experts even consider it to be “mild”. The average household will only pay an additional €4 or 5 a month as the government has already introduced some counter-measures. Sulík also said that he expects prices to fall again next year. For now, people should adjust, he added.

“When prices are rising, demand is decreasing. Industry is already lowering production,” Sulík said.

The Ministry of Economy already announced the temporary abolition of mandatory payments for the decommissioning of nuclear units in Jaslovské Bohunice nuclear power plant.

Currently, this payment is €3.27 a month. Moreover, subsidies for the operation of solar power plants will be reduced and the tariff for the system operation will change as well.

The final price will be decided by the Office for the Regulation of Network Industries in the coming weeks.

While Sulík is saying that the price rise will be low because of the steps taken, opposition parties disagree. Former Prime Minister Robert Fico and his SMER-Social Democracy party want Sulík to resign and called for a no-confidence vote in the parliament. Former minister of finance for SMER Ladislav Kamenický suggested the adoption of energy vouchers. According to Kamenický, the government should also lower the electricity tax as has been done in Spain.

Another opposition party – Hlas, of other former prime minister Peter Pellegrini suggested temporarily lowering the VAT rate from 20 to 5% for all electricity-related services.

Sulík said he does not have a problem with this proposal and said he will support it in a coalition meeting. However, he noted that tax issues are in the hands of the Finance Ministry – under another former prime minister Igor Matovič.

(Michal Hudec | EURACTIV.sk)

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BUDAPEST

Not in crisis, ETS is to blame anyway. The Hungarian government has chosen so far not to enact measures because, as prime minister Viktor Orbán put it during his arrival at the EU summit in Slovenia on 5 October “Hungary’s out of that [problem] because we have a price cap system” for household energy prices. The rising prices nevertheless affect Hungarian industry and businesses.

Pointing the finger at Commissioner Timmermans, Orbán said the Union’s green chief was responsible for “having made a very bad calculation and now the people of the European Union are paying an extra price.”

Orbán also called for the cancellation or suspension of ETS and said the “ETS system must be cancelled or suspended” and “we have to go back to the reality.”

Later in the week, the Hungarian prime minister said “those fine bureaucrats have come to the conclusion that the way to fight climate change is to continually raise the price of energy – the price of energy produced from coal or gas, which push each other up. And now that the price of gas has gone up on the world market, there have been sharp retail price increases”.

Speaking to public radio during his weekly appearance on 8 October, he added Poland, Czechia and Hungary will stand united and “we demand withdrawal of the rules that have contributed to the current high prices”.

Orbán also promised to stand firm at the next European summit.

“We’ve already made several proposals, to change certain rules, to withdraw certain regulations, and to mobilise funding designed to be used in the European Union in times of crisis,” he told listeners. “So we’re not just being negative and we’re not just using our veto, but we’re making proposals on how to deal with this situation.”

Meanwhile, Attila Steiner, State Secretary for Circular Economy Development, Energy and Climate Policy at the Ministry of Innovation and Technology told Portfolio.hu on Friday (15 October) that the government is still analysing what options it should take in the business sector from the package of measures published by the European Commission on Wednesday.

(Vlagyiszlav Makszimov | EURACTIV.com)


THE BALKANS

LJUBLJANA

Council presidency with other concerns. The current EU council presidency holder, the Slovenian government led by Janez Janša, has yet to enact measures to combat the energy price surge.

The government has adopted a wait and see approach on energy prices, but might move now that the Commission has provided some guidance. 

There has been talk about helping companies, but nothing yet for households. The economy minister has mentioned the possibility of acting on electricity prices, probably by lowering duties. 

The government has been sending calming messages, but has generally been in the background of the debate, which has been spearheaded by companies and consumer groups. The opposition has not yet seized upon this issue as an opportunity.

As for the role of the EU, there is a palpable sense that the country is not far away from the energy transition being declared the culprit, although top officials have so far refrained from that. 

It is interesting that whenever the EU starts discussing the green transition “we witness a horrific rise in energy prices,” said Economy Minister Zdravko Počivalšek on Wednesday (13 October). 

The proposal by the European Commissioner for Energy, Kadri Simson, to consider voluntary EU joint procurement and an integrated European approach to gas storage appears to have not yet entered the agenda in Ljubljana.

(Sebastijan R. Maček | STA)

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ZAGREB

A promise of stability at the cost of personnel. The Croatian government passed a decree on Thursday limiting the retail price of petrol to 11.10 kuna (€1.48) per litre and the price of diesel to 11.00 kuna (€1.46) per litre for the next 30 days. 

Economy Minister Tomislav Ćorić said that household gas prices in Croatia would not change until April 1, 2022. As for electricity, it is announced that prices will not change for households until at least January 1 next year. 

The business sector has problems. Those without long term supply agreements with electricity or gas providers are exposed to new, higher prices. 

In the capital, Zagreb, the director of local gas provider “Gradska Plinara” (City Gas Pipeline Zagreb), was fired because it did not provide enough gas on time at significantly lower prices, so they are now forced to buy gas on the stock exchange at three to four times the price after market disruptions. 

Therefore, Plinara announced the increase in the price of this energy source to all entrepreneurs from 1 November. 

“The government would be closely monitoring the situation and trends on global markets and take further steps as necessary”, said Prime Minister Andrej Plenković. 

The proposal by European Commissioner for Energy, Kadri Simson, to consider voluntary EU joint procurement and an integrated European approach to gas storage has not gained traction in Zagreb thus far, as EURACTIV understands.

(Zeljko Trkanjec | EURACTIV.hr)

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SOFIA

The poorest energy-poor country devoid of a parliament. The Bulgarian government has announced several measures to support the economy against rising electricity and fuel prices, but so far none of them have shown effectiveness. 

Currently, the EU’s poorest member state is limited in its ability to support its economy because it is in a severe political crisis. 

The country has no functioning parliament, the parties are campaigning for parliamentary and presidential elections, and the government is in the hands of a caretaker government appointed by President Rumen Radev, who is also campaigning. 

Тhe caretaker government decided а month ago to cover part of the increase in high electricity bills for businesses by €25 per MWh.

This energy voucher would cover 20-25% of the price if the government could start paying it. However, compensation can be received in December at the earliest if the next parliament approves an update of the 2021 budget. 

The other measure to support the economy was the launch of 300 megawatts of electricity at lower prices produced by the nuclear power plant. 

This had to be sold to small and medium-sized businesses. The failure of this measure was visible. The energy exchange allowed the packages to be bought by the big factories in the country. Only ¼ of the energy packages reached small and medium-sized businesses.

The government also tried to influence the market. At the beginning of October, a police operation was carried out in the offices of a large intermediary company for trading in electricity on the stock exchange. 

The authorities hope that the launch of Chaira, the largest pumped-storage hydroelectric plant in Southeast Europe, by the end of the year will have an impact on the market. The plant has been under renovation for several years.

(Krassen Nikolov | EURACTIV.bg)

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BUCHAREST

Political instability on top of energy crisis, Renew Europe chairman to the rescue. Romania is currently facing the fact that stored quantities of gas are lower than in other years in the same period, as well as a national discussion over capping gas prices.

In September, electricity prices were 23% higher than at the end of last year, while the natural gas prices increased by over 20% compared with December 2020. And experts estimate prices will continue their upward trend over the next period for both energy resources.

In this context, authorities have finally hurried the adoption of the regulation that defines the vulnerable consumer, which was signed into law in September. 

Romania is also experiencing a period of political instability, as the government was ousted on 5 October after failing to meet the threshold to pass a no-confidence vote.

However, interim Prime Minister Florin Citu said aid for vulnerable consumers would not be enough in the current market context and the government also adopted another normative act that partially subsidises price increases. 

For example, gas bills could be reduced by 25%, while a fraction of the kilowatt-hour price would be covered from the state budget.

Moreover, the government analysed a potential cap on natural gas prices, although both the prime minister and the energy minister Virgil Popescu previously said they do not favour such a decision.

But after the government lost a confidence vote in the Parliament last week, the now interim prime minister said the government would cap energy prices in the first meeting after it is installed with full powers. 

Under Romanian law, if a government is voted down through a motion of censure in Parliament, it continues as an interim Cabinet, with limited powers.

Meanwhile, the opposition socialists have urged the interim prime minister, who is also a senator, to abandon his ambitions to govern and vote for the draft law that is currently discussed in the Senate. 

PSD has drafted a law that aims to cap the price of electricity and natural gas for both households and companies at an average value of the prices seen in the first nine months. 

The cap will last for six months, according to the draft law.

PM designate Dacian Ciolos favours cutting VAT and excise duties for energy products, in line with the proposals of the European Commission. 

Also, Ciolos proposed subsidising the thermal power plants so that the heating costs of household customers would not explode, and extending a fiscal credit line to cover at least part of the energy cost increases for SMEs.

The Romanian Parliament has also set up a special inquiry committee to investigate the increase of energy prices. 

(Bogdan Neagu | EURACTIV.bg)


Non-EU

Serbia: Population won’t have to pay more for electricity and gas, homes will be warm. Serbian President Aleksandar Vučić has said that citizens’ homes will be warm during the upcoming winter because Serbia has stockpiles of natural gas, and has added that electricity and gas prices will not go up for households.

In his words, Serbia has “made a smart decision” not to shut down the coal mines, which provide coal for the production of almost 70% of the country’s electricity.

Where gas is concerned, Vučić has said that Serbia has roughly 250 million cubic meters of gas in the Banatski Dvor storage facility and is storing new quantities daily. 

“We are delivering to the Hungarians, we are taking from 6.3 at the peak to 9 million cubic meters of gas on a daily basis… We are not using [gas] from Banatski Dvor but rather the one regularly coming to us via the pipeline… and we put the excess in Banatski Dvor,” Vučić told reporters a few days ago.

He also said that Serbia had “led a smart policy” and built a gas pipeline in spite of all the external pressure.

According to him, projects are being prepared for the construction of new hydropower plants Đerdap 3 and Bistrica, which will increase the national electricity production capacity by 15%.

Prime Minister Ana Brnabić announced the formation of a working group which would propose measures to mitigate the consequences of rising energy prices.

Srbijagas CEO Dušan Bajatović confirmed that Serbia was not facing problems in gas supply during the winter and that the price for households would not change until the end of the heating season, whereas big consumers would pay the commercial price.

Bajatović also said that Srbijagas had sufficient quantities of gas in underground storage and recalled that gas bound for Hungary had been moving through Serbia through the TurkStream pipeline since October 1.

At the same time, power company Elektroprivreda Srbije acting director Milorad Grčić said that Serbian citizens had the cheapest electricity in the region and that it would stay that way, but that the government and companies were working on defining a price for businesses.

The Serbian Association of Employers reacted to this by launching an initiative to stop the trend of drastically raising electricity prices for companies, because that would lead to an increase in the prices of most goods and services and simultaneously jeopardize the operations of numerous companies. (BETA / EURACTIV.rs)

[Edited by Nikolaus Kurmayer, Benjamin Fox | EURACTIV.com]


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