The European Commission prepares to approve its plan to deal with Putin’s gas cuts | International
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With Russian President Vladimir Putin tightening his grip on Europe’s gas ever more firmly, Brussels has reacted by bringing the common energy policy to the fore. Faced with the prospect of a winter of discontent, with citizens furious over inflation and skyrocketing electricity prices, the European Commission will launch a package of tools to resist the lack of energy supply and try to stop the blow to the piggy bank of the most vulnerable households and businesses. The Community Executive is going to approve a regulation that establishes a compulsory goal of saving at least 5% in electricity consumption during peak hours for all Member States, and a tax on oil and gas companies of 33% on their level of extra benefits, according to the draft to which EL PAÍS has had access. The tax is added to other taxes on the rest of the energy companies, which have seen their economic returns increase enormously due to the high prices, and which should revert to those vulnerable households and companies.
The germ of European integration as we know it today was born after the Second World War, with the European Coal and Steel Community (ECSC). And in 2022, on a continent that lives once again with a war, that of Russia against Ukraine, and in which winter already feels like a tough test, with the head of the Kremlin using gas as a weapon, energy returns to be a critical issue.
The health crisis due to the coronavirus pandemic, with the joint purchase of vaccines and a recovery plan to mitigate the effects of the coup, strengthened European integration and paved a path that has also favored the cooperation framework for the war in Ukraine. Now, the energy supply is the focus and focus of the European Commission’s policy and is expected to be a main axis of the speech on the state of the Union this Wednesday by its president, Ursula von der Leyen, before the plenary session of the European Parliament in Strasbourg . Olena Zelenska, wife of the President of Ukraine, Volodímir Zelenski, will attend as a guest, as announced by Von der Leyen herself on Tuesday.
The message from the European Commission is clear: urgent action must be taken and it must be done now. It is expected that the energy ministers of the Member States, who already met urgently last week to fine-tune the lines of the regulation proposals that the Commission has now shaped, will debate the final project on September 30 in a meeting in Brussels. The opposition of some countries to putting a price cap on Russian gas (and the intention of others to implement it for any gas), as proposed by Von der Leyen, will require more time, say community sources, so that price cap on gas seems to have fallen from the proposal, according to the document that this newspaper has read.
The idea of the new European regulation is to act on the market to lower prices, help the most vulnerable consumers and, at the same time, reduce consumption. And that is the spirit of the energy policy being followed by the Von der Leyen Commission, which has taken a very hard stance against what it considers to be “blackmail” by Putin. One of its objectives is to prevent cracks in the bloc’s support of the Twenty-seven for Ukraine, a country that has already completed 200 days of large-scale war and that, with the help of weapons supplied by its allies, is making progress in a counteroffensive that has forced Russian forces to withdraw from strategic territories in the east.
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Brussels establishes, for example, that this mandatory saving of 5% of electricity consumption must cover at least 10% of the hours of each month in which prices are expected to be higher (this would lead to the selection of three or four hours per day of the week, according to the document prepared by the Commission). It will be the Member States who will decide those hours and also who will choose the appropriate measures for saving. The initiative could lead to a reduction in gas consumption of 1,200 million cubic meters for four months, according to calculations that include the draft regulation proposal, which the college of commissioners has approved this Tuesday, but which will not receive the light final green until tomorrow, in sync with Von der Leyen’s speech.
The tax on the producers of the so-called “inframarginal” energies is also advancing, that is, those that are not gas, which have seen their profits increase enormously and will have to contribute everything that exceeds an income of 180 euros per megawatt per hour ( the average is now 450 euros per megawatt hour, although it has reached more than 1,000 euros). The figure is below the current market, but some consider it excessive and a missed opportunity for “vulnerable” households and businesses because it far exceeds the historical average and its average cost of production. Brussels does not speak of taxes, but of ceilings and “solidarity contribution”, as the euphemism it uses for the tax that it will introduce for oil and gas companies, which must contribute 33% of any profit greater than 20% of what have obtained more than the average of the last three years. It will be the Member States who decide to which households and companies and how the income obtained by these new taxes will go.
For some, however, the measures of the European Commission are late. 10 days ago, the president of the European Council, Charles Michel, charged in an interview with EL PAIS, against the Community Executive for not having reacted before. Although many in the EU hid their heads in the sand when Putin started using gas as leverage last year, at the time to try to speed up the start-up of the Nord Stream 2 gas pipeline, which was to carry Russian gas directly to Germany under the Baltic Sea. And when at the gates of last winter he cut off the gas to Moldova (now a candidate country for the EU) by failing to reach an agreement on a new price with the pro-European Moldovan government.
The Spanish president, Pedro Sánchez, was also not heeded at first, when he requested for Spain and Portugal (considered in a certain way an “energy island” due to their few interconnections) to put temporary caps on the prices of gas that is used to generate electricity with the objective of quickly lowering the electricity bill with the so-called “Iberian exception”. Now, this energy war has also fully affected all EU citizens, and prices, exacerbated by the post-pandemic and the Russian invasion of Ukraine, have reached historically high levels.
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