Belgium takes over to ask for a gas price cap

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Smoke rises from a chimney of a combined cycle gas turbine power plant in Drogenbos, Belgium April 27, 2021. REUTERS/Yves Herman/File Photo

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BRUSSELS, March 21 (Reuters) – Belgium will take the lead in pushing for a cap on gas prices in Europe, its government said on Monday ahead of a summit where European Union leaders will discuss new measures to protect consumers from soaring energy prices.

EU countries have already poured billions of euros in tax cuts and subsidies to tackle soaring energy bills – but with gas prices hitting new highs after the invasion of Ukraine by Russia, countries are looking for additional options.

“When the market does not work, we have to step in and work, for example, with a capped gas price,” Belgian Prime Minister Alexander de Croo said Monday during a joint press conference with Spanish Prime Minister Pedro Sanchez. .

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Belgian Energy Minister Tinne Van der Straeten says Belgium is ‘taking the lead in Europe’ on price cap proposal, combined with joint purchase of gas between EU countries , and that both ideas had the support of Spain.

Spain and Portugal said last week they had drawn up proposals to impose a price cap of 180 euros per megawatt hour (MWh) for electricity. But a source in Spain’s energy ministry said on Monday the cap was not the country‘s main proposal ahead of the EU leaders’ meeting, and that Spain would instead prioritize an idea to decouple the price of electricity. electricity from that of gas. Soaring gas prices are the main driver of rising electricity costs.

Russia is Europe’s biggest gas supplier, supplying around 40% of the EU’s gas. Its invasion of Ukraine, which Russia describes as a special military operation, has prompted the European Commission to draw up plans to end the EU’s dependence on Russian gas within a few years. by increasing imports from elsewhere and developing renewable energies more rapidly.

Meanwhile, Brussels will offer additional options for countries to tackle soaring energy prices, ahead of the leaders’ summit in Brussels on March 24-25.

The plans, which follow an initial set of options released by the EU in October, are expected to include financial support for vulnerable consumers, as well as market intervention options – a move opposed by some states , including Germany and the Netherlands, which warn of causing disruptions in energy markets that could undermine investments in clean energy.

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Reporting by Kate Abnett and Marine Strauss; Editing by Sandra Maler

Our standards: The Thomson Reuters Trust Principles.

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