Soaring energy prices raise EU political challenges

Brussels — The European Union announced on Wednesday that it would consider how to operate the electricity market and consider proposals to amend regulations within the block.

Europe’s electricity and gas prices soared this year as tight gas supplies clashed with strong economic demand recovering from the COVID-19 pandemic.

Energy prices on Wednesday exceeded the EU’s political agenda, and the Minister of the Environment and the European Parliament each discussed the issue after discussions on possible actions by national leaders on Tuesday night.

The crisis has divided Member States as to whether Brussels should intervene.

“There is no doubt that we need to take policy action,” EU Energy Commissioner Kadri Simson told the EU Parliament.

Next week, the Commission will unveil a menu of options on how the government and the EU can respond, investigating whether the EU’s electricity market is suitable for achieving the planned transition to green energy in the block. Said Simson.

Spain and France are calling for amendments to EU electricity regulations to separate electricity prices from gas costs.

“I believe this framework is healthy, but there are challenges,” Simson said.

Spain’s Prime Minister Pedro Sanchez said he and other countries had requested Brussels to provide a “bold” response. “We need extraordinary and innovative measures … we called for a group buying of gas,” he said.

Not all countries are convinced. EU regulators expect gas market conditions to ease next spring, and some governments say the issue is most of a tax cut to protect consumers from state subsidies and high bills. It states that it will be treated well.

“This is primarily something that member states should work on,” said Dutch Prime Minister Mark Rutte. “We should see what Europe can do collectively. I have a suggestion. Some are wild and some are not.”

Hungarian Prime Minister Olburn called the planned green policy an “indirect tax” on citizens on Wednesday. “Part of the reason for the rising prices is the responsibility of the Commission,” he said.