BRUSSELS (AP) – The European Union on Wednesday urged member countries to provide relief funds to consumers and small businesses hardest hit by rising gas and electricity prices, as critics shed accumulate that the bloc’s climate change policies are fueling the problem.
In recent days, France and Spain have led the charge for changing the rules governing EU energy markets as soaring prices increase already high utility bills and increase pressure on de many people already hard hit by the coronavirus pandemic.
Energy prices in Spain have hit all-time highs since the summer. The cost of electricity is expected to climb Thursday to 288 euros ($ 332) per megawatt hour (MWh), a 26% increase from Wednesday’s price.
EU Energy Commissioner Kadri Simson said that “provide targeted support to consumers, direct payments to those most at risk of energy poverty, reduce energy taxes, shift burdens to taxation general, are all actions that can be taken very quickly under EU rules. “
“The immediate priority should be to mitigate social impacts and protect vulnerable households, ensuring that energy poverty is not worsened,” Simson told EU lawmakers. She said companies “can benefit from state aid or by facilitating longer-term power purchase agreements”.
The 27-country EU imports around 90% of its natural gas needs, compared to the United States, which produces theirs and where prices are lower.
Simson said that the EU’s executive branch, the European Commission, is set to present next week a “toolbox” of short and medium-term measures that countries could adopt. Some countries are interested in setting up a strategic reserve of gas to be used in an emergency.
Italy is one of them. At an EU summit in Slovenia on Wednesday, Italian Prime Minister Mario Draghi said the idea of pooling resources in how countries have purchased COVID-19 vaccines together “is very positive, so that we do not find ourselves completely unprepared for the surges in energy prices ”.
Hungarian Prime Minister Viktor Orban blamed the rise in energy prices on the European Commission’s “Green Deal” policies to combat climate change, which aim to reduce greenhouse gas emissions by 55% d ‘by 2030 from 1990 levels and to make the trade bloc carbon neutral by 2050.
“The reason prices are going up is the fault of the commission. So we have to change some regulations, otherwise everyone will suffer, ”Orban told reporters at the summit. He called the Green Deal an “indirect tax” on home and car owners.
But the commission’s executive vice-chairman, Frans Timmermans, said “EU climate law is our guiding principle, and we will not be reopening this law.” He said that “the faster we increase our renewable energy sources, the faster we can protect our citizens from price increases in traditional energy.”
Spanish Prime Minister Pedro Sánchez urged the commission “to be courageous”.
“We are facing an unprecedented crisis that requires extraordinary, innovative and firm action,” Sánchez told reporters. He said the EU must “make a collective purchase of gas” and revise the electricity pricing system, which he says undermines the use of renewable energy.
French President Emmanuel Macron agreed that EU countries “must strengthen our capacity to be more independent”, adding that “clearly renewables and nuclear are the two key elements”.
When asked if Russia was fueling the price spike by limiting supply, senior EU officials responded cautiously.
“The level of gas production in Russia is probably one of those elements”, as well as the increased demand in China and the problems of energy maintenance in Norway and Russia, said the President of the Council of the EU, Charles. Michel.
European Commission President Ursula von der Leyen noted that Norway was increasing its supplies and called the action “a very good example that others could follow.”
Joseph Wilson in Barcelona, Spain and Colleen Barry in Milan, Italy contributed to this report.
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