Contrary to Poland, the EU approved the obligation to save electricity. But there will also be an EU tribute from Sasin

The ministers of 27 EU countries approved on Friday the crisis regulations on mandatory savings of electricity consumption in the entire EU by 5%. during peak hours and – this is a voluntary commitment – total consumption by 10%. in the period from December this year. by March 2023 (compared to the average from previous years). In addition, the EU Council agreed to a tax on windfall profits of fossil fuel energy producers (20% on the surplus above the average in recent years) and on – based on a different mechanism – to collect additional money from producers of renewable energy, nuclear and lignite. The wholesale price in the Union now depends mainly on gas or coal (in Poland), which drives producers’ profits from these other sources despite normal production costs.

estimates that these additional levies from energy producers can bring a total of up to EUR 140 billion, which EU countries will be able to allocate to help citizens and small and medium-sized enterprises. – The agreement reached today will bring relief to citizens and businesses. EU countries will flatten the electricity demand curve in peak hours, which will have a direct positive impact on prices. And they will redistribute the surplus profits from the energy sector to those who have difficulties paying their bills, said Minister Jozef Sikela, who chaired the session on behalf of the Czech Presidency of the EU Council. In turn, Minister Anna Moskwa explained that the activities already undertaken in Poland, incl. as for extraordinary taxation, they are in line with the requirements of these new EU regulations.

Poland “for” but against

Today’s arrangements, once translated and polished in legal language, will soon be formally approved by 27 countries in a written procedure. The government, as Minister Moscow suggested today, intends to vote against in writing, which, however, will be irrelevant to the fate of today’s majority-approved compromise, i.e. without the right of veto. The details of the substantive provisions in Poland – as our talks in Brussels show – rather correspond, but the opposition is an ideological “no” to the transfer of additional powers in the field of energy to common EU institutions.

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– If it were not for formal doubts … – Minister Moscow explained today, arguing that, inter alia, in the field of energy, the Council of the EU should apply the unanimity rule rather than the majority vote. In the summer of this year, it first supported the provisions on coordinated gas savings, but at the stage of the written procedure, the Morawiecki government also voted against. And he also explained it by the fight against the appropriation of powers by Brussels.

Letter of Fifteen

However, the weight of the dispute over the energy crisis has shifted to the price cap for all gas imported into the EU, which would in fact lead to a price cap on the wholesale gas market. As many as 15 EU countries, including Poland, France, Italy and Spain, this week demanded that the European Commission draft a price cap law so that the EU Council could deal with it and finally vote on it. However, the Commission, which has a monopoly on legislative initiative in the EU system, did not comply with these calls. Instead, she presented an analysis with a list of threats from the price ceiling. This argument of the Commission is shared by Germany, the Netherlands and Denmark, which would now be ready at most for a price cap for gas from Russia (its importance has decreased even more after the leaks in Nord Stream), but not for the remaining gas – including from Norway and LNG from the United States United.

– Today I noted the serious concerns of the EU countries related to the actions proposed at the previous meeting of the EU Council, when [apelowano do Komisji o projekt limitu cenowego] – reported Minister Sikela. In turn, Minister Moscow explicitly announced that if the Commission did not want to act, the four initiators of the letter from 15 countries, i.e. Italy, Poland, Belgium and Greece, would start working on the appropriate project themselves in order to bring about a discussion in the EU Council and strengthen political pressure. – Germany will not disengage itself from this discussion at all. I am convinced that we can achieve a good solution, argued Minister Moscow.

Rome criticizes Germany

The introduction of a top-down limit on the price of imported gas in the Union (one of the options is a sliding limit depending on prices outside Europe) would be an extremely strong interference in market mechanisms. The Commission raises concerns that the official undercutting of prices, inter alia, it would discourage LNG sellers, which Europeans are buying at present – thanks to their generous prices – to importers from Asia. In turn, there are voices from the Netherlands that in “civilized relations” with Norway one cannot simply artificially lower the price. Germany, although it had not been keen on it before, is now arguing that a more effective way would be to accelerate the EU’s acceleration of gas procurement under the jointly negotiated system. In this way, EU countries can use a common, and therefore stronger, negotiating position to keep prices down.

Moreover, Brussels and Berlin emphasize that too artificially lowering the price would eliminate the gas saving impulse in the EU, which threatens to ration it for the industry this winter. However, this argument, combined with Berlin’s newly announced € 200 billion package to protect German residents and businesses from the drastic increase in energy prices, is particularly badly received in Italy.

– We cannot divide the Union according to different budgetary capacities of equal countries. We need solidarity – this is how the decisions of the Scholz government were commented today by the soon departing Italian Prime Minister Mario Draghi. And his possible successor, Giorgia Meloni, argued that “no single EU country can alone offer effective, long-term solutions in the absence of a common EU strategy.”

As during the pandemic, Italians ask questions about the threat of disturbances in the EU common market due to different state aid for companies in different EU countries. – If other EU countries come to the conclusion that the huge energy package announced by Germany will undermine the single market, because no other country is able to support its economy to the same extent, we may witness a new debate on an additional package financed by the EU debt (such as Reconstruction Fund), says Janis Emmanoulidis from the Brussels European Policy Center.