The European Commission has announced a formal proposal to set a ceiling on wholesale gas prices.
The European Commission proposed setting the upper limit on wholesale gas prices for next month at 275 euros per megawatt-hour. The restriction will only apply if prices are above this level for two weeks and exceed 58 euros per MWh. This is what the European Commissioner for Energy Kadri Simson said, reports European Truth on Wednesday, November 23.
“It provides a powerful tool that we can use when we need it,” he said.
He said the proposal is “a mechanism of last resort to prevent and address episodes of excessively high prices that are inconsistent with global price trends.”
However, critics have called this plan almost useless, says the Financial Times. They explained that wholesale gas prices jumped to an all-time high in the summer, exceeding 300 euros per MWh, after Russia cut supplies through its largest route to Western Europe. , the Nord Stream 1 to Germany. But even then, the upper limit will not work, because prices have remained above 275 euros per MWh for just about a week.
“This is a proposal that will not bring anything useful to anyone, even under the extreme scenario we saw in August. This is not a limitation,” said Simon Tagliapetra, a senior fellow at the Brussels-based think tank Bruegel.
Some diplomats from member countries who support the price cap say it is too high for their governments. In particular, a senior EU diplomat said that setting the price above 250 euros per MWh “is another way to break the upper limit.”
It should be noted that European countries are actively increasing the removal of gas from underground storage facilities.
In addition, the share of Russian gas in EU imports fell four times to 9%.
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Source: korrespondent
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.