The Twenty-seven discuss the proposal for a price cap on gas purchases

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The energy ministers of the European Union will debate today the proposal of the European Commission to limit the price of gas in the TTF futures market, in an event that is expected to be intense since both the countries that demand to intervene and those that did not want any proposal on the table criticize the initiative. A majority of Member States They have been pressing for months so that Brussels design a system to limit wholesale purchases of gas in the EU, with Italy, Spain, Poland or France pushing in that direction.

But the Commission, aligned with Germany and the Netherlands, did not want to and has dragged its feet to the point that some capitals threatened to block other energetic texts in which a smooth processing was expected, if Brussels did not present a more ambitious legislative proposal.

Finally, and for the fourth extraordinary energy council since July, the European Commissioner for Energy, kadri simpsonhas put on the table a legislative proposal to limit exorbitant prices in the Amsterdam TTF market, which serves as a reference for a large part of the gas contracts in Europe.

An unambitious proposal

Specifically, the mechanism proposed Brussels as a “last resort” would limit to 275 euros per megawatt-hour (MWh) the price of one-month gas futures in the TTF, but it would only be activated if that threshold is exceeded for two weeks and provided that the difference with respect to the price of liquefied natural gas (LNG) in the international markets exceeds 58 euros.

These requirements mean that, if it had been in force, it would not have been applied even during the historic price record last August. In addition to these two conditions, the legislative project includes an arsenal of safeguards to suspend the cap if it jeopardizes the security of supply or the stability of financial marketsrendering the mechanism almost inapplicable.

The proposal has been criticized by countries that requested a cap, such as Spain, Poland or Greece, which criticize that it is inapplicable in practice, as well as by capitals such as The Hague, which did not want the Commission to make any formal proposal.

Spain fears that the new cap will trigger prices

The president of the Government, Pedro Sanchezhas considered “clearly insufficient” the proposal and has asked the European Union for “European commitment and ambition to address” a solution. At a press conference on the occasion of the first Spanish-Romanian Summit, Sánchez stated that Europe “it’s not on the right track” if that is the solution that is intended to be approved and warned that “it may even have perverse effects, not decrease but increase” Of the prices.

Along the same lines, the third vice president and minister for the Ecological Transition and the Demographic Challenge, Teresa Ribera, has shown its rejection of the plan. “We are going to oppose forcefully, emphatically. It seems to us that for this reference it is better to do absolutely nothing,” Ribera denounced during his speech at the government control session held this Tuesday in the Senate.

Source: lainformacion.com

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