With gas and electricity prices rising at the end of summer, Europeans want to act to protect the purchasing power of households and the competitiveness of businesses. There is no question of adding a social uprising to the crisis caused by the war in Ukraine, as France experienced with the “yellow coats”, or of further increasing the risks of an already developing recession.
In recent days, proposals have been pouring in from across the Old Continent, and in Brussels, the commission has tested several scenarios. As European energy ministers are due to meet on Friday 9 September, Ursula von der Leyen, head of the European Commission, presented on Wednesday the lines of work to be presented to them on the occasion. As energy mixes vary from country to country, the discussions promise to be lively, but they will allow him to return in the coming days with a more detailed plan.
On the gas front, Angela Merkel’s former minister recalled that on July 26, twenty-seven agreed to cut their consumption by 15% by March 31, 2023 to prepare for a winter without Russian hydrocarbons. Today, the stocks are filled to 82% of their capacity, which, according to a commissioner, allows them “To cope with 2.5 months consumption in cold winter”. At the same time, Europeans turned to new suppliers (USA, Norway, Algeria, etc.) and accelerated the use of renewable energies.
‘Cutting Revenue’ from the Kremlin
So far, there has been no need to close factories or ration energy, although Moscow has drastically cut its supplies: before the war, the European Union (EU) relied on Russian gas for 10% of its energy; Today that number is down to 2.5%. But the price is high, and at the same time Moscow “Use gas as a weapon”, insists Ursula von der Leyen. Drought this summer has reduced hydropower production, and problems at several nuclear power plants, particularly in France, haven’t helped.
In this context, Ursula von der Leyen wants to limit the price of Russian gas imported by the EU. “Diminishing Income” of the serving Kremlin “Financing This Brutal War Against Ukraine”. Vladimir Putin warned on Wednesday morning: If such arrangements are made, “We don’t supply gas, oil, coal, heating oil – we don’t supply anything”. Nevertheless, in six months, the Europeans almost succeeded in eliminating Russian hydrocarbons, so the Commission decided to take this risk.
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