The European Commission will not set a price ceiling for gas from Russia

David JackySeptember 13, 2022

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The European Commission has decided not to set a price cap for Russian gas, but is pushing for a tax on “surplus profits” of energy companies, British media reported. In addition, the EU authorities want to limit the income of electricity producers. The European Commission intends to convene an emergency meeting by the end of September to develop measures to overcome the energy crisis.

The European Commission refuses the idea of setting a marginal price for gas from Russia. This is reported by the British newspaper The Guardian with reference to the draft resolution of the executive body of the European Union.

The EC proposes to impose a tax on excess profits for energy companies operating on fossil fuels. In addition, the EU authorities want to limit the income of electricity producers using renewable energy sources. Their incomes have recently risen sharply due to rising energy prices due to rising gas prices.

The European Commission wants to call this tax a “solidarity contribution”. The EU government intends to allocate the money received to “the most affected households and businesses.”

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According to the Guardian, the project proves that the European Commission has not received sufficient support from the EU member states in the issue of introducing a ceiling on prices for Russian gas. Austria, Hungary and Slovakia, among others, were against it – the authorities of these countries fear that if cap prices are introduced, the Kremlin will completely stop gas supplies. Russian President Vladimir Putin warned about such a step.

France and Poland have backed a cap on all imported gas, Germany fears disagreement in the European Union, and the Netherlands and Denmark fear any price cap.At the same time, most European countries support the income tax on energy companies.

On September 13, Spanish Deputy Prime Minister Teresa Ribera, Minister of Ecological Transition and Demographic Challenge, told TV3 that a new emergency meeting of EU energy ministers should be held by the end of the month. They will consider measures to overcome the energy crisis.

“We will have to see exactly what conditions the European Commission puts forward ahead of these final negotiations, ahead of the approval of the regulation on September 30,” the official said.

The energy crisis in the EU reached its peak in early July. Then there were the first interruptions in gas supplies from Russia, associated with problems with turbines for the Nord Stream pipeline. The mechanisms were not delivered from repair in Canada due to Western anti-Russian sanctions.

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The European Commission then called on European countries to prepare for a complete cessation of gas supplies by Russia and put into effect a plan to voluntarily reduce its consumption by all EU states by 15% by the end of March 2023.

Subsequently, EU energy ministers failed to agree on a price ceiling for Russian gas and instructed the European Commission to study the possibility of limiting prices for all types of gas.

The European Commission considers it important to introduce a ceiling on prices specifically for Russian gas in connection with military operations in Ukraine, TASS reports. At the same time, Brussels is worried that the introduction of a price ceiling “could undermine the security of supply.”