EU puts an end to its electricity market crisis measures (updated)

Fossil

05/06/2023 16:11

(Adds details, context)
       BRUSSELS, June 5 (Reuters) - The European Commission
said on Monday it had decided not to prolong emergency measures
introduced last year to shield consumers from soaring energy
prices, adding those measures had helped to contribute to a
calming of European electricity markets.
    At the end of 2022, the 27-member European Union was in the
midst of an acute energy crisis fuelled by Russia's invasion of
Ukraine, with member states then ploughing hundreds of billions
of euros into tax cuts, handouts and subsidies to tackle the
crisis.
    "The Commission confirms that it will not propose a
prolongation of these crisis measures," it said in a statement,
reminding these included electricity demand reduction measures,
revenue caps for power plants and retail price setting rules.
    Concerning gas, European Union countries agreed end March to
extend for the next 12 months, until March 2024, a voluntary
target to curb their gas demand by 15%.
    The Commission added that electricity prices have now
decreased to less than 80 EUR/MWh and gas prices have not only
fallen but also stabilised, to the extent that the electricity
price spikes observed throughout 2022 are considered "less
probable to occur in the upcoming winter".
        "EU countries reported that they broadly respected the
binding target of reducing electricity consumption by 5% at peak
hours – an important step for easing price pressure. "
  
    The Commission also said that some aspects of the emergency
measures had been included in its proposals for longer-term
structural adjustments in the electricity market design.
    Those proposals aim to try to increase the use of
fixed-price power contracts, shield consumers from price spikes
and speed up the shift to renewable energy.

 (Reporting by Benoit Van Overstraeten; Editing by GV De Clercq)
 ((benoit.vanoverstraeten@thomsonreuters.com; +33149495339;))