A gas price cap agreement reached at yesterday’s Energy Council also promises to propel a series of significant energy-sector measures such as collective gas purchases, solidarity mechanisms, a new benchmark and fast-track procedures for renewable energy units in the EU.
EU energy ministers agreed to trigger a cap if prices exceed 180 euros per MWh for three days at the Dutch TTF index, which serves as the European benchmark.
Member states that have supported the lower-level gas price cap agreed to, including Greece, wanted the series of measures incorporated as one package alongside the gas price cap. These measures are expected to be shaped and implemented swiftly in order to protect the EU’s natural gas supply security and contain natural gas price levels.
The European Commission has proposed collective gas purchases representing at least 15 percent of the EU’s gas storage capacity, the intention being to bolster the bloc’s negotiating power.
The Brussels measures also call for improved solidarity mechanisms to counter any possible supply shortages; the establishment of a new LNG pricing index by March, 2023, as an alternative benchmark to the TTF; as well as prioritizing RES projects and simplifying green energy licensing procedures to reinforce Europe’s energy independence.