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EU leaders agree deal to tame soaring energy bills

21.10.2022 09:30
European Union leaders have reached an agreement to protect citizens and businesses from rising energy costs driven by Russia’s invasion of Ukraine, officials have announced. 
Charles Michel.

The deal was struck in the early hours of Thursday at a summit in Brussels, Belgium, after 10 hours of talks between EU heads of state and government, including Poland’s Prime Minister Mateusz Morawiecki, public broadcaster Polish Radio’s IAR news agency reported.

EU to adopt temporary price cap on gas 

The agreement foresees an emergency cap on the price of gas, a measure advocated by 15 member states including Poland and France, but initially opposed by Germany and the Netherlands, officials said.

Details are expected to be hammered out by energy ministers and the EU’s executive, the European Commission.

European Council President Charles Michel said in a tweet: “We have a deal on energy. There is a strong and unanimous commitment to act together, as Europeans, to reach three goals: lower prices; guarantee the security of supply; and continue to work to reduce demand.”  

Meanwhile, European Commission President Ursula von der Leyen told reporters that the deal represented “strategic guidance” and “a very good and solid roadmap” for further work on energy prices, Polish state news agency PAP reported.

'Temporary dynamic price corridor'

EU leaders called on the European Commission and member states to “urgently submit concrete decisions” on a range of measures, including “a temporary dynamic price corridor on natural gas transactions" and “a temporary EU framework to cap the price of gas in electricity generation," according to the summit’s Conclusions on Energy and Economy published on Thursday night.

Voluntary plan to jointly purchase gas

EU countries also agreed on a voluntary plan for the bloc to jointly purchase gas, after Hungary opposed a mandatory approach, the politico.eu news service reported.

The summit’s conclusions called on the EU executive and member states to “urgently submit concrete decisions” on “voluntary joint purchasing of gas ... according to national needs, and the speeding up of negotiations with reliable partners to seek mutually beneficial partnerships by exploiting the Union’s collective market weight.”

This means a new mechanism for EU gas companies to band together into buyers’ cartels to purchase gas on the international market in time for next year’s storage-filling season, according to politico.eu.

EUR 40 bn for households and businesses

Von der Leyen announced that Brussels would also release EUR 40 billion to allow member countries to help “households or small and medium-sized companies” through the energy crisis, the IAR news agency reported.

Overall, the European Council has agreed that “in light of the ongoing crisis, efforts to reduce demand, to ensure security of supply, to avoid rationing, and to lower energy prices for households and businesses across the Union need to be accelerated and intensified,” the conclusions said.

Support for Ukraine, sanctions on Russia, relations with China

On Friday, EU leaders are expected to discuss “the latest developments in Russia’s war of aggression against Ukraine, including its consequences in Ukraine and elsewhere” as well as “continued EU support for Ukraine” and fresh sanctions against Russia and its close ally Belarus, the IAR news agency reported.

Poland’s Morawiecki said on Thursday that Russia’s actions in Ukraine were “increasingly terrorist in nature,” adding that Poland would press for more sanctions, including restrictions on liquefied petroleum gas (LPG) imports from Russia and a ban on the sale of drones to Russia, according to IAR.

Another key topic on Friday will be EU-Asia relations, including “a strategic discussion on China,” according to officials. 

Friday is day 240 of the Russian invasion of Ukraine. 


Source: IAR, PAP, consilium.europa.eu, politico.eu