What’s cooking in Brussels: in the energy carousel

By Claire Stam
Schwarz-weiß Portrait von Claire Stam

Europe’s 27 energy ministers will meet today in the Justus Lipsius Building – not far from the famous (but not as good) Maison Antoine, which has already served countless “cornets de frites” to weary diplomats. For the Czech presidency, it will be the third extraordinary Council meeting since July 1. “And I’m not sure it will be the last, as the situation is not necessarily improving,” says a senior EU official.

What has Brussels abuzz is a letter to the EU Commission signed by 15 member states calling for a gas price cap. “I see that these 15 member states are growing increasingly nervous about what they perceive as a lack of response from the European Commission on this issue,” the official said. “But some member states continue to oppose this measure.” The countries in question are from Central and Eastern Europe, but also the very economic and political heavyweight Germany. So the official adds teasingly, “But we are doing everything to please Germany.”

But the German government fears that a gas price cap would create the wrong incentives. It favors a price brake, the toned-down version. And it is counting on the Commission to convince Paris and Co. to abandon its idea. As a compromise, the Commission now offers in its non-paper an extension of the Iberian model – that is, a price cap for gas used in power plants to generate electricity. Such a cap for power plant gas would have an immediate effect and would reach consumers, argued a senior Commission official.

The underlying strategy: A package of different measures for lower gas prices – for Russian imports, negotiations with other exporters and now also for power plants – are to act altogether like a general gas price cap, which the 15 states are calling for. Next week, the Commission plans to present an “action plan” – perhaps already on Tuesday, according to reports in Brussels.

France also calls for a gas price cap

What would the diplomatic energy tête-à-tête in Europe be without the Franco-German couplet? France is one of the signatories of the letter, even if Paris “understands our German partners perfectly well” that the already nervous markets should not be thrown even more out of balance. Mais, mais, mais: “The current regulation (the one on the negotiating table) does not answer the price issue at this stage,” says a government adviser in Paris. The goal: a price cap on gas, and not just on Russian gas.

Paris sees “a momentum among the member states that goes in this direction”. But the government also expressly supports the extension of the Iberian mechanism at the European level. This would make it possible “to avoid certain perverse effects, such as the excessive consumption of gas or the transfer of lower prices from one zone of Europe to another,” says the government advisor.

Macron’s opposition to the MidCat pipeline

Will a cap on gas prices be on the agenda for President Emmanuel Macron’s meeting with German Chancellor Olaf Scholz on Monday? Officially, the French leader is traveling to Berlin to take part in the German reunification celebrations, a meeting that will be complemented by a business lunch between the two heads of state. On the agenda are the energy crisis, the war in Ukraine and new sanctions against Russia.

Mais, mais, mais. Emmanuel Macron’s visit to Berlin comes two days before Olaf Scholz will head to Madrid. His trip has the unspoken goal of increasing pressure on Paris to resume construction work on the MidCat pipeline. This is the gas pipeline that is to connect the Iberian Peninsula with the rest of the European continent via a route through France. Critics accuse Paris of throwing obstacles in the way of the project to protect its nuclear industry.

It is worth remembering here that last Tuesday France’s Secretary of State for European Affairs, Laurence Boone, met with her Portuguese counterpart Tiago Antunes in Paris. A sign that Paris may have a change of heart? Definitely not. “Our position on MidCat has not changed,” the government adviser said. “Our conviction is unchanged that it is an extremely difficult construction site that will take six to seven years to complete. Also, the project would be expensive, about €100 million.”

The question is whether a compromise between a gas price cap and the resumption of MidCat construction work is possible.  

Trilogues on RED III and EED

Members of the European Parliament are not sleeping either. They will travel to Strasbourg, where the start of trilogues awaits them in particular, which will deal with the expansion of renewable energies in the European Union – or RED III in Brussels jargon – as well as energy efficiency (EED).

The trilogue on RED III is scheduled for October 6. As this is the first meeting, the various parties will present their respective positions, which means that the negotiations will not really begin until the negotiators meet again afterward. One particular point: rapporteur Markus Pieper (CDU) submitted amendments to the Commission’s text to ensure more flexibility in the awarding of permits. These amendments will be voted on next week in Strasbourg.

On the same day, also on October 6, the trilogue on the EED will be held. The debates that preceded the adoption of the text in the European Parliament showed a broad consensus, not only between the different political groups, but also between MEPs and the European Commission. In the words of one member of parliament, the unknown factor will be the Council’s position.

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