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In absence of EU gas price cap, some countries plan to propose their own Reuters via biedexmarkets.com

In absence of EU gas price cap, some countries plan to propose their own By Reuters

© Reuters. FILE PHOTO: European Union flags flutter outside the EU Commission headquarters in Brussels, Belgium, September 28, 2022. REUTERS/Yves Herman

By Kate Abnett

BRUSSELS (Reuters) – A group of European Union countries will take the unusual step of drafting their own legislative proposal for an EU gas price cap, Poland’s climate minister said on Friday, amid scepticism from Brussels over the idea.

At a meeting on Friday, ministers from EU countries debated whether to cap gas prices to tame soaring energy costs and inflation – an idea that has support from at least 15 states, but which is opposed by others including Germany, Europe’s biggest gas market.

Polish climate minister Anna Moskwa said after the meeting – which did not yield a firm commitment from Brussels that the EU will propose a price cap – a group of countries would make a proposal of their own.

“We will prepare a legislative proposal when it comes to gas price caps,” Moskwa told Reuters in an interview. Poland, Belgium, Italy and Greece are among the states that will draft the proposal, she said.

“We will draft a proposal and we will present it to the Commission and I hope the Commission takes it,” she said.

EU policies are usually proposed by the European Commission, after which EU countries and the European Parliament negotiate and approve the final law.

Moskwa said the proposal would cover wholesale gas prices, and be ready for EU energy ministers to discuss at a meeting on Oct. 11.

The Commission said on Friday it would work with countries to develop ideas to tame gas prices ahead of a meeting of EU leaders next week, but did not explicitly agree to propose a broad gas price cap.

Brussels has warned that a wholesale price cap on all gas transactions – both imports and domestic trades – could require significant financial resources, and come with risks.

“This would clearly have an effect on prices, but would also effectively mean the suspension of EU’s gas market and create risks to security of supply,” EU energy commissioner Kadri Simson told a news conference after an EU energy summit.

“To take such a drastic step in a responsible way, a number of preconditions would be non-negotiable,” Simson said, adding that one condition would be a mandatory cut in EU gas demand, to ensure lower prices do not cause a spike in gas use.

Written by Paul Hough