The European Commission has today proposed the outline of a plan to make Europe independent of Russian fossil fuels well before 2030, starting with the gas, in light of Russia's invasion of Ukraine.
The plan also outlines a series of measures to respond to rising energy prices in Europe and to replenish gas stocks for next winter. Europe has been facing rising energy prices for several months, but supply uncertainty is now exacerbating the problem. REPowerEU will seek to diversify gas supplies, accelerate the deployment of renewable gases and replace gas in heating and power generation. This can cut EU demand for Russian gas by two-thirds before the end of the year.
Commission President Ursula von der Leyen said: “We must become independent of Russian oil, coal and gas. We simply cannot rely on a supplier that explicitly threatens us. We must act now to mitigate the impact of rising energy prices, diversify our gas supply for next winter, and accelerate the transition to clean energy. The sooner we switch to renewables and hydrogen, combined with more energy efficiency, the sooner we will be truly independent and in control of our energy system. I will discuss the Commission's ideas with European leaders in Versailles later this week, then work on their rapid implementation with my team. »
M. Frans Timmermans , Executive Vice President for the European Green Deal, said: “It is time we tackled our vulnerabilities and rapidly became more independent in our energy choices. Let's dive into renewable energy at lightning speed. Renewables are a cheap, clean and potentially endless source of energy and instead of funding the fossil fuel industry elsewhere, they are creating jobs here. Putin's war in Ukraine demonstrates the urgency of accelerating our transition to clean energy. "
Energy Commissioner Kadri Simson said: “Russia's invasion of Ukraine has aggravated the security of supply situation and raised energy prices to unprecedented levels. For the remaining weeks of this winter, Europe has sufficient quantities of gas, but we must urgently replenish our reserves for next year. The Commission will therefore propose that by October 1, gas storage in the EU will be filled to at least 90%. We also presented price regulation, state aid and tax measures to protect European households and businesses against the impact of exceptionally high prices. »
Emergency measures on energy prices and gas storage
The Commission's 'Energy Price Toolkit' of last October helped Member States to mitigate the impact of high prices on vulnerable consumers and it remains an important framework for national measures. Today, the Commission is presenting Member States with additional guidance, confirming the possibility of price regulation in exceptional circumstances and setting out to consumers how Member States can redistribute to consumers the revenue from high profits in the energy and emissions trading. EU State aid rules also offer Member States the possibility to provide short-term support to companies affected by high energy prices and contribute to reduce their exposure to energy price volatility over the medium to long term. Following a consultation on targeted amendments to the State Aid Guidelines for the Emissions Trading Scheme, the Commission will also consult Member States on the necessity and scope of a new temporary framework for state aid in the event of a crisis intended to grant aid to businesses affected by the crisis, in particular those facing high energy costs.
The Commission intends to present a legislative proposal by April requiring that underground gas storage across the EU is filled to at least 90% of capacity by October 1 of each year. The proposal would involve the monitoring and enforcement of fill levels and establish solidarity agreements between Member States. The Commission is continuing its gas market investigation in response to concerns about possible distortions of competition by operators, notably Gazprom .
To deal with soaring energy prices, the Commission will examine all possible options for emergency measures to limit the contagion effect of gas prices on electricity prices, such as temporary price limits. It will also assess options to optimize the design of the electricity market taking into account the final report of the EU's Agency for the Cooperation of Energy Regulators (ACER) and other contributions on the advantages and disadvantages of alternative pricing mechanisms to keep electricity affordable, without disrupting supply and new investments in the green transition.
REPowerEU – eliminating our dependence on Russian gas before 2030
Phasing out our dependence on fossil fuels from Russia can be achieved well before 2030. To achieve this, the Commission proposes to develop a REPowerEU plan which will strengthen the resilience of the EU-wide energy system based on two pillars: diversifying gas supplies, through higher imports of liquefied natural gas (LNG) and gas pipelines from non-Russian suppliers, and higher volumes production and import of biomethane and renewable hydrogen ; and reducing the use of fossil fuels in our homes, buildings, industry and electricity system more rapidly , by improving energy efficiency , increasing renewable energy and electrification, and addressing infrastructure bottlenecks .
Full implementation of the Commission's "Fit for 55" proposals would already reduce our annual fossil gas consumption by 30%, or the equivalent of 100 billion cubic meters (bcm), by 2030. With the measures of the REPowerEU plan, we could phase out at least 155 billion cubic meters of fossil gas use, equivalent to the volume imported from Russia in 2021. Almost two-thirds of this reduction can be completed within a year , ending the EU's overreliance on a single supplier. The Commission proposes to work with Member States to identify the most appropriate projects to achieve these goals, building on the extensive work already carried out under the National Recovery and Resilience Plans.
Background
The new geopolitical and energy market reality compels us to dramatically accelerate the clean energy transition and increase Europe's energy independence from unreliable suppliers and volatile fossil fuels.
After the invasion of Ukraine, the case for a rapid transition to clean energy has never been louder and clearer. The EU imports 90% of its gas consumption, with Russia supplying around 45% of these imports, at varying levels from one Member State to another. Russia also accounts for around 25% of oil imports and 45% of coal imports.
The Commission's October 2021 Energy Price Toolkit has helped citizens and businesses cope with high energy prices over the past few months. 25 Member States have adopted measures in line with the toolkit which are already reducing the energy bills of more than 70 million residential customers and several million micro, small and medium-sized enterprises.
The Commission continues to work with its neighbors and partners in the Western Balkans and the Energy Community, who share the EU's fossil fuel dependencies and exposure to price increases, while committing to achieve the same long-term climate goals. For Ukraine, Moldova and Georgia, the EU stands ready to provide support to ensure reliable and sustainable energy. Ongoing efforts to ensure an emergency synchronization of the Ukrainian and Moldovan power grids with the continental European grid are a clear sign of this commitment.
Posted on 2022-03-09 11:28
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