Commission proposes emergency EU electricity market intervention
Measure in Brief
The Commission has proposed an emergency Council Regulation under Article 122 of the Treaty introducing exceptional electricity demand reduction obligations, a temporary €180/MWh cap on inframarginal revenues, a temporary solidarity contribution on excess profits in the oil, gas, coal and refinery sectors, and measures allowing below-cost regulated electricity prices and their extension to small and medium-sized enterprises. Member States must identify the 10% of hours with the highest expected price and reduce consumption by at least 5% during those peak hours and aim to reduce overall demand by at least 10% until 31 March 2023.
Who Is Affected
The measures affect Member States and electricity consumers including households, small and medium-sized enterprises, hard-hit companies and energy-intensive industries, as well as inframarginal producers such as renewables, nuclear and lignite and fossil-fuel and refinery firms whose excess 2022 profits may face the solidarity contribution. Member States that are net importers with at least 100% imports are encouraged to conclude bilateral revenue-sharing agreements by 1 December 2022.
What Comes Next
The Commission’s proposal for a Council Regulation will be considered by Member States, with demand-reduction timelines to 31 March 2023 and bilateral revenue-sharing agreements envisaged by 1 December 2022.
Sources
Official Documents
- Energy prices: Commission proposes emergency market intervention to reduce bills for Europeans The Commission proposed a Council Regulation establishing emergency electricity market interventions, including peak-hour demand reductions, an inframarginal revenue cap, and a solidarity tax on excess fossil-fuel profits, to lower energy bills for consumers.
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