Most EU countries request a dynamic cap or reduce the gas limit proposed by Brussels to 160 euros

15 countries that asked the European Commission to limit gas purchase prices in the European Union (EU), including Spain, proposed two alternatives to this correction mechanism: set a dynamic limit or have it activated when 160 Euro per megawatt hour (MWh) is reachedCompared to the 275 euros recommended by Brussels.

The offer is part of Initiative of Italy, Greece, Poland and Belgium According to diplomatic sources, other countries joined until it reached two weeks later.

According to the unofficial document that circulated between the capitals and that 27 discussed for the first time at embassy level this Friday, it consists of two options that coincide with the proposals made by the Ministers of Energy of Spain and Greece, Teresa Ribera and hers, respectively, at the meeting on 24 November, which ended without an agreement between the Twenty-seven. Konstantinos Skrekas.

The first of the alternativesfixed limit of 160 euros per megawatt hour (MWh) and falls within the range set by the Greek minister, who advocated a ceiling of 150 to 200 euros per megawatt hour, a “realistic” price to keep prices down.

On the other hand, it also turns out a floating cap with a global introductory level as it goes into effect, which must be set to a level sufficient to attract international resourcess, for example, is currently 160 euros per megawatt hour (MWh).

This dynamic offer is favored by countries such as Spain. but also, like Poland, which is optimistic about reaching an agreement among the Twenty-Seven within the framework of the next extraordinary meeting of energy ministers on 13 December, there will be “a strong desire to achieve it and will be shared by most, if not all”.

In fact, Polish diplomatic sources “Most, if not all, Member States agree that the dynamic formula is very flexible.” and “the main point of discussion has moved from number to application scope”.

a common approach

However, both alternatives are a series of common approaches and, if implemented, these countries demand activation based on a political decision without a specific trigger.

The bloc also considers that this market correction mechanism should affect all futures products – not just the month-ahead ones proposed by Brussels – and all contracts with physical or financial settlements issued at any trading center by Europeans.

In this way andThe cap will not apply only to the Dutch market price TTF.It is the reference for the EU, but will cover most of the centers where it is possible to enter wholesale gas forward contracts.

suspension traffic light

The block wants the mechanism to be governed by a ‘traffic light’ approach regarding suspension conditions, which runs during normal times (green), gives discretion when certain thresholds are reached (yellow), and is automatically removed when other thresholds are reached. higher thresholds (red).

Meanwhile, quantitative criteria to ensure security of supply, such as the delivery of liquefied natural gas, the development of demand, and the global balance between demand and supply, should be the main drivers of suspension conditions.

Source: Informacion

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