Fifteen countries, including Spain, pushed the European Commission to tighten the price ceiling on EU gas purchases. They proposed two correction options: set a dynamic cap or trigger it when the price hits 160 euros per megawatt hour (MWh), instead of the 275 euros Brussels had suggested.
The move forms part of an initiative led by Italy, Greece, Poland, and Belgium, with other nations joining the effort within two weeks. According to an unofficial document circulating among capitals and discussed for the first time at the ambassador level this Friday, the plan mirrors ideas raised by the energy ministers of Spain and Greece at the November 24 meeting. Teresa Ribera and Konstantinos Skrekas voiced similar approaches, which the Twenty-Seven failed to finalize then.
The first option sets a fixed ceiling of 160 euros per MWh, aligning with the Greek minister’s view of a realistic range of 150 to 200 euros per MWh to help keep prices in check. The second option introduces a floating cap, with a trigger level adjusted to attract international resources and be high enough to maintain supply. The current example cited is 160 euros per MWh.
This dynamic proposal has the backing of Spain, and it is viewed favorably by Poland as well. Polish diplomats are hopeful that the Twenty-Seven can reach an agreement at the upcoming extraordinary energy ministers meeting on December 13. They describe a strong, shared desire to move forward with a workable formula that could be accepted by most, if not all, member states [Citation: diplomatic channels, December briefing].
In private assessments, Polish officials say the dynamic formula offers significant flexibility. The main discussion has shifted from fixed numbers to the practical scope of application, with most countries signaling openness to flexible rules rather than rigid thresholds [Citation: ministerial summaries].
a common approach
Both proposals share common ground and foresee activation based on a political decision rather than a single technical trigger. The bloc expects this market correction mechanism to affect all futures products, not only the month-ahead contracts proposed by Brussels, and to apply to all contracts with physical or financial settlement conducted at any European trading venue.
Under this view, the cap would not be limited to the Dutch market price TTF, which currently serves as the EU reference. Instead, it would cover the majority of wholesale gas forward contracts traded across centers in Europe.
suspension traffic light
The bloc envisions a traffic-light approach to suspension conditions, with green indicating normal times, yellow granting discretionary leeway when certain thresholds are met, and red automatically removing the cap when higher thresholds are reached. The precise trigger for suspension would balance supply security with market stability, using objective cues such as LNG deliveries, demand trends, and the overall balance between supply and need as guiding factors.
These quantitative safeguards would help ensure security of supply while keeping the mechanism fair for all players. The overarching goal is to maintain reliability of energy access across the European market while keeping price volatility in check, even as global conditions shift.