The European Commission is to develop a "more strategic" approach to external energy policy in the face of sky-high gas and electricity prices, the EC's energy commissioner Kadri Simson said Oct. 6.
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Register NowSpeaking in the European Parliament, Simson said the EC was looking at a number of proposals from member states on ways to improve Europe's gas supply security.
"We need to remain mindful of the importance of the geopolitics of energy and develop a more strategic approach to external energy policy," Simson said.
European spot gas prices have soared in recent weeks on intensifying winter supply concerns and lower-than-expected Russian imports.
S&P Global Platts assessed the TTF day-ahead price at Eur116.10/MWh on Oct. 5, up from just Eur13.08/MWh a year ago.
Simson, speaking ahead of a Parliament debate on high prices, said the current price shock could not be underestimated. "It is hurting our citizens, weakening our competitiveness and adding to inflationary pressure," Simson said.
"If left unchecked, it risks compromising Europe's recovery. There is no question that we need to take policy measures," she said.
New gas proposals
A number of member states have proposed new policy approaches to gas to combat the current crisis.
Finance ministers from five EU countries -- France, Spain, Greece, Romania and the Czech Republic -- have suggested that common EU guidelines on gas storage should be developed to mitigate price increases.
"In addition, we should better coordinate our gas purchases to increase our bargaining power," they said in a joint statement.
Simson said the EC would review all the proposals. "By the end of the year I will propose a reform of the gas market, and will review in that context issues around storage and security of supply," Simson said.
"More ideas have been put forward by the member states and members of parliament, such as forms of joint purchase of emergency gas reserves," she said.
"We're analyzing all of them," she said.
Simson also said European regulators needed to keep a close eye on market behaviors.
Russia's state-controlled Gazprom has come in for criticism because of its reluctance to send additional gas to Europe on top of its commitments under long-term contracts.
There have also been calls for the EC to investigate Gazprom for potential uncompetitive behavior, which Brussels is said to be looking at.
"Regulators have a role to play in market surveillance and prevention of uncompetitive practices," Simson said.
"It's essential to strengthen Europe's preparedness and resilience to price hikes."
'Toolbox'
Simson said the EC would publish next week its "toolbox" of measures that member states could take immediately to help mitigate the impact of high energy prices.
"In the Commission view, Europe must respond by delivering swift coordinated action at member state level, by leveraging the strength of the single market and by increasing its preparedness for future crises," she said.
"The Commission will present next week a toolbox of measures that member states can take in line with EU law, both short- and medium-term," she said.
These would, she said, include providing "targeted support to consumers, cutting energy taxes, and shifting charges to general taxation."
"These are all measures that can be taken very swiftly under EU rules," she said, adding that higher than expected revenues from the EU's carbon allowance trading scheme provided the space for doing so.