Belgium, (Brussels Morning Newspaper) The European Commission will proceed with the plan to introduce a new natural gas price benchmark.
EC President Ursula von der Leyen pointed out after the EU Council meeting on Friday that the move is aimed at reining in gas prices.
She reminded that the TTF benchmark largely reflects the price of gas imported via pipelines, while the market is moving away from piped gas and towards liquefied natural gas (LNG).
“The TFF no longer reflects the true market situation,” she pointed out and added that the EC will “develop a complementary new index to better reflect the LNG price situation.”
In the meantime, the Commission will introduce a correction mechanism, von der Leyen announced, “exactly to limit excessive episodes of gas prices and to make sure that there is a clear order in the build-up of the market.”
She added that the Commission will work with EU energy ministers to draw up a proposal to introduce the correction mechanism.
Joint gas purchase
Von der Leyen noted that bloc members largely agree on plans to allow companies to form consortia for the purpose of joint gas purchase, stressing that this would improve the EU’s position as a buyer.
Commenting on plans to limit the effect of rising gas prices on the price of electricity, von der Leyen stated “we had a frank discussion which further clarified, on the one hand, the opportunities and, on the other hand, highlighted the challenges.”
She announced the EC will analyse the impact of the proposal on EU member states that heavily rely on gas in electricity generation before it makes new proposals.
Another issue, she noted, is the potential export of subsidised electricity to non-EU members, which the Commission will also analyse and discuss with bloc members.
Von der Leyen announced plans to extend the Temporary Crisis Framework, under which EU member states can more easily support their economies in crises.
She pointed out that the EC plans to make roughly 40 billion euro available for bloc members to help their businesses and households cope with soaring energy prices and weather the crisis.
“More is needed to support small and medium companies but also larger industry to deal with the high energy prices,” she concluded.
