Brussels (Brussels Morning) â The European Parliament approves reforms aimed at enhancing energy security, protecting consumers from price fluctuations, creating a hydrogen market, and allowing countries to restrict Russian gas imports.
MEPs have passed a package of gas and electricity market reforms aimed at strength energy security, protecting vulnerable consumers from absurd price fluctuations as witnessed during the 2022 energy crisis, and creating a new hydrogen market, as well as permitting individual countries to prohibit imports of Russian gas â with a more complete prohibition on the cards due to incoming constraints imports with excessive upstream methane leakage.
Can the EU Parliament Protect Consumers from Fluctuations?
According to Euronews, with wide cross-party backing for a political deal struck with EU governments in December, the European Parliament has supported measures such as promoting the production of biomethane, generally from waste organic matter, in line with the EU Commissionâs goal of annual production of 35 billion cubic metres a year by 2030.
This, along with efforts to promote the development of a hydrogen distribution network, is planned to decarbonise Europeâs energy system, and certain heavy industries currently reliant on fossil energies, which cannot readily be electrified. The ruling also aims to increase the production of âlow-carbonâ gas, which can be directed to fuels produced from fossil gas in a mixture with carbon capture and storage (CCS) technology and provides the European Commission a year to come up with a workable cluster of criteria to apply to such products.
Are Russian Gas Imports Restricted by the EU?
In reaction to demands from several governments, the legislation also permits governments to unilaterally thwart imports of gas from Russia or Belarus, by limiting up-front bidding for ability at entry points into the EU, which could be channels or liquefied natural gas (LNG) terminals. With opposition from heavily dependent countries like Hungary, Slovakia and Austria, there is no prohibition on Russian gas imports, and LNG deliveries have grown since the invasion.
Did the EU Parliament Address Elevated Electricity Bills?
The electricity market reforms contained several responses to the elevated electricity bills seen during the energy crisis of 2022 when the EUâs market design represented the wholesale cost of a megawatt hour and tracked the price of gas even when the grid was full of theoretically free renewable power. Buyers will have the right to choose a fixed-price contract, and electricity providers will be banned from cutting off vulnerable customers who cannot bear them during times of high prices.
The entire electricity market pricing system stays in place, however, but the EU will be capable of declaring a regional or EU-wide electricity price situation, allowing states to temporarily cap prices for small businesses and energy-intensive industries. The reform also grows to 2028 a derogation from a CO2 emissions limitation for electricity generation that can obtain state support through so-called capability mechanisms, effectively permitting state-subsidised coal- and gas-fired power plants. The law also directs the use of two-way agreements for differences in state support systems for renewable and nuclear power, a response to the huge windfall profits made by some power companies.
Is Methane Emission Regulation Strengthened by EU
The parliament also agreed on a new law setting limitations on direct methane emissions from the oil, gas and coal sectors, and from biomethane once it is infiltrated into the gas network. Natural gas is a fossil form of methane, a gas which in itself has an international warming potential many times that of the carbon dioxide delivered when it is burnt and is calculated to be behind nearly a quarter of the continued global temperature rise.
Operators in the fossil fuels sectors protected by the law will have to propose a methane leak detection and repair agenda within nine months and launch a first leak detection and repair survey within a year. It also prohibits the venting and flaring of methane, including from coal mines, by 2027.Â
