Measures to reduce energy prices
The Energy Council agreed on a Regulation on an emergency intervention to address high energy prices earlier today which outlines four key measures:
- Electricity demand reduction. Voluntary reduction target of 10% of gross electricity consumption and a mandatory reduction target of 5% of the electricity consumption in peak hours.
- Cap of market revenues at 180 euros/MWh for renewable energy sources, nuclear, lignite electricity generators, including intermediaries. Member States agreed to use measures of their choice to collect and redirect revenues towards final customers.
- Solidarity levy for the fossil fuel sector. Member States agreed to set a mandatory temporary solidarity contribution on the profits of businesses active in the crude petroleum, natural gas, coal, and refinery sectors.
- Retail measures for SMEs. Member States may temporarily set a price for the supply of electricity to small and medium-sized enterprises to further support SMEs struggling with high energy prices.
Since a differentiated approach for Malta would have only limited effect on the internal energy market, Malta can apply the provisions related to the reduction of its gross electricity consumption during peak hours and the cap on market revenues on a voluntary basis.
More information can be found here: Council agrees on emergency measures to reduce energy prices – Consilium (europa.eu)
State of the Union address by European Commission President
Earlier this month, Commission President Ursula Von der Leyen gave the annual State of the Union address, outlining the EU’s current priorities and giving an outlook for 2023. The President praised the solidarity throughout the EU after the invasion of Ukraine and described Vladimir Putin’s war as a war against all our values, our economy, our democracy, and our European Unity. She claimed that Russia’s industry is in tatters because of EU sanctions, and that they are here to stay. The EU wants to further integrate Ukraine into the EU’s single market and the electricity market.
On the Conference of the Future of Europe, the President endorsed the idea of a Treaty change ad called for a European Convention. Please note that this would be possible if supported by a qualified majority of EU member states. She also called for a European Political Community which would promote dialogue among like-minded countries beyond the EU member states. She also committed a clear vision for the Western Balkan countries to join the EU.
The focus of the speech on the economy related to the energy crisis. She announced an EU-Norway task force to secure future deliveries as the EU looks to become completely independent from Russia. She called for a real overhaul of the energy market, including a shift to bring hydrogen in the mainstream. For this purpose the EU will create a European Hyrdogen Bank that will be setup with a capital of Eur3 billion.
She also acknowledged that fiscal rules will need to adapt to the new economic reality and announced an upcoming reform of economic governance with more flexibility expected to the current Stability and Growth Pact that will be geared more towards investment. Other initiatives mentioned were the BEFIT to remove obstacles to the growth of SMEs, a revision of the late payments directive, and a European Critical Raw Materials Act to boost the EU’s open strategic autonomy.
More information can be found here: State of the Union (europa.eu)
Council Recommendation on Minimum Income
The European Commission published a Council Recommendation setting out how Member States can modernise their minimum income schemes to make them more effective, lifting people out of poverty, while promoting the labour market integration of those who can work. The recommendation focuses on improving the adequacy of income support; improve the coverage and take-up of minimum income; improve access to inclusive labour markets; improve access to enabling and essential services; promote individualised support; increase the effectiveness of governance of social safety nets at EU, national, regional and local level; as well as monitoring and reporting mechanisms. Specific actions are recommended for each of the above categories.