Strasbourg, Mar. 14, (dpa/enr/GNA) - A forthcoming market reform is to drastically reduce the impact of gas on electricity prices, European Commission President Ursula von der Leyen said on Monday.
The reform’s aim is to ensure the benefits of renewable energy are brought “closer the consumers,” von der Leyen told dpa in an interview organized by the European Newsroom (enr).
After Russia cut supplies to the bloc, wholesale prices for gas in the European Union soared, ultimately leading to skyrocketing electricity prices and calls to reform the EU’s electricity market.
Von der Leyen said the bloc has a well-functioning spot market for wholesale gas but said the EU needs to improve conditions for long-term contracts.
A draft of the commission’s reforms, seen by dpa, would see more electricity traded through long-term contracts to protect business and households from volatile power prices.
Electricity in the European Union is mainly generated from fossil fuels, nuclear power or renewable energy sources.
To tackle price volatilities, the commission wants to promote long-term electricity contracts which provide power at a stable price to consumers and boost investments into generation capacities.
EU countries are to guarantee a minimum power price to generators for new investments, while revenues above a set threshold are to be funnelled back to consumers, according to the draft.
These incentives are to apply to all non-fossil-fuel power generation, including nuclear power plants.
Long-term contracts signed between power producers and customers are to be backed up by public guarantees to make them more viable.
The content of this article is based on reporting by correspondents participating in the European Newsroom (enr) project.
GNA