The European energy crisis puts EU Commission President Ursula von der Leyen under pressure to act: after initial hesitation, what can she do to counteract a hot autumn of protests and a cold winter to hold out?
Ursula von der Leyen is supposed to give something that is in short supply in Europe: gas. Her eternal rival Charles Michel, President of the European Council, is breathing down the neck of the European Commission President and demands that she not only make announcements but also present concrete plans as soon as possible on how the explosion in energy prices could be brought under control.
But first, the EU energy ministers will discuss what needs to be done on Friday. The ideas for this are manifold, subordinate to the respective national interest and – as is usual in the EU – differ widely. So far, Germany has not exactly been at the forefront of the movement.
Now save articles for later in “Pocket”.
Von der Leyen, who was initially also waiting, is now acting in an emergency and alarm state and speaks of “high speculative nervousness” on the electricity market and “astronomical” electricity prices. She proposes price caps for gas as well as a temporary skimming off of massive profits from those benefiting from the energy crisis.
Ever since she showed herself open to such radical ideas, it has been raining non-papers and other background papers in Brussels, the actors positioning themselves for a transformation of the energy market.
Von der Leyen’s otherwise rather secretive officials let their proto-ideas leak out across the board – a clear sign that they considered a test balloon necessary to gain an overview of the battle situation in the mined terrain of the European electricity and gas market.
“Each member state reacted differently,” says the co-chair of the group of CDU/CSU MEPs in the European Parliament, Angelika Niebler (CSU), describing the current state of the discussion. Measures already introduced in the national states were “as is so often the case, partly in the opposite direction”, complained her co-chairman Daniel Caspary (CDU).
France and Spain advocated market interventions at European level early on. Germany and Austria were more on the brakes. Italy, Spain, Greece and Romania already apply an excess profits tax aimed at siphoning off the exorbitant profits of crisis profiteers in the energy business.
France operates an electricity price cap and has to face massive blackout concerns – not because of the gas supply, on which the country hardly depends for electricity production, but because of the cooling and maintenance problems of the nuclear power plants there, which are responsible for the lion’s share of electricity production.
The electricity issue is now a case for the Defense Council in Paris – a question of national security. Spain has systematically relied on renewable energies, is only marginally dependent on Russian sources for its gas imports and sees opportunities to become a distribution center for natural gas in Europe with its half-dozen plants for processing liquid gas.
However, the necessary pipelines are still missing. In addition, the Spaniards, like the Portuguese, rely on state price caps.
Although the Poles have systematically decoupled from supplies of raw materials from Russia, they are still dependent on coal imports from there. And millions of Polish private households still heat with coal stoves. They are afraid of a cold winter.
Greece has postponed its coal phase-out, Germany reserves the right to use coal-fired power plants from the reserve to ensure security of supply. Bad times for von der Leyen’s former favorite project: the “Green Deal”, with which the EU wants to become climate-neutral.
In order not to get caught up in the European entanglement of desires and special interests from the outset, the EU officials initially did not really commit themselves to anything. Your first paper expressly did not reflect a final position of the Commission as a whole.
In addition to saving energy, they came up with a price cap for electricity that is not generated with gas. All those who currently generate electricity without gas and therefore quite cheaply, but who can demand the high prices of gas-fired power plants because of the European price coupling mechanism, should also give up their profits.
The proceeds should then benefit everyone in the EU countries who are particularly suffering from the fact that the price explosion is accompanied by an explosion in profits. Because the prices no longer reflect the actual costs in any way.
Surf tip: You can find all the news about the corona pandemic in the FOCUS Online news ticker
Charles Michel, President of the European Council, expected more from the Commission. In a mass media dump, a simultaneous interview with several European press organs, including the “Süddeutsche Zeitung”, he showed impatience with von der Leyen: “We have asked the Commission several times to put concrete proposals on the table.”
The Belgian, whose relationship with the head of the Commission is considered tense, instructed the German: “Proposals must be on the table as soon as possible – and I hope not only after the speech on the state of the European Union.”
This annual assessment is due September 14th. With a tight deadline, Michel’s demand came across as an ultimatum. The former Belgian prime minister likes to take it easy on von der Leyen, who has never been head of government.
It’s an open secret in Brussels that he considers himself to be far more competent than von der Leyen when it comes to leadership. Evidence for this self-assessment, however, is lacking.
The CSU economics expert in the European Parliament, Markus Ferber, also went to court sharply with von der Leyen. “If the Commission had already reacted in the spring, we would already be a good step further,” he judged.
It has now been six months for the EU to conclude new gas supply contracts with third countries. “The Commission was clearly asleep here.”
The President of the Commission promptly followed up and presented an emergency plan in Brussels on Wednesday, which the energy ministers are supposed to bow to on Friday.
This includes the idea of a solidarity levy for all high-earning energy companies as well as a price cap for gas deliveries from Russia – a step against which Russian President Vladimir Putin had expressly warned immediately before and threatened a complete export ban in this case. Von der Leyen was unimpressed by this.
The fact that Putin is manipulating the gas market has been nothing new for months, she explained defiantly. The President of the Commission also confirmed that her authority is also examining a price limit for all gas imports from the EU. She held back with specific numbers.
Suggestions are also coming from Prague, where tens of thousands of people have already taken to the streets because of high energy prices. The Czechs currently hold the rotating EU Council Presidency and have fed various models for price caps for gas and electricity from gas-fired power plants into the ongoing discussion.
The Czech Republic expects the energy ministers to make a pre-selection on Friday so that EU-wide solutions can be found as quickly as possible. Because it is “clear that the upcoming heating season will put the resilience of the EU energy market to the test”.
The Czech paper, which the news portal “Politico” first reported on, also mentions that energy poverty due to high consumer prices is no longer an exclusive issue for low-income sections of the population, but is eating away at the middle class.
The potential for protest is therefore high. Even more support for populists across Europe could be a result of the high energy bills. Parliamentary elections are coming up in Italy and Bulgaria. Extreme political forces that are also pro-Russian can count on chances of taking over the government there. The energy crisis is a campaign issue.
The EU Commission intends to present structural reform proposals for the electricity market that go beyond current emergency measures at the beginning of next year. Then, in the middle of winter, the willingness to make far-reaching changes may have grown everywhere.
Even in a cold winter, von der Leyen wants to remain tough on the aggressive imperialism of Russian President Vladimir Putin. It is important to “show Russia and the world that violating international rules is enormously expensive”. It is becoming increasingly clear that this costliness does not only work in Putin’s direction.
