The EU must be ‘very cautious’ about capping fuel costs, warns German minister

The European Union must be “very cautious” about imposing a worth cap on all fuel imports coming into the bloc, Anna Lührmann, Germany’s minister of state for Europe, has warned.

The thought of an EU-wide fuel cap has gained traction in current weeks after costs broke new data in August and pushed electrical energy payments to unsustainable highs.

Italy, Belgium, Sweden and Poland are amongst these backing the initiative, which continues to be in its early phases.

However Germany, the EU’s largest financial system and fuel client, stays opposed, believing the measure may scare suppliers away and endanger the bloc’s safety of provide.

“The difficulty with the value cap is that: in the event you introduce a worth cap, because the EU unilaterally, and all the opposite shoppers all over the world do not do it, then the fuel will go to different shoppers and thus we would have a scarcity in fuel provides,” Lührmann informed Euronews in an interview.

“So, I believe we must be very cautious with these sorts of worth caps and do every thing we are able to to diversify our provide construction. That can even assist to handle the value points.”

Lührmann stated that, as a substitute of imposing a horizontal worth cap on fuel imports, the EU ought to have interaction immediately with its important fuel suppliers and negotiate decrease costs.

“It could be necessary to debate with particular person fuel suppliers, equivalent to Norway, methods to scale back the value as a result of they’ve an enormous curiosity within the European Union and the European market,” the minister stated.

“However total, there is not any different to really discovering the methods of how we are able to use power extra effectively and the way we are able to construct up a sustainable power system [based] primarily on renewable sources.”

Norway, which this 12 months changed Russia because the EU’s main fuel provider, has stated it’s “sceptical” a couple of worth cap however open to discovering options. The nation’s commerce surplus reached an all-time excessive of just about €20 billion in August, principally as a result of hovering fuel costs.

The European Fee is finding out the measure’s potential dangers, together with its impression on the liquefied pure fuel (LNG) market, and has not but tabled a proper proposal for ministers to debate.

In the intervening time, the EU’s emergency package deal will concentrate on three parts: electrical energy financial savings throughout peak hours, a cap on the surplus revenues made by non-gas energy vegetation (equivalent to wind, photo voltaic and nuclear) and a windfall tax on the excess income reaped by fossil gas corporations.

The general purpose is to curb demand whereas elevating extra cash for governments.

“We will use these surpluses and provides them again to shoppers, to residents, significantly these in want, in order that we cut back the costs for them,” Lührmann stated.

The minister, who belongs to The Greens, stated the brand new EU measures are a “superb” start line however must be complemented by an additional effort on the nationwide degree to spice up renewables.

“I am fairly satisfied that if we comply with them by means of,” she stated, “we [can] handle to get by means of this winter and in addition create circumstances to make our economies sustainable with out Russian power provides.”

EU power ministers are set to satisfy on 30 September to debate and inexperienced mild the emergency measures.

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