Debate: Rising energy prices and market manipulation on the gas market
Date: TUESDAY, 8 MARCH 2022
Speaker: Kadri Simson
Language: EN

I will begin my remarks today on our relations with Gazprom. You asked me whether our rules on the certification of third countries operating in the EU are effective in ensuring our security of supply. This question is even more pertinent today. In this context, I very much welcome the German Government’s decision not to proceed with a certification process for Nord Stream 2, a project ultimately controlled by Gazprom. At the same time, I believe that our rules and third party certification are rigorous and effective, as it could not be demonstrated that granting certification would not put at risk the EU’s security of supply. Importantly, we are also closely monitoring Gazprom’s behaviour in the EU. As you know, we have opened an investigation into possible anti—competitive behaviour by Gazprom on the gas market and whether it has given rise to higher energy prices and this has been supported by the Ukrainian oil and gas company Naftogaz, and we are still in the fact—finding phase, but we are treating this investigation as an absolute priority. Staying with the topic of high energy prices and security of supply. You have rightly pointed out the low levels of gas storage available in Europe today. The good news is that thanks to the mild weather and increased LNG supplies, we expect to be on the safe side for this winter, but we are also getting ready for the next one. In December, we already made proposals to improve the use of storage in the EU and to create the option for joint purchase of reserves. However, we are not stopping there. Today, we have adopted a communication on more affordable, secure and sustainable energy. An important part of this communication is our approach to storage. The communication sets out EU—wide measures to fill storage before next winter. In April, we will bring forward a legislative proposal that will require the underground storage to be at least 90% full by 1 October each year. The proposal will also identify gas storage as critical infrastructure and tackle ownership risks. Beyond these immediate measures, we also need to look to the future. The communication adopted today sets out our vision to reach full independence from Russian gas before the end of this decade. Reducing our reliance on Russian gas includes continuing the work we have done so far on increasing LNG supplies, and in the medium term, more green energy, diversity of energy supplies and reducing energy demand. We remain firmly on the same course set by the Green Deal, but we aim to move much faster. On renewables, we must roll out renewable electricity in the sectors where gas dominates. This means insulating homes, installing heat pumps, solar PVs and speeding up the completion of wind parks and solar power plants across the EU. Part of this fast—tracking renewables is to look at what barriers still stand in the way. One of our biggest challenges in the renewables deployment today is permitting and authorisation for new projects, and we will propose guidance on this and introduce the concept of go—to areas where renewables development will be particularly accelerated. To support this colossal shift in our energy system, we also need the infrastructure in place to match this new volume of renewables. That’s why in the communication adopted today, we make a strong call for interconnections and trans—European networks adapted to this new reality. And similarly, consumer empowerment and protection will be key to helping them manage the challenges of even higher and volatile prices.  Energy communities will also play an increasing role, allowing citizens to come together to collectively produce and consume electricity, and the prerequisite for this energy system is the full implementation of the Clean Energy Package and the Electricity Directive. This sets the framework for the rollout of smart meters, of demand—side response and for aggregators who bundle the actions of many small consumers to be big enough to act on the market. Let me finish by saying that we have thoroughly analysed the reasons for the dramatic rise of energy prices at many points along the road. Today’s communication takes account of how the energy landscape has changed since our October toolbox, including the Russian aggression in Ukraine. The communication we have adopted today is also a way to be fully transparent with EU citizens about the causes behind these dramatic increases that they are seeing in their monthly bills and our proposed solutions to address them. At the same time we look forward to continuing the dialogue with the Parliament and Council and provide further explanations if they are needed.