(Finance) – The High Representative for the EU’s Common Foreign and Security Policy, Josep Borrell, said today in Luxembourg, during the press conference following the Foreign Affairs Council, that the Commission “has already decided” to reform the wholesale price formation system in the European electricity marketbased on a marginal model that currently depends on the price of gas.
“In the situation current rise in energy and hydrocarbon prices which is transmitted to electricity prices, I am pleased to see “, Borrell observed,” that the European Commission has already taken the decision to build a new system for the formation of electricity prices in the EU that no longer makes it dependent on the price of gas. This is part of our fight against climate change: establishing reasonable rules and having a good system for fixing electricity prices. ” price formation in the electricity market, nodespite the requests to this effect from various governments (Italy, France, Spain, Portugal and Greece).
Then, quite unexpectedly, last June 8, the President of the Commission, Ursula von der Leyen, had opened to reform, during a debate in the plenary of the European Parliament in Strasbourg, admitting that the structure of the electricity market was designed as it was needed 20 years ago, when renewables had yet to be introduced, and that today the market is completely different and no longer works. Today it is gas, the most expensive source, which defines the price of electricity while renewables cost less. The Commission, announced von der Leyen, has therefore taken on the task of reforming the market to adapt it to the new reality, but, he warned, “it will take time”. On June 16, then, the European Commissioner for Energy, Kadri Simson, announced in a hearing in the European Parliament that the Commission will launch “an impact assessment, with broad consultation, on optimizing the functioning of the European electricity market, including the impact of gas prices on electricity prices “.