EU Energy Policy Conversations Get Heated
Next Friday will officially mark one year since Russia invaded Ukraine, forever shifting global politics and the energy sector. Since then, there have been some unilateral policy efforts by the EU bloc to adapt and secure energy supplies.
But it’s not all Champagne and caviar
There are some lingering sore points. For one, it’s estimated Europe has now spent €800 billion in costs related to the energy crisis. According to Reuters, Germany spent the most on subsides totaling €270 billion, followed by Britain, Italy, and France, who each spent just under €150 billion. That’s a whole lotta moolah that can buy more than just a month in Versailles.
- For context, Europe’s total cost to shield households and businesses from energy prices is now more than America’s entire Inflation Reduction Act, a set of policies the continent will have to match to avoid falling behind on green industries.
Power pricing: Following the run up in electricity prices last year, EU countries are looking to make major reforms to the way the price of power is set. Prices are currently set to the marginal cost power plant available, a key contributor to the run up in power prices last year.
Reforms are proving challenging, though, with deep divisions between groups of countries with different electricity mixes.
Looking ahead: Things could get more complicated this month. For one, Russia is expected to launch its spring offensive next Friday for a big push against Ukraine, not a very romantic anniversary gift.
To top it off, Pulitzer-prize-winning journalist Seymour Hersh just published a detailed report based on insider sources accusing the Americans – not the Russians – of blowing up the Nord Stream pipelines.