Spain and Portugal have reached an agreement with the European Commission to separate the gas price from the electricity bill. The two countries have offered 30 euros per MWh, but the agreement with Brussels means, starting from 40 euros, an average of 50 euros over the period of application of the measure: 12 months.
Vice President Teresa Ribera and her Portuguese counterpart José Duarte Cordeiro announce a “political agreement” after meeting with European Union Vice President for Competition Margrethe Vestager. From now on, technical details are expected to close. Ribera counted on “the support of the Commission for immediate implementation”.
Ribera hopes to finalize the agreement “in the coming days”, which will be approved by the “Council of Ministers next week”. According to the vice president, this measure “will enable industrialists, domestic consumers, to benefit from this reduction in requests in the wholesale market. This agreement protects us from shocks and rising gas prices.”
Tuesday’s agreement comes a month after the agreement between the 27 EU heads of government. A political agreement that has yet to materialize, because that day in Brussels on March 25 was an important step in the quest of Spain and Portugal to confront the energy crisis. But there were minor moments, negotiations with the European Commission and pressure from energy companies to prevent restrictions on gas supplies.
“This is an operational development that materializes the two paragraphs of the conclusions of the European Council,” said Ribera, who is awaiting final approval from Brussels during this week: “The idea is for it to go through the Council of Ministers next week and apply to the May bill. Low interconnections and a large amount of renewable energy made this agreement necessary. The European Commission has asked us to be flexible regarding accession to France, but committed to being a more active player in advancing the goals of accession. From now on, when the debate arises on how to develop the structure of the European electricity market, the importance of interconnections becomes even more important than it has been until now.”
Cordeiro spoke of the need, in his opinion, for the European Commission to “rethink” the current electricity pricing system, although this measure is temporary. “Either pricing is being adjusted,” or the interconnections are getting stronger.
On March 25, Prime Minister Pedro Sanchez reached a political agreement recognizing a “special regime” for the Iberian Peninsula due to its poor connectivity with the rest of the EU, according to the European Union president. Commission, Ursula von der Leyen. But this specificity as such was not mentioned in the conclusions agreed upon at the European Council, and, in any case, the leaders handed over to the European Commission to give the go-ahead to transfer the European singularity to a gas ceiling to reduce the electricity bill.
I mean, it’s been a long road. Both Sánchez and Portuguese Prime Minister António Costa spoke of “urgency” that day. And it is true that the conclusions urged the European Commission to take a swift decision on the Iberian proposal, which was presented at the end of March. But right now the implementation of the agreement seems closer.
“One of the delicate issues and how this mechanism can affect France,” said Ribera: “It is here that the Commission asked for flexibility in order not to limit the borders. It is important to open up a discussion on how to develop the European market so that it adapts to our needs.”
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