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    France supports extending the "Iberian mechanism" to the rest of the EU to lower electricity prices


    September 30, 2022 - CE Noticias Financieras

     

      BRUSSELS, 30 (EUROPA PRESS)

      "I know there are reticence about this mechanism, but we have worked technically. We can do to prevent it from causing excess gas consumption and we know that it can be put in place very quickly," the minister told the press upon her arrival at a meeting of EU energy ministers.

      Pannier-Runacher insisted that the system known as the 'Iberian exception' is "the type of signal that European companies need" in the current context and for this reason she is confident that the Community bloc will work "in this direction".

      The French minister supported the idea of an Iberian mechanism "extended to the whole" of the European Union because this would enable action to be taken to reduce the price of electricity "quickly".

      The ministers meeting in Brussels have reached a political agreement to implement urgent measures to contain prices in the European Union energy market, for example with a 5% reduction in electricity consumption at peak times, a tax on fossil fuel companies and a ceiling of 180 euros/Mwh for infra-marginal energy companies in the wholesale market.

      They also have on the agenda to discuss the latest working document presented by the European Commission to move towards other initiatives that generate more doubts and require more work for consensus, including generalizing throughout the EU a system similar to the one already applied in the Iberian Peninsula.

      "Based on the experience of the Member States, the Commission is ready to discuss the development of a temporary European framework to limit the influence of high gas prices on electricity price formation," the Community services indicate in their informal proposal.

      "One option could be to limit the price of gas in electricity generation to a level that helps to reduce electricity prices without leading to higher gas consumption. The cost differential between cap and market prices will be borne by the electricity system in the Member States," explains the document, which does not expressly mention the Spanish-Portuguese model.

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