The energy thread

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Danish EB writes

Electricity prices send families into poverty:
EU promises urgent action
EU Commission President now promises urgent action on rising energy prices in Europe

Since Russia's invasion of Ukraine, the term 'energy poverty' has sadly become a reality for many.

But now EU commission president Ursula von der Leyen is joining the fight for lower prices in earnest, calling for 'urgent action' at a speech in Slovenia.

Changing the pricing model
By all appearances, the EU commission's call for urgent action looks like a change to the existing electricity pricing model across Europe.

As the model stands, it is the rising price of natural gas that is driving the sky-high price of electricity. In concrete terms, this means that the crisis in one part of the energy market today is having a direct impact on another.

In addition to prices in one part of the market reflecting the other, it is also currently the most expensive price that sets the price framework.

Wind and solar electricity generators get the same price as natural gas-fired power plants, even though the latter have significantly higher costs these days.

Von der Leyen's pledge in Slovenia, however, does not reveal details of what the EU Commission envisages a crackdown might look like

Fear of closure
On Friday, electricity prices in France and Germany rose by 25%. This meant, among other things, that Germany's electricity prices hit a record high of €700 per megawatt hour.

The rising prices are due to Russia's state-controlled export monopoly Gazprom announcing it would halt the flow of natural gas through the Nord Stream pipeline for three days.

Officials say it is as part of necessary maintenance, but European energy market fears Russia will not open up the natural gas again.

Germany said no in the spring, but now the federal government in Berlin is refusing to change the pricing model for electricity in Europe.

Translated with www.DeepL.com/Translator (free version)

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