Russia’s invasion of Ukraine has seen a united front from around the globe to isolate Russia for its illegal invasion
The Third Vice-President of the Government of Spain and Minister for Ecological Transition and Demographic Challenge, Teresa Ribera, took part in the extraordinary Energy Council of the European Union, which was held today in Brussels.
“We support the French Presidency of the EU in the need to diversify and accelerate a solvent dialogue with gas and oil suppliers that guarantees a stable and affordable supply”, stressed Ribera, who insisted that the best recipe for reducing Europe’s energy fragility “is to accelerate investment in energy transition, in renewables, in energy savings and efficiency, and in storage technologies”. She also emphasized the need to increase the interconnection between the Iberian Peninsula and the rest of the EU.
With an international scenario marked by a worsening of high energy prices resulting from the situation in Ukraine, Spain has reiterated the need to adopt exceptional and extraordinary measures to deal with an exceptional situation, within the European framework, while at the same time making coordinated progress in the evolution and updating of the design of the energy markets: “We are seeing an immense fragility in Europe in terms of energy as a result of a very high dependence on a single gas supplier – Ribera pointed out on her arrival at the Council – and the solution lies in accelerating the energy transition to reduce dependence, diversifying suppliers, boosting savings and efficiency, accelerating renewables, facilitating a fluid dialogue with other gas suppliers, seeking maximum cooperation at a European level and applying measures with immediate effect”.
“That is why we welcome the Commission’s announcement to present a new Toolbox Communication, with extraordinary measures that should be applied quickly, as soon as possible”, added the vice-president, in relation to the EU executive’s announcement to make more progress in relation to the measures proposed in October in the first Toolbox Communication, which Spain considers insufficient.
Transfer income from generators to consumers
During the Council, Spain has argued that these measures should include limiting the spill-over effect of gas on electricity: “Electricity price formation should be decoupled from the volatility of natural gas prices in emergency situations, e.g. through a price cap on the price of electricity produced with natural gas and a mechanism to ensure the subsequent recovery of the costs of gas-fired combined cycle power plants.
Ribera also called for rapid mechanisms to recover the windfall profits from sub-marginal power plants for consumers: “The debate on the recovery of windfall profits from high gas prices in the current market design is welcome. To be effective, measures on infra-marginal incomes must allow for a rapid response, operational as soon as possible.
The Vice-President also called for the establishment of incentives for the conclusion of long-term fixed-price contracts (PPAs) for industry, where the EIB could play an important role by providing guarantees. “The EIB could also provide financing to commercial banks to promote self-consumption, energy efficiency and other small actions that encourage social participation, such as energy communities.
Finally, the vice-president pointed out the need to increase interconnections between the peninsula and the rest of Europe, which are far below the established levels, and highlighted the strength of joint European action: “Despite the harshness of the moment we are living through, it is gratifying to see the capacity to articulate such an immediate, unanimous and consensual response. I think that the general thrust of the European response is extremely positive and shows that the only way forward is to build Europe together,” she concluded.