The EU accepts that Portugal and Spain take measures to curb the price of electricity

After nine hours of negotiation, the European Council gives the green light to the request of both countries as it is a market with peculiarities

After nine and a half hours of negotiation, the European leaders gave in to pressure from Spain and Portugal. The European Council included in its conclusions the "special treatment" of these two countries in the adoption of measures to curb the price of energy. "It is a very beneficial agreement," proclaimed Spanish President Pedro Sánchez, who celebrated that this decision will allow Spain to have more temporary mechanisms to regulate the price of electricity.

This was confirmed in her appearance before the press by the President of the European Commission, Ursula von der Leyen: "The Iberian Peninsula has a special situation and that is why we have agreed on a possible special treatment so that it can deal with the situation in which they are", he pointed. In this sense, Portugal and Spain will be able to “manage electricity prices”.

Sánchez and the Portuguese president, Antonio Costa, confirmed their intention to use this mechanism to lower the price of the gas that the combined cycle power plants use to generate electricity, which will make it possible to lower the energy bill. The measures proposed by the two countries – all of them of a temporary and exceptional nature – must first receive the approval of the European Commission, which will have the last word.

The two leaders assured that they will present their proposals next week and that they hope that the Community Executive will respond quickly "given the urgency of the situation." In this way, the measures could enter into force in a matter of days.

The European decision on the special character of the Iberian Peninsula was motivated by several factors: the low interconnection with the rest of the continent –it is still far from 3%– and the large production of renewable energy. “The solutions that we are going to propose will not entail a gas subsidy, they will not distort the market or slow down the momentum of renewables,” Sánchez advanced.

This Friday's agreement marks the culmination of the continental tour of the Spanish president, who in recent weeks has met with six European leaders. Spain has not achieved the support of enough countries to address the decoupling of the price of gas from that of energy, which was the great bet of the Sánchez Executive.

The president added that the rapprochement of positions with several European countries is also a first approximation for contacts with a view to a reform of the European energy market. “We have a 1990s market that doesn't make any sense now,” he stressed.

Joint purchases

The document, however, shows a political agreement on other issues that Spain also defended. The joint purchase of gas in Europe is one of them. The idea is that the Twenty-seven use their power in the energy market – the EU imports 40% of the gas it consumes – to achieve lower prices that lower the cost of electricity. It also opens the door to the creation of a platform to carry out these purchases.

The EU invites Member States to use the mechanisms at their disposal, "including the temporary crisis framework, which allows relaxation of energy taxes and the use of 'profits from heaven', to finance state aid." The European Commission will also speed up its procedures to reduce the price of energy for companies and consumers.

The council's conclusions are in line with those approved at Versailles and underline the importance of increasing Europe's strategic reserves and improving the continent's connectivity. All the leaders shared the need to "take urgent measures" to deal with the rise in electricity, but the positions on how to do it were very different, which made it impossible to achieve a common European solution.

On the table were the proposals of the European Commission, which included temporary measures such as limiting the price of energy. Spain, Portugal, France, Belgium, Greece and Italy led the block in favor of this measure, but found the total rejection of Germany and the Netherlands, considering that an intervention in this sense would distort the energy market.

found postures

The debate was intense as the stakes were high. Spain came to the negotiation pressured by the carriers' strike, the protests of the fishing, livestock and agricultural sectors. There is also the presentation of the national war response plan, which will be presented next week.

France attended the meeting with the presidential elections just around the corner – they will be held on April 10th. Macron, who already announced measures to lower fuel prices in April, celebrated the decision to jointly purchase gas, assuring that "it is the best tool" to lower the cost of electricity "in the long term."

German Prime Minister Olaf Scholz assured that his country will achieve energy independence from Russia "earlier than many foresee" and that it will be "a non-reversible process". Berlin has been one of the European capitals most reluctant to intervene in the energy market, due to its great dependence on gas from Moscow.

Italy, another of the countries, more dependent on Russia, defended the idea of creating an energy fund, an idea that was already circulated at the Versailles summit. However, he rejected the idea of establishing a maximum price for energy due to the negative impact that this measure could have on electricity companies.

The Netherlands also rejected this idea, due to the possible problems it could cause to security of supply. They argued that, if there were a European cap, energy companies would choose to export their supply to other continents where they could make a greater profit.

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