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Commission President Ursula von der Leyen (during a speech in the EU Parliament, 2020)
Photo: Kenzo Tribouillard/ AFP
EU Commission President Ursula von der Leyen has announced a reform of the electricity market in the EU in view of the high energy prices.
"The skyrocketing electricity prices are showing the limits of our current electricity market design for various reasons," said von der Leyen at an international conference in Slovenia.
The system was developed for different circumstances and is no longer appropriate.
"That's why we are now working on an emergency measure and on a structural reform of the electricity market," said von der Leyen.
On the European electricity market, prices are currently set primarily by gas-fired power plants.
Since the price of gas has increased sharply against the background of the war in Ukraine, electricity has also become more expensive.
A reform of the European electricity market could revise this mechanism so that consumers pay less for cheap electricity from the sun and wind, for example.
Decouple the end customer price for electricity from the gas price
Federal Minister of Economics Robert Habeck (Greens) recently announced a fundamental reform to decouple the development of end customer prices for electricity from rising gas prices.
The issue is also to be discussed at a special meeting of EU energy ministers on 9 September.
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The so-called merit order system in the EU determines the price development based on the order in which the power plants are deployed.
Power plants that can produce electricity cheaply are used first to meet demand.
These are wind turbines, for example.
In the end, however, the price depends on the power plant that was switched on last and is therefore the most expensive, in order to cover the demand - these are currently the gas-fired power plants.
Since the prices are particularly high, providers of renewable energies achieve very high profits as a result.
The system was originally intended to create an incentive for investing in renewable energy.
In view of the exploding energy prices, the energy industry in Germany is currently demanding a reduction in VAT on gas and electricity.
According to a paper by the Federal Association of Energy and Water Industries (BDEW), the levy on the gas and electricity price should be reduced from 19 percent to the reduced rate of 7 percent from January 1, 2023.
According to the paper, the reduced rate should initially apply for at least two years.
mamk/dpa
