"We know that the EU pays very high prices for gas" and although prices have dropped "we remain exposed to speculative dynamics" on energy costs.
"Ours is not a regulatory intervention to fix the price of gas but a mechanism of last resort that is triggered" under certain conditions and in any case "when the predefined gas price exceeds 275 euros per megawatt hour for two weeks".
This was stated by the EU Commissioner for Energy Kadri Simson announcing the new legislative proposal on the price cap.
The ceiling set in the proposal is therefore 275 euros per megawatt hour according to the TTF index.
The gas price cap proposed by the European Commission will be activated "when the spread between the price on the TTF and the global price of LNG is equal to or greater than 58 euros for ten days of transactions".
"This is the crucial condition to ensure that the" corrective intervention on the market "takes place only when TTF gas prices no longer reflect market fundamentals" and it is "also crucial to ensure that we will be able to continue to attract LNG at this difficult time for the EU," Simson said.