At their summit, European Union leaders gave the green light to the obligation to store gas and to voluntary purchases of gas, LNG and hydrogen.
The meeting of EU heads of state took longer than usual because the energy debate on Friday became really detailed and technical.
“Until the end, we honed the wording of the conclusion. Next, we expect more detailed proposals from the Commission on the basis of which action could be taken, ”said the Prime Minister, who represented Finland at the meeting. Sanna Marin (sd) stated the evening after the meeting.
The European Commission proposed earlier this week that Member States should ensure that their underground gas reserves are 80% full by next winter.
This applies to the 18 Member States with underground gas storage facilities. The obligation will rise to 90% in the coming years.
Finland has no storage facilities. Countries like Finland would be obliged to buy an earmarked share of a country’s stock, which corresponds to 15 percent of the country’s annual gas consumption. Finland would probably buy this share in the Baltics.
According to Eurostat, Finland used 2.6 billion cubic meters of gas in 2020. The EU used a total of about 400 billion cubic meters of gas.
The summit resolution states that the filling of gas stocks must begin as soon as possible, taking into account the differences in the level of preparedness of the member states.
“I think the conclusions were balanced. Of course, there is still a lot to do and find out, ”Marin described.
Changes in the price of electricity
For the meeting, the European Commission had assessed ways to address the rising price of electricity and gas.
“National actions we can take in the future include direct subsidies to consumers, tax breaks, state aid, price restrictions and regulation,” Marin said.
The President of the Commission Ursula von der Leyen stated at a post – summit press conference that the Iberian Peninsula, Spain and Portugal, would be temporarily free to set a price cap on their electricity markets.
This is not directly stated in the resolution of the meeting. Prime Minister Marin stated that he did not know the exact technical details of the matter.
Finland has traditionally had reservations about any measures that would disrupt the operation of the electricity market mechanism. Now the tone was softer.
“We need to be open-minded about all the ways we can get the price of energy down in this acute situation. That’s why I don’t knock out the idea of a short-term price cap for energy, but the effects need to be carefully assessed, ”Marin said.
The market price of electricity is determined by the marginal cost of the most expensive required backup power plant at any given time. The markets for natural gas and electricity are thus interconnected, and the rise in the price of gas is also reflected in the price of electricity.
Additional sanctions in place, but no ban on energy imports
According to Marin, EU leaders are ready to move forward with additional sanctions. The leaders expect the Commission to make proposals on how to close the loopholes in the sanctions in the short term.
“The Commission is likely to work on proposals over the weekend and we are ready to move forward with these additional sanctions.”
However, no agreement was reached at the meeting on a ban on imports of Russian energy.
Danske Bankin analysts have estimated that a European Union ban on imports of Russian natural gas and oil would be a “death blow” to the Russian economy and could end Ukraine’s war.
The main opponent of the import ban has been Germany, which is highly dependent on Russian gas.
Was there any frustration in the hall when there was no consensus on an import ban?
“I wouldn’t describe it that way. We had a very unified view that we wanted to break away from imported energy from Russia. Additional sanctions on energy were also on display, and as I have said, Finland can also support additional sanctions in the energy sector, ”said Marin.
Is gas paid in rubles?
President of Russia Vladimir Putin announced on Wednesday that the countries defined by Russia as hostile, namely the EU countries, the United States and Britain, will have to pay their gas bills in rubles in the future.
If EU countries agree to the demand, the ruble is likely to strengthen. That would be a setback, as the current sanctions have caused the value of the ruble to plummet.
According to Marin, Putin’s demand was discussed among the heads of state, but the matter did not reach a final conclusion.
“Of course, Finland starts from the fact that the agreements are complied with, ie payments are made in another currency [kuin ruplissa]. But this is definitely something we will return to later. ”