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France and Spain call for pan-European response to soaring energy prices – NEWSWARDEN

October 4, 2021

by Jan Srupczewski

LUXEMBOURG (Reuters) – France and Spain on Monday called for a coordinated European response to soaring global energy prices to protect poorer citizens and business competitiveness, and to safeguard Europe’s ambitious plan to stop carbon emissions. CO2 by 2050.

Gas prices in the European Union rose to record highs on Friday as the bloc’s main gas supplier Russia kept deliveries under tight control, signaling further price pressures on European consumers heading into the heating season. winter.

“What we are seeing is an unprecedented spike in energy prices,” Spanish finance minister Nadia Calvino told reporters as she entered the talks with euro zone finance ministers in Luxembourg.

“This is not a problem that we can address at the national level, we need a coordinated European response,” he said, adding that his country has prepared a paper on possible options.

Calvino said one of these is the creation of a strategic European gas reserve, which would help the 27-nation bloc of 450 million consumers negotiate lower prices than if the same purchases were made individually.

“We have learned through vaccine supply negotiation that we are stronger when we speak with one voice,” he said.

Spain also wanted to see action to stop speculation in the CO2 emission permit market, which pushed prices up, he added.

HIGHER ENERGY PRICES A PROBLEM FOR YEARS, NOT MONTHS

French finance minister Bruno le Maire made a similar note, saying he would propose better regulation of European gas stocks and decouple the price of electricity from gas prices to tie it to the average cost of production in each EU country. .

“The European energy market has a key advantage: it guarantees the supply of energy everywhere in Europe. But it also has a major drawback: the alignment of electricity prices with gas prices, “Le Maire said entering the talks.

He stressed that this link is inefficient and has created a “dead end” for Europe’s transition to renewable energy sources. He also said politicians should explain to voters that fighting climate change will lead to a long-term increase in energy costs.

“For years, not months, we will have to face an increase in the price level, because there is a need for more electricity and there is a link between electricity and gas,” said Le Maire.

“There is also a need to invest more in renewable sources and perhaps in nuclear plants. This means a lot of money that could be required. “

Addressing a sustained rise in energy prices “will be a major political issue for the coming years,” he said.

(Reporting by Jan Strupczewski; Additional reporting by Marine Strauss; Editing by Jan Harvey)

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