EU ministers fail to find agreement on energy price crisis as Germany and Austria make gas solidarity-pact

The 27 EU energy ministers have failed to agree on joint measures to combat the current energy price crisis during their meeting in Brussels on Thursday 2 December, Energate Messenger reports. In a joint position paper, countries including France, Spain and Italy demanded to abandon the ‘merit order’ principle of wholesale electricity trading, according to which the last kilowatt-hour needed in the electricity market determines the electricity price. Another, bigger group, which included Germany, Austria and Denmark, opposes such intervention in the electricity market. "Free price formation and competitive markets have proven their worth," said Thomas Bareiß (CDU), outgoing state secretary at the German economy ministry.

Germany and Austria signed an agreement on solidarity-based gas supplies, assuring one another of strategic support in event of a gas supply crisis. "In the extremely unlikely event of an extreme gas shortage, we have defined in the agreement the procedure for how Austria and Germany can help each other quickly," Bareiß explained.

The Federation of German Industries (BDI) has called on the EU energy ministers to rapidly work to make large amounts of renewable electricity and alternative fuels available at competitive prices. Without this, “the climate-neutral industrial continent of Europe remains a pipe dream,” BDI deputy managing director Holger Lösch said. The BDI called for the creation of incentives for alternative energies and fuels while ensuring competitive neutrality and carbon leakage prevention, and for more speed in the development of a European hydrogen economy. Earlier this year, German chemical industry association VCI and energy association BDEW also criticised the EU's toolbox for fighting the energy crisis.