Tag: European Commission

The press release issued by the European Commission on 26 October 2022.

Today the Commission is proposing stronger rules on ambient air, surface and groundwater pollutants, and treatment of urban wastewater. Clean air and water are essential for the health of people and ecosystems. Air pollution alone means nearly 300,000 Europeans die prematurely each year, and the proposed new rules will reduce deaths resulting from levels of the main pollutant PM_2.5 above World Health Organization guidelines by more than 75% in ten years. Across air and water, all of the new rules provide clear return on investment thanks to benefits in health, energy savings, food production, industry, and biodiversity. Learning the lessons from current laws, the Commission proposes to both tighten allowed levels of pollutants and to improve implementation to ensure pollution reduction goals are more often reached in practice. Today’s proposals are a key advance for the European Green Deal‘s zero pollution ambition of having an environment free of harmful pollution by 2050. They also respond to specific demands of the Conference on the Future of Europe.

Executive Vice-President for the European Green Deal, Frans Timmermans, said: “Our health depends on our environment. An unhealthy environment has direct and costly consequences for our health. Each year, hundreds of thousands Europeans die prematurely and many more suffer from heart- and lung diseases or pollution-induced cancers. The longer we wait to reduce this pollution, the higher the costs to society. By 2050, we want our environment to be free of harmful pollutants. That means we need to step up action today. Our proposals to further reduce water and air pollution are a crucial piece of that puzzle.”

Commissioner for the Environment, Oceans and Fisheries, Virginijus Sinkevičius, said: “The quality of the air we breathe and the water we use is fundamental for our lives and the future of our societies. Polluted air and water harm our health and our economy and the environment, affecting the vulnerable most of all. It is therefore our duty to clean up air and water for our own and future generations. The cost of inaction is far greater than the cost of prevention. That is why the Commission is acting now to ensure coordinated action across the Union to better tackle pollution at source – locally and cross-border.”

Cleaner ambient air by 2030, zero pollution aim by 2050

The proposed revision of the Ambient Air Quality Directives will set interim 2030 EU air quality standards, aligned more closely with World Health Organization guidelines, while putting the EU on a trajectory to achieve zero pollution for air at the latest by 2050, in synergy with climate-neutrality efforts. To this end, we propose a regular review of the air quality standards to reassess them in line with latest scientific evidence as well as societal and technological developments. The annual limit value for the main pollutant – fine particulate matter (PM_2.5) – is proposed to be cut by more than half.

The revision will ensure that people suffering health damages from air pollution have the right to be compensated in the case of a violation of EU air quality rules. They will also have the right to be represented by non-governmental organisation through collective actions for damage compensation. The proposal will also bring more clarity on access to justice, effective penalties, and better public information on air quality. New legislation will support local authorities by strengthening the provisions on air quality monitoring, modelling, and improved air quality plans.

Today’s proposals leave it to national and local authorities to determine the specific measures they would take to meet the standards. At the same time, existing and new EU policies in environment, energy, transport, agriculture, R&I and other fields will make a significant contribution, as detailed in the factsheet.

Today’s proposal will help achieve dramatic improvement in air quality around Europe by 2030, leading to gross annual benefits estimated at €42 billion up to €121 billion in 2030, for less than a €6 billion costs annually.

(WHO guidelines: <5 µg/m³, annual; 2030 proposal: <10 µg/m³; current directive: <25 µg/m³)[i]

Air pollution is the greatest environmental threat to health and a leading cause of chronic diseases, including stroke, cancer and diabetes. It is unavoidable for all Europeans and disproportionately affects sensitive and vulnerable social groups. Polluted air also harms the environment causing acidification, eutrophication and damage to forests, ecosystems and crops.

Better and more cost-effective treatment of urban wastewater

The revised Urban Wastewater Treatment Directive will help Europeans benefit from cleaner rivers, lakes, groundwaters and seas, while making wastewater treatment more cost-effective. To make the best possible use of wastewater as a resource, it is proposed to aim for energy-neutrality of the sector by 2040, and improve the quality of sludge to allow for more reuse contributing thus to a more circular economy.

Several improvements will support health and environmental protection. These include obligations to recover nutrients from wastewater, new standards for micropollutants and new monitoring requirements for microplastics. Obligations to treat water will be extended to smaller municipalities with 1,000 inhabitants (from 2,000 inhabitants currently). To help manage heavy rains, made more frequent by climate change, there is a requirement to establish integrated water management plans in larger cities. Finally, building upon the Covid-19 experience, the Commission proposes to systematically monitor wastewater for several viruses, amongst which CoV-SARS-19, and anti-microbial resistance.

EU countries will be required to ensure access to sanitation for all, in particular vulnerable and marginalised groups.

As 92% toxic micro-pollutants found in EU wastewaters come from pharmaceuticals and cosmetics, a new Extended Producer Responsibility scheme will require producers to pay for the cost of removing them. This is in line with the ‘polluter pays’ principle and it will also incentivise research and innovation into toxic-free products, as well as making financing of wastewater treatment fairer.

The wastewater sector has significant untapped renewable energy production potential, for example from biogas.  EU countries will be required to track industrial pollution at source to increase the possibilities of re-using sludge and treated wastewater, avoiding the loss of resources. Rules on recovering phosphorus from sludge will support their use to make fertiliser, benefiting food production.

The changes are estimated to increase costs by 3.8% (to €3.8 billion a year in 2040) for a benefit of over €6.6 billion a year, with a positive cost-benefit ratio in each Member State.

Protection of surface and groundwater against new pollutants

Based on up-to-date scientific evidence, the Commission is proposing to update lists of water pollutants to be more strictly controlled in surface waters and groundwater.

25 substances with well-documented problematic effects on nature and human health will be added to the lists. These include:

• PFAS, a large group of “forever chemicals” used among others in cookware, clothing and furniture, fire-fighting foam and personal care products;
• a range of pesticides and pesticide degradation products, such as glyphosate;
• Bisphenol A, a plasticiser and a component of plastic packaging;
• some pharmaceuticals used as painkillers and anti-inflammatory drugs, as well as antibiotics.

The substances and their standards have been selected in a transparent and science-driven process.

In addition, learning the lessons from incidents such as the mass death of fish in the Oder river, the Commission proposes mandatory downstream river basin warnings after incidents. There are also improvements to monitoring, reporting, and easier future updates of the list to keep up with science.

The new rules recognise the cumulative or combined effects of mixtures, broadening the current focus which is on individual substances solely.

In addition, standards for 16 pollutants already covered by the rules, including heavy metals and industrial chemicals, will be updated (mostly tightened) and four pollutants that are no longer an EU-wide threat will be removed.

Next steps

The proposals will now be considered by the European Parliament and the Council in the ordinary legislative procedure. Once adopted, they will take effect progressively, with different targets for 2030, 2040, and 2050 – giving industry and authorities time to adapt and invest where necessary. 

The press release issued by the European Commission on 25 October 2022.

Thank you, Jozef, and good afternoon, everyone.

Exactly a week ago, the Commission presented the most recent package of proposals to tackle the energy crisis, dedicated to gas prices in particular. Following the endorsement and guidance of the European Council last week, we now had a more detailed discussion with the ministers on how to move forward.

The package has a number of important elements that we will jointly work on, to be ready for adoption at the next Extraordinary Council.

First, making joint purchasing of gas a reality. There was strong support for this idea among the ministers and a keen interest in the details of the set-up. It is clear that combining our strength on the global market is to our advantage. If the proposed two-step model will be agreed at the November Council, we will be ready to jointly buy gas to refill the storage after this heating season.

This process will cover at least 13.5 billion cubic meters of gas, enough to be attractive to the suppliers and meaningful for the market. In parallel, we will continue negotiations with our partners to secure necessary supplies for this winter and beyond. I will be in Norway after tomorrow for a High-Level Energy Dialogue.

Second, addressing the high gas prices. With our proposal, we ask ACER to develop by 31 March a new complementary EU gas benchmark that adequately reflects the current market situation. There is a broad consensus that this is a useful step to take to increase transparency and predictability of prices.

While the new benchmark will be ready by the next filling season, we have also proposed to establish a dynamic cap on TTF that can be used immediately to address excessively high gas prices. Based on the constructive discussion today, the Commission will swiftly work on the details of the proposal. As we develop this short-term tool, we must ensure security of supply and avoid increasing gas consumption.

In addition to these two measures, the Commission has tasked ESMA with developing circuit breakers for intra-day derivatives trading.

The third pillar of the package is strengthening solidarity between Member States in case of severe supply disruption in the coming winter. Our proposal includes default rules that will apply in case there is no bilateral solidarity agreement in place. We will also propose a mechanism for the allocation of gas between Member States for which an emergency has been declared.

Following the European Council conclusions, we will further examine the cap on gas used for electricity production, including a cost-benefit analysis. The Member States have received a Commission analysis of the measure as input for today’s discussions.

The European Council conclusions also invite a fast-track simplification of permitting procedures for renewables and grids, including through emergency measures.  As you know, the Commission already proposed in May measures to streamline and speed up the permitting process. I am calling on both the Council and the European Parliament to have their position ready by early November.

As we are tackling the current energy crisis, we cannot forget about our longer-term plans. I therefore very much welcome today’s discussion on the hydrogen and gas markets decarbonisation package. Scaling up green hydrogen and biomethane will help us to phase out Russian fossil gas fully and for good. Today’s discussion makes me confident that the Council can agree on its position by December.

We took one step closer to a more energy-efficient future with the Council reaching a political agreement on the Energy Performance of Buildings Directive. Buildings consume 53% of gas in the EU, making it a key sector for decarbonisation and energy security, as well as reducing energy bills. Today’s agreement is less ambitious than the original Commission proposal. But it is a step forward and a basis for engaging in the negotiations with the Parliament as soon as possible – to give the necessary certainty to people and businesses involved.

Finally, today’s Council gave me the opportunity to inform Ministers about the critical energy situation of two countries in our European family.

In Ukraine, Russia’s recent shelling has targeted energy infrastructure and caused severe damage. 30% of Ukrainian equipment, such as transformers, circuit breakers and power lines have been destroyed, causing mass outages.

It is urgent that the EU steps up its support to quickly replace the damaged infrastructure. What is at stake, is the protection and well-being of tens of thousands of households, vulnerable people, children and elderly this coming winter. I have written to all the ministers and called for their urgent support in this.

As you remember, we have set up months ago a fund at the Energy Community Secretariat, dedicated to repairing specific energy infrastructure in Ukraine. We have now collected 20.5 million euros in donations, but we clearly need more. I recalled that Member States have another option available to help Ukraine’s energy repair and reconstruction. This is to donate energy equipment through Commission’s Emergency Response Coordination Centre. This mechanism has already facilitated more than 60 energy-related donations.

Private companies have also been generous and delivered supplies worth over 10 million euros. We are encouraging them to do even more and can help with transporting the donated equipment to Ukraine. Besides energy equipment, we need to continue supplies of gasoline and diesel.

In Moldova, the situation is also increasingly challenging. Moldova relied on Ukraine for 30% of its electricity imports. The forced suspension of electricity exports from Ukraine poses a major problem for Moldova

Last week, Moldova was also informed that gas flows from Gazprom will be further reduced and so will the electricity supplies from Transnistria. This is another clear example that Russia is weaponising energy supplies. Moldova has secured some alternative supplies from Romania for a limited period, but this is not enough.

We are working with the Energy Community to ensure Moldova can import gas and electricity from alternative sources other than Transnistria. But the challenge is not only the access to supply, but the financing as well.

We are looking into ways of stepping up the EU support.

This Council was in the end about solidarity and a united response to the crisis. I am glad that today’s discussions, and the decisions taken on the EPBD, show that we remain united both in driving forward our Green Deal agenda and in shaping effective solutions to the energy crisis, both for the EU Member States  and our neighbours.

The press release issued by the European Commission on 25 October 2022.

The Commission adopted a recommendation to the Council to authorise the opening of negotiations of upgraded European Border and Coast Guard Agency’s (Frontex) status agreements between the EU and Albania, Serbia, Montenegro, as well as with Bosnia and Herzegovina. The Commission is also adopting today a new assistance package worth €39.2 million under the Instrument for Pre-Accession Assistance (IPA III) to strengthen border management in the Western Balkans.

Commissioner for Home Affairs, Ylva Johansson, said: “We are committed to supporting our partners in the Western Balkans and strengthening our cooperation on migration management on the ground. Therefore, we propose to negotiate status agreements under the new legal framework that would allow for the deployment of Frontex to all four partner countries with the full power of its mandate, to ensure that their borders continue to be respected and protected in line with European best practices.”

Commissioner for Neighbourhood and Enlargement, Olivér Várhelyi, said: “This package is timely, as migration remains an area where we need to work even more closely with our Western Balkan partners. Given the increased migratory pressure in the region, we are focusing on strengthening border protection, fighting the smuggling networks and stepping up returns from region. To this end, we will provide increased political and financial help. Between 2021 and 2024, we intend to increase our funding by 60% in total, to at least €350 million for our Western Balkan partners. This will support the Western Balkans in all areas of developing effective migration management systems, including asylum and reception, border security and returns. We count on the commitment our Western Balkan partners to make these actions a success.”

With today’s proposal, the Commission with the support of Frontex will strengthen the capacity of the Western Balkans’ partners in their migration management, fight against smuggling and ensuring security. Under the currently existing status agreements between Frontex and Albania, Serbia and Montenegro, deployment of the standing corps may only take place at the countries’ borders with the EU and without exercising executive powers. Under the new legal framework, the status agreement will allow Frontex standing corps to be deployed in the third country both at the EU border and at the borders with the third countries and exercise the executive powers. Therefore, new status agreements will better support and strengthen cooperation on border management in the Western Balkans.

The assistance package adopted today follows a detailed assessment of needs established with the Western Balkan authorities. The support targets the region’s border management capacities mainly through the provision of specialised equipment. It includes mobile surveillance systems, unmanned aerial vehicles, biometric devices, training and support to establish and operationalise National Coordination Centres. The support also covers the operationalisation of migration facilities, including reception and detention facilities. This package brings the total bilateral and regional support adopted in this area under IPA III to €171.7 million.

The press release issued by the European Commission on 25 October 2022.

Today, the European Commission has published the 2022 Eurobarometer surveys dedicated to EU competition policy. The surveys show strong support among citizens and Small and Medium Enterprises (‘SMEs’) for both competition policy and its enforcement.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “The results from the survey are clear: competition improves the daily life of citizens and SMEs, bringing better prices, more choice and increased innovation. This support is consistent across the EU, and it is a reminder that fair competition is as important as ever.”

Main findings 

The Eurobarometer surveys published today show that Europeans support the main goals of competition policy, recognising its important contribution to the European economy. In particular, respondents confirmed that in their view competition policy:

• encourages innovation (82% of citizens and 89% of SMEs);
• allows for better prices (74% of citizens and 81% of SMEs) and more choice (83% of citizens and 84% of SMEs);
• helps EU companies become more competitive on global markets (72% of citizens and 73% of SMEs).

The vast majority of citizens and SMEs participating to the survey strongly support different measures to improve competition even further. They believe that competition has a key role to prevent players across market sectors from abusing their market power (87% of citizens and SMEs) and to fight cartels (84% of citizens and SMEs). 76% of citizen’s and 73% of SMEs believe it is important to prevent mergers and acquisitions that reduce competition. Finally, Europeans think it is important to take advantages away from competitors subsidised by non-EU governments (70% of citizens and 74% of SMEs) and by EU governments (69% of citizens and 73% of SMEs).

A majority of respondents recognise competition policy and its enforcement as a key tool in facing the challenges ahead. As an example, 66 per cent of SMEs agree that regulation, such as the Digital Markets Act, can be an effective solution in markets with systemic issues. For what concerns the achievement of the Commission’s policy priorities, a majority of citizens believe that competition encourages the digital transformation of the economy and society (73%), as well as the offer of more environmentally friendly goods and services in the EU Single Market (54%).

For what concerns citizens, more than 50 per cent (54%) have experienced issues caused by a lack of competition, such as higher prices, less choice or lower quality. When asked about the areas in which they believe competition enforcement should play an even stronger role, citizens expressed their concerns for the lack of competition in the energy sector (27%), followed by food retailing (20%). In the last Eurobarometer survey, published in 2019, telecommunications and Internet access were at the top of citizens’ concerns (26%), while today only 18% of respondents have identified this as an area in which competition should be improved.

When asked about the competition-related difficulties experienced, SMEs mentioned high prices (57%), as well as powerful suppliers and buyers being able to impose unfair conditions (experienced by respectively 57% and 42% of respondents). For what concerns specific sectors, SMEs expressed their view that stronger competition in the provision of raw materials (12%) would be of the essence, as well as in the provision of energy (8%) and in the use of digital platforms to reach customers (8%).

European citizens and SMEs stay on top of the news concerning competition enforcement mostly through newspapers (including online) (52% of citizens and 51% of SMEs) and TV (48% of citizens and 41% of SMEs). However, social media has proven to be an increasingly relevant source of information for citizens on competition (rising from 24% in 2019 to 39% in 2022), as well as for SMEs (37% in 2022).

The press release issued by the European Commission on 24 October 2022.

Today, the Council has adopted the final building blocks of the European Health Union: the Regulation on Serious cross-border health threats, the Regulation on the extended mandate of the European Centre for Disease Prevention and Control (ECDC) and the Emergency Framework Regulation to provide extra powers to the European Health Emergency Preparedness and Response Authority (HERA). These new rules complete the European Health Union, building a powerful legal framework to improve the EU’s capacity in the vital areas of prevention, preparedness, surveillance, risk assessment, early warning, and response.

Welcoming the adoption, Vice-President for Promoting our European Way of Life, Margaritis Schinas, said: “Today’s adoption by the Council of the three Regulations is a major achievement, and strengthens the EU Health Security Framework. With these new regulations, we have shown that we can move forward together, decisively, and fast. This legislation will work hand in hand with the financial support provided through the EU4Health Programme and the Recovery and Resilience Facility to ensure more resilient health systems across the EU. Collaboration and solidarity are key for the challenges ahead of us.”

Commissioner for Health and Food Safety, Stella Kyriakides, said: “The central pillars of our European Health Union are now in place. The pandemic has shown the need for more Europe in public health, and a stronger capacity to protect citizens from health threats. With a stronger ECDC, an empowered HERA and a reinforced role for the EU in preventing, preparing for, and managing cross-border health threats, we now have additional tools to quickly react and respond to emerging health crises, decisively and with unity”.

With the adoption of the Serious cross-border threats to health Regulation, the EU will have:

• a robust preparedness planning and a more integrated surveillance system;
• a better capacity for accurate risk assessment and targeted response;
• solid mechanisms for joint procurement of medical countermeasures;
• the possibility to adopt common measures at EU level to address future cross-border health threats.

A stronger ECDC will not only issue recommendations to Member States regarding health threats preparedness, but also host a new excellence network of EU reference laboratories and establish an EU Health Task Force for rapid health interventions in the event of a major outbreak.

To be effective and operational in times of public health emergencies, the Emergency Framework Regulation will allow the establishment within HERA of a Health Crisis Board. This Board will rapidly coordinate at EU level the supply of and access to medical countermeasures. The Regulation also enables the activation of the EU fab facilities, emergency research and innovation plans and access to emergency funding.

Next steps

Following today’s adoption of the three Regulations, they will be published in the Official Journal and will enter into force in November 2022.

The press release issued by the European Commission on 24 October 2022.

omorrow, European Commission President Ursula von der Leyen and Chancellor Olaf Scholz, in his given capacity as German Presidency of the G7, will co-host the International Expert Conference on the Recovery, Reconstruction and Modernisation of Ukraine in Berlin. This conference is another important step in the series of global events, which demonstrate unwavering support from the Commission and the international community to Ukraine in the face of Russia’s unprovoked and unjustified war of aggression. It also highlights that the Commission and the international community will continue to support Ukraine beyond its immediate needs, and on its path to EU accession.

Given the scale of the challenge at stake, the recovery efforts need to be an inclusive multi-stakeholder process, involving both public and private sectors, as well as international organizations. That is why the conference will bring together world-renowned experts across various disciplines and backgrounds, international organisations, senior government representatives, think tanks and academics, as well as representatives from civil society and the private sector, together with the Ukrainian government. The participants will discuss key matters for the recovery, reconstruction and modernisation of Ukraine. These discussions will contribute to shaping global efforts on the way ahead for Ukraine’s green, resilient, prosperous and democratic future.

President Ursula von der Leyen said: “The courageous Ukrainian men and women of Ukraine are fighting for their independence and the rules-based international order.  We will be at Ukraine´s side as long as it takes. The road to reconstruction is at the same time Ukraine’s path towards its vision to become a more modern, democratic and prosperous country. Every euro, every dollar every pound and every yen spent will be an investment in Ukraine and democratic values around the globe. At the same time the broad support for the brave people of Ukraine is a strong statement that the free and democratic nations of this world stand together.”

Following the opening remarks from President von der Leyen and Chancellor Scholz, President of Ukraine Volodymyr Zelenskyy will deliver a keynote address. During the opening plenary, participants will hear from Ukrainian Prime Minister Denys Shmyhal and other high-level speakers about the international perspectives on Ukraine’s geopolitical and economic outlook and the scale of the recovery and reconstruction needs.

The morning sessions will cover a range of topics beginning with lessons learned from historical reconstruction efforts like the Marshall Plan in Europe and taking stock of the current situation in Ukraine and the sequencing of recovery and reconstruction needs. Discussions will then focus on the financing of recovery and reconstruction, exploring possible frameworks for governance and emphasising strong Ukrainian ownership in the process of mobilising resources and private sector involvement.

The afternoon sessions will be devoted to key priorities for Ukraine’s sustainable growth, development, and stability, including with a view to EU accession. These sessions will focus on institutional transformation and good governance, macroeconomic and financial stability, industrial policy and sustainable development, and inclusiveness.

The event will be live-streamed and will be available here. The press conference will take place at +/- 10:30 CEST and can be followed on EbS.

Next Steps

Targeted expert recommendations will be published on the website of the International Expert Conference as an outcome document. These recommendations will feed into bilateral, European, and multilateral discussions with Ukrainian counterparts, as support shapes up. These fora include the annual Ukraine Recovery/Reform Conference, to be hosted by the UK mid-next year.

The press release issued by the European Commission on 24 October 2022.

Europeans are worried about the effect of air pollution on health and the environment, according to a special Eurobarometer survey published today. Most also think that industry, public authorities and employers need to do more to improve air quality. Respondents clearly favour an international or European approach to improving air quality and a large majority of the respondents who have heard of EU air quality standards say that they should be strengthened.

Commissioner for Environment, Oceans and Fisheries Virginijus Sinkevičius said: “People tell us that they want clean air to breathe. People living in cities, asthma sufferers and those living near industrial plants, they are all worried and they are asking us to act. The Commission will lead the way with an ambitious proposal to strengthen EU air quality standards.”

Key findings of the survey

Concern about health and environmental impact of air pollution

Most Europeans think that health conditions such as respiratory diseases (89%), asthma (88%), and cardiovascular diseases are serious problems in their countries resulting from air pollution. Europeans are also worried about the environmental problems caused in water bodies by air pollution such as acidification and eutrophication (both 83%). Acidification (water becoming more acidic) and eutrophication (excessive amount of nutrients in water leading to overgrowth of algae suffocating other organisms) are among the main consequences of worsening water quality.

Perception that air quality has worsened

Nearly half of the respondents hold the view that that air quality has deteriorated in the last ten years (47%). This percentage is however an 11-point drop since 2019.

Support for strengthening EU air quality standards

The Eurobarometer reveals that citizens lack information about air quality problems in their country. Most of Europeans remain poorly informed about the existing EU air quality standards as only a minority of respondents (27%) have heard of them. Nevertheless, a large majority of the respondents (67%) who are aware of EU air quality standards say that they should be strengthened. This is true in all but five Member States.

Support for more action to promote air quality, especially at international level

A large majority of Europeans think air pollution should be addressed at the international level (65%) followed by the European and the national level (both 42%), and finally the regional or local level (32%). A significant proportion of the respondents also believe that actions should be carried out at all levels simultaneously (19%).

Individual action to reduce harmful emissions

A majority of Europeans think that large industrial installations, fossil-fuel based energy producers, public authorities, and employers are not doing enough to promote good air quality.

A majority also thinks that the household sector is doing enough. Respondents are more likely to have taken some action to reduce emissions themselves this year than in 2019. Using public transport, cycling, or walking is the most frequent method Europeans report they use to reduce harmful emissions into the air.

As announced in the European Green Deal as part of the zero pollution ambition for a toxic-free environment, the Commission is about to propose a revision of the current EU air quality standards. This will align them more closely with the most recent World Health Organization (WHO) recommendations, and will strengthen provisions to help local authorities achieve cleaner air. The revised proposal will also focus on better implementation in order to help reach those standards in practice.

The press release issued by the European Commission on 21 October 2022.

Indeed, we had a very good European Council. We do now have a very good and solid roadmap to keep on working on the topic of energy prices. The Leaders have given the strategic guidance we wanted on the proposal that we have put on the table on Tuesday and that will be discussed by Energy Ministers on Tuesday next week. Let me focus on a few topics that we have discussed intensively.

The first one is the topic of the joint purchasing of gas. Here, Leaders supported very much the idea to allow companies, for the joint purchase, to build consortia and to work together and join forces so to increase our common European Market power for the demand of gas. There is one binding element in it. That is: When, at the beginning, we aggregate the demand, 15% are binding to be aggregated as demand on the market, together as a joint aggregated demand.

The second topic was the focus on how to limit episodes of excessive gas prices. This is the discussion around the benchmark for gas prices, the so-called TTF. We know that the TTF mainly reflects pipeline gas but as we see that the market is shifting and more LNG is coming to the market, the TTF no longer reflects the true market situation. Therefore, we will develop a complementary new index to better reflect the LNG price situation. In the meantime, we are going to establish a market correction mechanism, exactly to limit excessive episodes of gas prices and to make sure that there is a clear order in the build-up of the market. Here, we will work with Energy Ministers to submit a legal proposal to operationalise this market correction mechanism.

Of course, Leaders also discussed a second topic, which is a potential mechanism to limit the influence of high gas prices on the cost of electricity. We had a frank discussion which further clarified, on the one hand, the opportunities and, on the other hand, highlighted the challenges. We will analyse the financial impact on those countries with a lot of gas in their electricity production. What does it mean if we cap the price of gas to reduce the influence of gas on the electricity price? And the other topic which has to be analysed is the flows of subsidised electricity to non-EU neighbours. Here too, we will work together with Member States and with the Council formation to find a well-balanced and common approach on these issues.

The Commission will also come back to the issue of state aid. Next week, the College will adopt a proposal on the prolongation and adaptation of the Temporary Crisis Framework. This will give Member States an improved ability to support their companies in the face of the current crisis, while preserving a level playing field. So common rules for everybody. For example, thanks to the extension of time limits for state support, or new options to support companies reducing their electricity demand. This new revised state aid crisis framework will then be decided on next week in the College.

Moving on to the topic of funding. I just mentioned the state aid opportunities but there is also a strong look at the possibilities to support vulnerable households and vulnerable businesses. We are aiming to make available up to around EUR 40 billion of funds that are still available from the previous MFF. With that, Member States will be able to help those most affected by the energy crisis, be it the vulnerable households or SMEs. But indeed, more is needed to support small and medium companies but also larger industry to deal with the high energy prices.

Here, the topic of investment is very important. The investments can be financed through the European level. That is the REPowerEU vehicle that is right now in the process of being decided on in Parliament. It has already been decided on in Council. So we are moving forward to the trilogue, hoping that this instrument will then be finalised as soon as possible. Here is the possibility for all Member States to have common European funding to invest in their companies, in their SMEs, to help them to make the transition away from fossil fuels to, for example, renewables, cheaper sources of energy and thus prepare for the future.

We had a very good Council on all these topics. I think I will stop here and I will be happy to take questions.

 

The press release issued by the European Commission on 18 October 2022.

Opening remarks by Commissioner Simson and Commissioner McGuinness at the press conference on a new package of measures to fight high energy prices and ensure security of supply.

Thank you President, good afternoon, everyone.

The EU has been fighting the energy crisis for a year. As the crisis has evolved, we have responded together, protecting our people and businesses, directing revenues to support consumers, ensuring sufficient gas storage, reducing demand and negotiating with old and new suppliers.

These steps have helped to bring prices down, compared to the record levels in August. But they are still high and the risk of further price hikes and gas supply disruptions for this winter is real.

President von der Leyen has already laid out very clearly the context of today’s proposals and their main elements. Let me go into some more detail.

First, the joint purchase of gas. This is a topic where the groundwork has already been done. In April, we put in place the Energy Platform and since then, we have created five regional task forces to better understand our gas needs and infrastructure opportunities.

Today, we are proposing the tools to make joint purchasing possible. This is a no-regret option, as buying together gives us more leverage. On the other hand, it is not easy to implement. Gas is in the EU usually bought by companies, not Member States, let alone the Commission. We have worked very closely with EVP Vestager and her team to find a solution that is in line with the EU competition policy.

We propose a two-step approach. First, we will aggregate the demand, pooling the gas needs of the companies willing to participate. The Commission will contract this procedure out to a service provider, who will collect the necessary data via an IT-tool.

Following that, the companies can conclude their contracts with the suppliers. They can also form a gas purchasing consortium and buy gas together, coordinating volumes, prices, delivery points and times.

There is a mandatory element, which is that the aggregation has to cover an amount of gas equivalent to 15% or their storage filling requirement.

This is around 13.5 billion cubic meters of gas – equivalent to the annual gas use of Greece, Bulgaria, Croatia and Slovenia combined. Or the joint consumption of Portugal, Ireland and Finland. So, it is a meaningful amount that would be attractive to sellers and helpful in terms of refilling storage. The participating companies will be free to aggregate and purchase more than 15%, we are only setting the absolute minimum.

But joint purchase alone will not be enough to address the level of prices we are seeing due to Russian manipulation and very tight global markets.

We need a new price benchmark that better reflects today’s market reality, better than TTF. While TTF was a good proxy for the EU gas prices when we received large amounts of Russian pipeline gas, this is no longer the case. Now, TTF prices are pushed up by infrastructure bottlenecks and regional dynamics.

We have therefore tasked ACER to immediately prepare a price assessment tool. Our proposal grants them the necessary powers to collect real-time information on all daily LNG transactions. Based on this, they can establish a benchmark by the end of March.

Until then, we propose to create a market correction mechanism that could be used to limit prices when needed. We envisage it in the form of a TTF cap – a ceiling on the maximum value of the TTF Virtual Trading Point. More work is needed, in cooperation with the Member States, to develop the details. Me and my services are ready to complete this work fast and with the right safeguards, if given the mandate by the Council.

In addition, we aim to end the excessive volatility on EU energy derivatives markets. Mairead will tell you more about this in a minute.

As we make every effort to keep prices predictable and gas flowing to Europe, we cannot exclude a real supply crisis with a shortage of gas. For this, solidarity and demand reduction are key.

In the worst-case scenario, all our Member States need to be supported by their neighbours and countries with LNG facilities. Solidarity rules will apply automatically even if the Member States don’t have a bilateral agreement in place. Solidarity should be non-negotiable.

In addition to households and other protected consumers, solidarity obligation will now also apply to critical gas-fired power plants, to avoid an electricity crisis. In case of an emergency, there will be an allocation mechanism determining how gas is distributed and at what price.

It is also absolutely critical that we continue to reduce our gas demand. In today’s proposal, we give the Member States more flexibility to do this and continue work on other fronts. For example, this Friday, I will host with IEA executive director Fatih Birol an event on helping our small and mediumsized enterprises through the crisis. Energy savings and efficiency can play a key role in this.

Increasing our energy efficiency is also a central tenet of the Digitalisation of Energy Action Plan that the Commission adopted today. Many of the solutions touched upon there are relevant to our current situation: smart meters, remotely-controlled devices and innovative renewable solutions all make energy more affordable and accessible.

As we fight the current crisis, we are laying the foundations of a cleaner and more modern energy system which will serve us well in the years and decades to come.

Thank you.

 

_____

 

Commissioner Mairead McGuinness:

Thank you President, and Kadri.

Good afternoon everyone. Just to focus on the financial side of the energy issues. What we are doing today is working on the nexus between energy markets and financial markets.

And as you know my role as Commissioner, it has financial stability at its very heart.

So the measures we propose – and I will give you details shortly – are both targeted and time-limited.

And they are focusing on easing the liquidity stress that some energy companies have faced in meeting their margin requirements, and on tackling the extreme price volatility on energy derivative markets.

In doing this we worked really closely with our regulators – so ESMA and national regulators – and sought their guidance as to how we could do this, mindful of the need to address the liquidity issues, but clearly mindful of the need for financial stability.

And I want to thank our finance ministers for their contribution, and indeed our work with the European Parliament is paramount to deliver.

So first I want to deal with the trading side. We’re proposing a temporary measure as part of the emergency instrument: a so-called “intra-day price spike collar”.

Now what this is about smoothing out is smoothing excessive volatility and price spikes in gas and electricity derivative markets.

It is a price collar that limits extreme changes in a short period of time.

And in that sense, it is not intending to prevent prices from moving upwards or indeed downwards, but rather to ensure that these movements are more incremental than what we observed at some times over the past months.

EU trading venues for energy derivatives will have to put such a tool in place by the end of January, under the control of national and European regulators.

But in the interim period, we will be asking EU trading venues to set up an intraday volatility tools that would broadly achieve the same result.

My second point is on the issue of collateral.

We know some energy market participants have experienced pressures on liquidity because of higher margin calls linked to rising energy prices.

Usually collateral is provided in the form of cash.

Today we are adopting a delegated act that expands the list of what these companies can use as collateral. We are doing this on a temporary basis.

Energy firms will be allowed to use uncollateralised bank guarantees.

And all market participants will be allowed to use public guarantees.

Again we’re following the advice of ESMA on this, and striking the right balance between helping energy operators and maintaining financial stability.

The third measure is also related to energy derivatives markets.

And this is an amendment to another delegated act for energy firms using OTCs – over the counter – derivatives.

We are raising the clearing threshold from €3 billion today to €4 billion.

And below this €4 billion threshold, firms using over-the-counter derivatives will not have to provide margins for the bilateral trades.

And again, this is in line with ESMA’s recommendations, reflecting the sharp price rises in energy derivatives.

On benchmarks, I think Kadri you have covered that very well and we work together on achieving the proposal you have outlined.

And clearly, also, to encourage when the benchmark is in place, that it is used so that it will impact derivative markets as well.

I believe that what we are proposing today on the nexus between the financial markets and energy will make a real difference to energy operators and to energy markets.

And in the short to medium term, that will help alleviate pressure on consumers and businesses who are experiencing energy price rises right now.

But at the same time, we are staying vigilant when it comes to financial stability.

Thank you.

 

The press release issued by the European Commission on 12 October 2022.

Today, the European Commission adopted its 2022 Enlargement Package, providing a detailed assessment of the state of play and the progress made by the Western Balkans and Türkiye on their respective paths towards the European Union, with a particular focus on implementing fundamental reforms, as well as clear guidance on the reform priorities ahead.

The Commission recommends that Bosnia and Herzegovina be granted candidate status by the Council, on the understanding that a number of steps are taken to reinforce democracy, functionality of state institutions, rule of law, the fight against corruption and organised crime, guarantee media freedom and migration management in the country. The Commission will continue supporting reform efforts and accelerate the integration of the Western Balkans as a whole.

EU High Representative for Foreign Affairs and Security Policy/Vice-President of the European Commission, Josep Borrell, said: “We are recommending today to the Council to grant candidate status to Bosnia and Herzegovina. We are infusing a positive dynamic into the process and hope for the region to take the chance and follow up on it by implementing key reforms. We are not only assessing the performance of partners, but of future member states. The assessments we make now are also about the kind of Union we want for the future. And it is clear that we believe in the European future of our partners. Russia’s brutal invasion of Ukraine brings into strong relief the importance of EU enlargement, which takes on a new geopolitical significance. It is a long term investment into peace, prosperity and stability for our continent.”

Presenting this year’s Package, consisting of Communication on EU enlargement policy and annual reports, Commissioner for Neighbourhood and Enlargement, Olivér Várhelyi, said: “The enlargement policy of the European Union is a geostrategic investment in our European continent’s peace, stability, security, and socio-economic growth. Our reports offer a factual and fair assessment and a clear guidance precisely to allow our partners to identify where they need to go faster in reforms to move ahead. There is no alternative, and it is in our common interest to accelerate the integration process, starting with the Western Balkans, where we have been investing for many years to bring them closer to the EU. The recommendation to grant candidate status is a historic moment for the citizens of Bosnia and Herzegovina. I urge the leaders of the country to make the most of this historic opportunity and swiftly proceed with the steps identified in our recommendation. This will restart the work on reforms and on the fulfilment of the 14 key priorities set in the Commission’s Opinion which remain key for the opening of accession negotiations.”

Western Balkans

In the case of Montenegro, the priority for further overall progress in negotiations remains the fulfilment of the rule of law interim benchmarks set under chapters 23 and 24. To reach this milestone, Montenegro needs to intensify its efforts to address the outstanding issues, including in the critical areas of freedom of expression and media freedom and fight against corruption and organised crime and credibility of the judiciary. This requires political stability and constructive engagement by all stakeholders, leading to the establishment of a stable government and broad political consensus in Parliament on key reforms.

Serbia should as a matter of priority establish a government, firmly committed to the EU strategic direction and reform path. Further work and political commitment are needed to continue and deepen reforms and address shortcomings, in particular in the key areas of the judiciary, fight against corruption and organised crime, media freedom, freedom of assembly and the domestic handling of war crimes. Serbia also needs to improve as a matter of priority its alignment with EU foreign and security policy which dropped significantly. It also needs to robustly tackle all forms of disinformation.

Albania and North Macedonia opened a new phase in their relations with the EU following the first intergovernmental conferences on accession negotiations on 19 July 2022. Albania and North Macedonia need to further intensify efforts in key areas of rule of law, the fight against corruption and the fight against organised crime. Albania also has to address property rights, minority issues and freedom of expression.

In June 2022, the European Council expressed its readiness to grant the status of candidate country to Bosnia and Herzegovina and invited the Commission to report on the implementation of the 14 key priorities, with special attention to those that constitute a substantial set of reforms. Despite political turmoil and the general elections of 2 October, the leaders of the political parties represented in the Parliamentary Assembly of Bosnia and Herzegovina in June 2022 committed to principles for ensuring a functional Bosnia and Herzegovina that advances on the European path. Fulfilling the 14 key priorities from the Commission’s Opinion on the country’s EU membership application will allow recommending opening EU accession negotiations.

Kosovo needs to intensify its efforts to strengthen democracy, public administration, the rule of law and to fight corruption. The Commission stands by its assessment of July 2018 that Kosovo has fulfilled all visa liberalisation benchmarks and the proposal, still pending in the Council, should be treated as a matter of urgency.

On the normalisation of relations, while both Serbia and Kosovo have remained engaged in the Dialogue, the EU expects both sides to engage more constructively in the negotiations on the legally-binding normalisation agreement in the coming period and show flexibility in order to make rapid and concrete progress.

Türkiye

In the area of democracy, the rule of law and fundamental rights, Türkiye needs to reverse the negative trend as a matter of priority with addressing the weakening of effective checks and balances in the political system. Dialogue on rule of law and fundamental rights remains an integral part of the EU-Türkiye relationship. The underlying facts leading to the assessment that Türkiye’s accession negotiations have effectively come to a standstill, still hold.

The European Council has repeatedly re-affirmed its strategic interest in a stable and secure environment in the Eastern Mediterranean and in the development of a cooperative and mutually beneficial relationship with Türkiye. However, the situation in the Eastern Mediterranean has again become tenser. Türkiye must respect the sovereignty and territorial integrity of all EU Member States.

Türkiye’s continued policy of not aligning with restrictive measures against Russia is of concern due to the free circulation of products, including dual use goods, within the EU-Turkey Customs Union. Türkiye also needs to take decisive steps to improve alignment with EU CFSP, including EU restrictive measures, and avoid actions that go against its stated objective to join the EU.

Türkiye remains a key partner for the European Union in essential areas of joint interest, such as migration, counterterrorism, economy, trade, energy, food security and transport. High-level dialogues and intensified engagement in these areas continued. Türkiye has facilitated dialogue between Russia and Ukraine and played a key role in the agreement on the export of grains, although it has also decided to increase trade and financial relations with Russia.

Next steps

It is now for the Council to consider today’s recommendations of the Commission and take decisions on the steps ahead.