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Statement by Energy Intensive Industries on the outcome of the extraordinary energy council of 9 September 2022

Date

13 Sep 2022

Sections

InfoSociety

In its meeting of the 9th of September, the Energy Council acknowledged the pressure put by  the increase in electricity and gas prices on inflation and the EU economy, therewith  threatening the competitiveness of European companies.  

In its attached letter to the Czech Presidency of the EU issued on the 6th of September last  week, the energy-intensive industries referred to the destructive consequences of these market  developments which have already prompted a shut-down of plants or reduction of production  in many sectors. With every day that goes by, the situation grows worse with potential  irreversible consequences on investments in Europe.  

In this context, we unfortunately lack the sense of urgency in the series of measures discussed  at the Energy Council. Many of these measures require further elaboration, are worded in broad  and, at times, vague terms and are unclear as to their application to industry.  

We call upon Europe’s leadership to provide industry with immediate and precise relief  measures that can be implemented swiftly to ensure the continued viability of the operations in  Europe.

 
 

Minister of Industry and Trade 

Czech Presidency of the Council of the European Union 

Na Františku 32 

110 15 Praha 1 

Czech Republic 

Brussels, 6 September 2022

 

 

Dear Minister Jozef Síkela, 

Re: EU gas and electricity prices. Urgent EU actions are needed 

The undersigned energy intensive industries are representatives of a fundamental part of the  European economy which is severely impacted by the ongoing energy crisis. Given the market  concentration on the supply side, the volatility and extreme level of the European gas prices, one can  question whether the gas market is working. This situation has serious consequences also for the  electricity market.  

With the EU gas peaking at 334 €/MWh TTF spot prices two weeks ago, which is 15 times its pre-crisis  level, 10 times more than the US prices and well above the prices in Asia, it is clear that the relation  with a normal market is lost. Beyond the current impact on citizens through inflation, destructive consequences on gas and electricity industrial users are inevitable.  

The last weeks saw a great number of industrial plants shutting their doors or reducing their  production in Europe and more are expected in the forthcoming weeks. These massive plants  curtailments will increase Europe’s dependency on third markets for strategic supply chains and will  drastically increase the global carbon emissions.  

For many energy intensive industries there is currently no business case to continue production in  Europe nor visibility and certainty for investments and further developments. The effects of those  closures are also starting to have a severe impact on our value chains endangering European industrial  base and the availability of essential products more broadly.  

Immediate and impactful action is needed at European level, and we welcome your proactive role in  this regard. 

Therefore, ahead of the Extraordinary Energy Council of 9 September, we call on the European Union to urgently introduce EU-wide measures aimed at limiting the price of natural gas and also measures  designed to disconnect electricity prices from gas prices. The temporary crisis state aid framework  also needs to be adjusted to this new reality.

Thanking you for your consideration, we remain at your disposal should you have any question. Yours sincerely,

 

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