EU energy policy between emergency measures and energy transition legislation: do we need to fear for our liberalized gas market?

The European Green Deal, launched in 2019, is the European Union’s flagship decarbonization strategy. The Green Deal has put the EU on a path to climate neutrality by 2050, through the decarbonization of all sectors of the economy. In its new Climate Target Plan for 2030 the European Commission (Commission) has set an intermediate target of at least 55 per cent green house gas (GHG) emission reduction to be reached through a number of legislative actions. In July 2021, the Commission proposed its Fit for 55 package, followed in October 2021 by the proposal of the Gas and Hydrogen package which encompassed all the measures necessary to achieve the decarbonization targets. If adopted, it is the most ambitious and coherent decarbonization package ever seen. However, since 2021, the EU has experienced an unprecedented energy crisis with economic, social and geopolitical impacts, caused first by a strong increase in global demand after the lifting of COVID-19 restrictions and then dramatically exacerbated by Russia’s invasion of Ukraine, which led to substantially lower levels of pipeline gas deliveries to the EU and increased disruption of gas supply. The skyrocketing energy prices put enormous pressure on politicians which initially led to national actions such as the Iberian gas reference price model and the Greek regulated price mechanism, but was then followed by a complete set of emergency measures at EU level. Although the work of the EU co-legislators (the European Parliament (EP) and the Council) on the Fit for 55 package and the gas and hydrogen package continued, it is clear that the necessity for interventions at national and European level to combat the energy crisis have deflected attention away from energy transition legislation towards emergency measures. This Comment asks whether this is only a temporary phenomenon or whether this shift in attention and the deep market interventions of the emergency measures will have a more long-term impact on the functioning of the European internal energy markets.

By: Klaus-Dieter Borchardt