EU countries are making a final push for an agreement on the gas price cap this year. From Health & Fitness Journal

©Health & Fitness Journal. FILE PHOTO: European Union flags flutter in front of the European Commission headquarters in Brussels, Belgium September 28, 2022. REUTERS/Yves Herman//File Photo

By Kate Abnett

BRUSSELS (Health & Fitness Journal) – Energy ministers from European Union countries meet in Brussels on Monday to try to agree a cap on gas prices – their latest idea to tame Europe’s energy crisis but one countries are still over are split.

Country leaders last week urged their ministers to approve the cap on Monday, completing a measure countries have been debating for months and holding two emergency meetings.

They are now considering a new compromise proposal from the Czech Republic, which holds the rotating EU Council Presidency.

The draft, seen by Health & Fitness Journal, would trigger a cap if prices for the Dutch gas hub Title Transfer Facility (TTF)’s front-month contract exceed €188 per megawatt-hour for three days – far below a previously proposed €275/MWh threshold by the European Commission Last month.

About a dozen countries, including Belgium, Poland and Greece, have called for a cap below EUR 200/MWh to deal with high gas prices, which have skyrocketed citizens’ energy bills and triggered record inflation this year , after Russia halted most of its gas supplies to Europe.

But Germany, the Netherlands and Austria are among those who fear the cap could disrupt European energy markets and divert much-needed gas loads out of the EU. They want stricter conditions, such as automatically suspending the cap if it has unintended negative consequences.

With some countries’ positions still unclear, some EU diplomats said both sides may have enough votes to block a deal.

Under the latest proposal, the EU gas price cap, once triggered, would prevent front-month-to-front-year trading of TTF contracts at a price in excess of EUR 35/MWh above a reference level derived from liquefied natural gas (LNG) price assessments.

The EU price cap would not drop below 188 eur/MWh even if the LNG price dropped to a much lower level. If the LNG reference price were to rise to a higher level, the EU cap would move with it, while remaining 35 EUR/MWh above the LNG price – a system designed to ensure the block can bid above market prices, to attract scarce fuel.

The fate of other EU energy policies also depends on the gas price cap. Countries could approve faster permits for renewable energy projects on Monday, after twice delaying approval pending an agreement on the cap.

Ministers will also seek to endorse their negotiating position on a new EU law to reduce planet-warming methane emissions. Documents seen by Health & Fitness Journal show some countries are trying to weaken proposed rules for oil and gas companies.