The European Union will launch a “deep and comprehensive reform” of the electricity market, which is “no longer fit for purpose”.
which includes a price cap on Russian gas, a windfall tax on fossil fuel companies' profits, a limit on revenues of renewable and nuclear companies, a mandatory target for reducing peak hour energy use by 5% and emergency credit lines for power companies.to disregard existing contracts and shut off energy supplies to Europe completely after the plan was announced.
Addressing the windfall tax and revenue cap plans, Von der Leyen said that while profits were not necessarily a bad thing,"it is wrong to receive extraordinary record revenues and profits benefiting from war and on the back of our consumers."Tax on fossil fuel profits would provide 140 billion euros to be split between member states for energy bill support, she added.
Von der Leyen said a priority for the bloc must be on ending its dependency on Russian gas, with imports from the country already falling from 40% last year to 9% now.But, she continued:"This will not be enough. We have to diversify away from Russia to reliable suppliers like the United States, Norway, Algeria and others," as well as investing more heavily in renewables and LNG terminals.
She noted millions of households and businesses across the European Union were struggling with price rises and were fearful for the future.