Commodities News

EU countries rewrite plan to cut gas demand, seek carve-outs

By Kate Abnett

BRUSSELS (Reuters) -European Union countries are seeking to soften the bloc’s plan to require them to use less gas as Europe prepares for a winter of uncertain supplies from its main gas supplier Russia.

The European Commission proposed last week that the 27 EU member states each cut their gas use by 15% from August to March. The target would be voluntary, but the Commission could make it binding in a gas supply emergency.

Brussels has urged countries to curb gas use now to help fill storage ahead of winter, and warned a full cut-off of Russian gas is likely. But the EU plan has faced resistance from a swathe of governments, with some flatly against binding cuts and others unwilling to let Brussels control their energy use.

Diplomats from EU countries were discussing a revised proposal on Monday, before their energy ministers attempt to strike a deal on it on Tuesday.

The proposal, seen by Reuters, would keep the voluntary target for all countries to curb gas use, but offer a range of exemptions to the binding target – effectively meaning countries would face different mandatory goals.

“Everyone has to contribute to the extent possible,” a senior EU diplomat said, adding the latest proposal should still nearly cover the gas demand gap of 45 billion cubic metres that Europe’s gas network operators have said a Russian cut-off would cause this winter.

Before it invaded Ukraine, Russia had supplied 40% of EU gas, or roughly 155 bcm per year.

Other diplomats raised concerns the proposal would fall short. EU countries have so far cut their combined gas use by just 5%, despite months of soaring prices and squeezed supply from Russia.

The latest proposal would exempt from the binding target countries without links to EU gas networks, such as island countries Ireland and Malta.

States with large volumes of stored gas could face lower targets, as could states that export gas to other countries, likely including Spain, which does not rely on Russia for gas and has criticised the EU proposal. Critical sectors such as chemicals and steel could also be exempted.

The new proposal would require majority support from countries to make the gas curbs binding. An initial proposal to put the Commission in charge of that process was opposed by counties including France, Italy, the Netherlands and Poland.

Polish climate minister Anna Moskwa said the idea of Brussels imposing gas limits on countries “is totally against the idea of energy security and democracy.”


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