EU proposes emergency brake on gas prices

The European Commission, the executive body of the European Union (EU), has proposed an emergency brake to be triggered if natural gas prices rise significantly from current levels. The aim is to limit the growing economic damage from cuts in Russia’s energy supply.

With this emergency brake, the European Commission will cap gas prices at €275 ($400) per megawatt hour. That’s well above the current price of around €120, but below the highs reached this summer.

Activation of the emergency brake is limited to strict conditions. Some countries have long opposed the setting of a ceiling price, citing the risk of difficulty in securing gas from new sources, so it appears that the effort was made to ease resistance.

“It’s not a silver bullet that solves the problem instantly, but it’s a powerful tool that can be used when needed,” European Commissioner for Energy Simon Simson told reporters. “The mechanism has been carefully designed so as to remain effective and not jeopardize supply security, the functioning of the EU’s energy markets and financial stability,” he said.

An emergency brake on gas prices has been the subject of months of debate and division in the EU. The proposal is still subject to government approval.

Original title:EU Plans Emergency Brake on Gas Prices as Russia Squeezes Again(抜粋)