Energy, Italy gets gas price cap

Here comes the price cap. After months of negotiations, backtracking and delays, Member States finally approved the gas price cap, with Germany voting in favour, the Netherlands and Austria abstaining, while Hungary voted against.

The gas market correction mechanism, which will be operational from February 15th, will be activated upon the occurrence of two conditions: when the Amsterdam TTF Futures price for the following month is above 180 euros/MWh for three working days and when the Monthly TTF is 35 euros higher than the LNG reference price in global markets for the same three business days. Once activated, the dynamic supply cap will apply for at least 20 working days, while it will be automatically deactivated, at any time, if a regional or EU emergency is declared by the European Commission, for example, in case of insufficient supply. Prime Minister Giorgia Meloni applauds the result and defines it as “a small, big victory”. «We managed to win in Europe on the roof of the piece of gas. A battle that they gave up and instead we managed », she underlined. The government reaffirms the decisive role of the Prime Minister’s last speeches also at last week’s summit, but that of the price ceiling is a game that former Prime Minister Mario Draghi started on his own since the March European Council and which along the way it gathered the consensus of a growing number of Member States.

It was possible to vote by qualified majority and it turned out to be so, but in fact Germany, the historic opponent, was brought on board, with the Netherlands abstaining. “This is a first step towards a solution that will allow us to calm down the system of accounts”, said the Minister of the Environment and Energy Security, Gilberto Pichetto, at the end of the Council meeting. “There is particular satisfaction for Italy”, he recalled, “because the negotiation carried out last week by Prime Minister Giorgia Meloni ended with a mediation that satisfies the vast majority of European countries”. The minister does not forget the work done by Draghi but on merit he recalls that “there is no scale”. To the words of the Kremlin that defined the price cap as an “unacceptable” tool, which “contradicts market principles”, Pichetto replies: “I think Russia’s reaction is a demonstration that this cap has an effective effect”. The approval of the mechanism also paves the way for the adoption of the other two regulations that remained pending because the ministers decided to link them to the ok at the maximum price: the one on the joint purchase of gas and EU solidarity and the one on licenses for renewable energies. “These decisions will allow the EU to prepare for the coming winter more effectively and accelerate the deployment of renewable energies”, commented the President of the European Commission, Ursula von der Leyen.