The European Commission proposed changes to the EU’s electricity market in March after power prices soared to record levels last year. – AFPpicEuropean Union countries' energy ministers struck a deal to reform power market subsidies, Spain's energy minister said on Tuesday , defusing a stand-off between France and Germany over the future competitiveness of industrial sectors.
The deal struck on Tuesday focused on a section of the law spelling out how state aid can be used to support power projects. Talks had stalled for months because of concerns, especially from Germany, that the scheme could distort competition and favour France, which has the world's second biggest nuclear fleet after the US.
These contracts guarantee a minimum price for energy produced but also allows governments to recover excess revenues if prices jump past a set threshold. But in a nod to Germany, the proposals said the subsidies must be designed so that use of revenues raised, such as support for local industries, does not distort competition or trade in the EU.
“With the new electricity market design ... consumers in particular will benefit from the cheap production costs of non-fossil fuel energies. This is also important to ensure the transition to competitive prices in Europe.”