Russian gas price cap no solution to EU energy crisis: Prague

by IANS |

Prague, Sep 8 (IANS) The Czech Republic, which currently holds the rotating Presidency of the Council of the European Union (EU), wants to remove capping Russian gas prices from the agenda of this Friday's meeting of the European Union (EU) member states' energy ministers, the country's Industry and Trade Minister Jozef Sikela has said.


Speaking to the Senate's Committee on National Economy, Sikela called the cap a "political instrument" and argued that setting a limit on prices will not help Europe through the ongoing energy crisis, Xinhua news agency reported.


"In my opinion, this is an unconstructive proposal. It is more about another variant of sanctions against Russia than a current solution to the energy crisis in Europe. And now we don't want to prepare further sanctions but to solve the energy situation," Sikela said.


He said the Czech Republic would prefer a model that would separate the gas market from electricity prices. This, he said, could significantly lower the price of electricity per kilowatt hour but warned that it could lead to an increase in gas consumption.


Another option presented by the European Commission would be to cap prices for other forms of energy besides gas, such as nuclear power. The Czech EU Council Presidency might also consider tax breaks for energy manufacturers and distributors to ease overhead, according to the Czech News Agency.


In addition, the country wants to discuss limits on the sale of climate credits used in the EU Emissions Trading Scheme (ETS).


However, even if a European solution is reached on Friday, the minister said this will not be enough to help his country's citizens. "Therefore, we have almost prepared a set of measures to regulate and intervene in energy prices. These will be aimed at all groups of consumers -- households, public services and the corporate sector," he said.


The Czech government already approved a plan last month worth 177 billion Czech crowns ($7.15 billion) aimed at easing the burden on consumers.


The country's inflation reached 17.5 per cent in July, according to figures published by the Czech Statistical Office (CSU), with most of this rise attributed to soaring energy costs.


According to a theoretical analysis conducted by the Czech Finance Ministry, an embargo on Russian gas would hurt the Czech economy next winter. It shows that the country's gross domestic product (GDP) in 2023 would fall by up to 2.9 per cent in that scenario and then by up to 1.6 per cent in 2024. This year, however, households and industry would not be in danger thanks to sufficient reserves.


Still, experts say people are worried about the future. Last Saturday saw a massive demonstration in Prague attended by 70,000 people, according to local police. They demanded the resignation of the current government, military neutrality and negotiations with gas suppliers -- primarily with Russia -- to alleviate the burden of high energy prices. 

Latest News
Pressure mounts on rape accused K'taka Lingayat seer to step down Thu, Sep 29, 2022, 05:08 PM
People know who's 'uniting' country and who's dividing it: Bommai on 'Bharat Jodo' Thu, Sep 29, 2022, 04:46 PM
Yediyurappa hits out at Siddaramaiah for demanding ban on RSS Thu, Sep 29, 2022, 04:44 PM
New Zealand opens national wine centre to boost industry Thu, Sep 29, 2022, 04:43 PM
No budget surplus for at least 3 years: Aus Treasurer Thu, Sep 29, 2022, 04:42 PM
Had to pitch the ball in the right places and it worked well: Arshdeep Singh Thu, Sep 29, 2022, 04:08 PM
TRP scam spooks again: ED books 16 for money laundering; 'exonerates' Republic TV Thu, Sep 29, 2022, 03:55 PM
Cong prez poll: MLAs from MP to reach Delhi to back Digvijaya Thu, Sep 29, 2022, 03:32 PM
Kerala HC asks PFI to deposit Rs 5.20 cr for damage during bandh Thu, Sep 29, 2022, 03:30 PM
Yemeni govt receives UN proposal for 6-month truce extension Thu, Sep 29, 2022, 03:04 PM
S.Korean Prez, Kamala Harris share concern over N.Korea Thu, Sep 29, 2022, 03:00 PM
First NCW chairperson Jayanti Patnaik passes away Thu, Sep 29, 2022, 02:49 PM
Nadda in Odisha to address workers, visit Jagannath temple Thu, Sep 29, 2022, 02:39 PM
Surat will soon be known as 'Electric Vehicle city', says PM Thu, Sep 29, 2022, 02:18 PM
Digvijaya to file nomination for Cong prez polls Thu, Sep 29, 2022, 02:17 PM