Von der Leyen made a speech on “State of the Union” at the European Parliament (EP) General Assembly session held in Strasbourg.
Referring to the energy crisis in Europe, von der Leyen emphasized that energy infrastructure investments have a cost, but the cost of dependence on fossil fuels is higher.
“We need to rid Europe of its dependence on fossil fuels,” von der Leyen said. said.
Pointing out that the EU’s natural gas tanks have reached 84 percent fullness, von der Leyen said, “We are above our target, but unfortunately this will not be enough.” he said.
Pointing to the importance of directing natural gas supplies to other reliable suppliers such as the USA, Norway and Nigeria instead of Russia, von der Leyen stated that the EU bought 40 percent of its natural gas from Russia last year, and this rate has decreased to 9 percent recently.
“We see that Russia continues to actively manipulate our energy market,” said von der Leyen, adding that Russia preferred to burn gas instead of sending it to Europe in accordance with existing contracts.
Von der Leyen stated that energy bills in Europe increased 10 times compared to before the Kovid-19 epidemic, and said that high bills are a cause for concern for millions of businesses and households in the EU.
Pointing out that reducing electricity demand during peak hours will drive prices down, von der Leyen said, “Therefore, we are taking measures for member states to reduce their total electricity consumption.” said.
Von der Leyen, drawing attention to the need for targeted support in energy, said, “We propose a ceiling on the revenues of companies that produce electricity at low cost.”
Reminding that low-cost electricity producers have made extremely high profits recently, von der Leyen stated that they will apply an upper limit to these revenues.
“In this era, it is wrong to make extraordinary record revenues and profits by taking advantage of war and riding on the backs of our consumers. In these times, profits must be shared and directed to those who need it most.” made its assessment.
Underlining that their proposals also include those producing electricity from fossil fuels, von der Leyen pointed out that fossil fuel companies will also have to contribute to this process.
Von der Leyen drew attention to the fact that these are urgent and temporary measures and emphasized that member countries will obtain more than 140 billion Euros in these contributions.
FOUNDATIONAL CHANGE IN MARKETS
Von der Leyen stated that they continue to work on the ceiling price application for natural gas, and that the very expensive nature of energy harms the EU’s global competitiveness.
Von der Leyen said, “Today, our gas markets use more liquefied natural gas (LNG) than pipeline gas. However, the reference price TTF used in the gas market did not adapt.” said.
Von compiler said that the commission will try to establish a more accurate benchmark for electricity trade, adding that this will more accurately reflect the changes in the market.
Von der Leyen stated that energy companies in the electricity futures markets have serious problems with liquidity and that they plan to alleviate the problem by changing the collateral rules.
Pointing out that they will also take measures to limit intraday price volatility in these markets, von der Leyen emphasized that they will make changes in October to provide public assistance to these companies.
Von compiler noted that the current electricity market is no longer fit for purpose. he said.
THE IMPORTANCE OF HYDROGEN
Emphasizing that hydrogen can completely change Europe’s energy situation, von der Leyen reminded that they set a target of producing 10 million tons of renewable hydrogen by 2030.
Von der Leyen pointed out the importance of establishing a new hydrogen market in order to meet the hydrogen target and fill the investment gap in this area.
Von der Leyen stated that they will establish a European hydrogen bank and noted that 3 billion euros will be invested to help build the hydrogen market.
EU member states’ energy ministers held an extraordinary meeting in Brussels last week after Russia indefinitely cut off natural gas shipments to Europe through the Nord Stream pipeline.
At the end of the meeting, EU countries tasked the EU Commission to quickly prepare legislative proposals that include limiting the revenues of low-cost electricity producers, receiving contributions from fossil fuel companies, imposing a ceiling price on natural gas, reducing electricity demand and providing liquidity to energy companies.
NEEDS NEW FINANCIAL RULES
“We have to accept that high public debt is a new reality.” Von der Leyen said, emphasizing that there is a need for new fiscal rules in the EU that will protect financial sustainability and enable strategic investments to be made.
Von der Leyen pointed out that the new fiscal rules will be designed in accordance with the challenges that will arise in the coming years and that they will announce new ideas in this field in October.
Stressing the importance of establishing simpler fiscal rules that everyone can follow, von der Leyen said, “Member states should have more flexibility in their debt reduction processes.” used the phrase.
According to EU rules, budget deficits of member states should not exceed 3 percent of their GDP and public debt should not exceed 60 percent of their GDP under normal conditions. When this limit is exceeded, the measures to be implemented must be notified to the EU Commission and an effective fight must be made.
However, EU member countries decided to suspend the rules due to the epidemic and rapidly increased their budget deficits and public expenditures.
Von der Leyen pointed out that they will also prepare a new SME aid package.
Emphasizing that they will prepare a proposal for a single set of tax rules for doing business in Europe, von der Leyen said that this would facilitate trade, reduce bureaucracy and increase dynamism within the EU.
‘EUROPE NEEDS EXTERNAL WORKERS’
Von der Leyen also touched upon the need for skilled workers in Europe. Stating that the unemployment rate in Europe is 6 percent and that although this is a very good rate, many vacancies could not be filled, von der Leyen emphasized that workers from outside the EU should come.
Von der Leyen called on EU countries to have workers’ qualifications recognized faster in Europe.
Emphasizing that the EU should not make the mistake of dependence on fossil fuels in critical raw materials and mines such as lithium, von der Leyen said, “Lithium and rare elements will be more important than oil in the future.” said.
Von der Leyen said they need to establish new partnerships with like-minded countries, find “reliable partners” to prevent addiction.