FranceĀ andĀ Spain on Wednesday, Nov. 23, lambasted the European Commissionās proposed priceĀ capĀ on wholesale naturalĀ gas, set so high that critics have questioned if it would ever be used.
TheĀ EU executive on Tuesday, Nov 22, unveiled a gasĀ āsafety ceilingā of 275 euros per megawatt hour as the bloc grapples with high energy prices spurred by Moscowās war in Ukraine and supply cuts.
But the conditions meant theĀ capĀ would only kick in whenĀ EUĀ gasĀ prices breach that threshold for two weeks running, calculated on advance purchases through the blocās mainĀ gasĀ priceĀ benchmark, TTF.
TheĀ capĀ was also contingent on the TTFĀ priceĀ for liquefied naturalĀ gasĀ ā an easily transportable form ofĀ gasĀ that can be shipped worldwide ā exceeding 58 euros for 10 days within that same two-week period.
The only time the TTFĀ gasĀ priceĀ has gone above the 275-euro limit was between August 22 and 29 this year.
It was running at around 120 euros in trading on Tuesday.
Spanish ecological transition minister Teresa Ribera called the commissionās proposal a ājokeā, saying it would cause steeperĀ priceĀ hikes and hamper efforts to tame decades-high inflation.
The French energy transition ministry criticised an āinsufficientā scheme that ādoes not respond to the reality of the marketā.
āThe commission must propose an operational text, not simply a text that is political grandstanding and may have negative or no effects,ā it said.
Spanish Prime Minister Pedro Sanchez has also expressed his opposition to the plan, with Ribera saying mostĀ EUĀ members were against it as the blocās energy ministers prepare to meet on Thursday.
SpainĀ could stop supporting other proposals on matters important to the commission if another āseriousā text is not forthcoming, Ribera added.
A commission spokeswoman said the mechanism was designed āto anticipate and prevent this situation happening in the futureā, but admitted even AugustāsĀ priceĀ spike would not have triggered it.
TheĀ cap, if adopted, would come into force in January and came after months of wrangling betweenĀ EUĀ countries.
It runs alongside a plan by member states to voluntarily cut naturalĀ gasĀ use by 15 percent over the northern hemisphere winter.
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