EU countries seek way out of impasse over gas price caps

The question of how, when and whether to cap gas prices will dominate another meeting of European Union nations on Wednesday as they pursue a common plan to target high gas prices that have eluded consensus for weeks.

As Europe enters a winter of scarce Russian gas, a cost-of-living crisis and the threat of a looming recession, the 27-nation EU is planning its next move to contain soaring energy prices and protect consumers from skyrocketing bills. "We need to find a quick solution that will apply to the whole European Union," a senior EU official said. "National solutions are not the way forward." EU energy ministers will meet in Prague on Wednesday to try to give clearer instructions on what the European Commission should propose as the bloc's next emergency energy measure. With gas prices almost 90% higher than a year ago, most EU countries say they want a gas price cap but disagree on its design. Some countries, including Germany, Europe's largest gas market, are opposed. Talks between EU leaders last week failed to clarify next steps. One EU diplomat said these discussions were "going in all directions" - referring to a multitude of options, including a price cap on all gas, pipeline gas or gas used only to generate electricity. Another EU diplomat said no "common signal" had emerged from the leaders' talks. "I would say expectations are low," the diplomat said of Wednesday's meeting. Others were more hopeful that a compromise would emerge. A senior EU official said countries were warming to the "Iberian model" of capping the price of gas used for electricity generation as a quick fix. Spain and Portugal introduced this plan in June and it has helped lower local electricity prices. While the idea has support among other countries, there are fears that Spain's gas use has increased as a result of the measure, increasing EU demand for gas. EU countries have already rushed through emergency energy profit taxes, gas storage refill obligations and electricity demand restrictions to cover rising energy prices due to Russia cutting gas supplies since its invasion of Ukraine. But pressure to agree on more measures across the EU has increased after Germany announced it will spend up to €200 billion to protect consumers and businesses from higher energy costs, prompting some countries to react to an uneven distribution of national support. Follow Global Economic Developments on Social Media! Click here to follow Ieconomy official Facebook account! Click here to follow Ieconomy official Instagram account! Click here to follow Ieconomy official Twitter account!