One questionable idea from #SOTEU is the proposal to intervene in the #electricity markets rather than the #gas markets.
The EU spent decades building an electricity market to foster investment in #renewables, and succeeded
Doing this will likely destroy that market (1/n)
The EU spent decades building an electricity market to foster investment in #renewables, and succeeded
Doing this will likely destroy that market (1/n)
... because investors who turned to renewables will now see their profits capped while those who focused on gas will see record profits. This is compounded by member states rush to build new gas infrastructure to replace russian gas, and the taxonomy decision (2/n)
Von der Leyen's proposal will effectively remove all market incentives to invest in renewables on a large scale, and sends the market one clear message: invest in gas, that is where the money is.
So what should the commission hzv done? (3/n)
So what should the commission hzv done? (3/n)
The alternative was intervention in gas markets, which are much simpler than electricity markets.
Capping prices for residential consumers and electricity generators would also being down electricity prices without destroying the market, so why did the commission do this? (4/n)
Capping prices for residential consumers and electricity generators would also being down electricity prices without destroying the market, so why did the commission do this? (4/n)
Well, intervention in the gas markets would see gas prices for industry (metals, ceramics ,chemicals, etc) increase sharply.
There is no painless solution, but IMHO the decision to protect gas-dependant industry over renewables will hinder the green transition for decades (5/n)
There is no painless solution, but IMHO the decision to protect gas-dependant industry over renewables will hinder the green transition for decades (5/n)
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