Energy prices and the
EU response
Tom Howes, DG Energy
European Commission
…EU…
2014 report
What was driving electricity prices 2008-2012?
18%
17%
18.5%
7.5%
36%
-3%
30%
127%
Source: Eurostat. Includes taxes in the case of households; excludes VAT and other recoverable taxes in the
case of industry but other industry exemptions are not included (not available).
2
2014 report
..international..
EU electricity and gas prices
compared with major trading
partners
Electricity end-use prices for industry, 2012
Gas end-use prices for industry, 2012
Sources and notes: see p. 177 and 179 of SWD (2014) 20
3
Update…
..since January 2014..
2014 June Energy Council: Member States requested follow-up report by
2016
 Confirmed in Commission's 2015 Energy Union Strategy:
Biennial reports
 Initiative status: report to be adopted in 2Q 2016
•
Discussions with Eurostat, Eurelectric, others on data issues (details,
quality, sources…) -> Commission (Eurostat) legislative proposal
under discussion
•
Ad hoc data gathering exercise with Member States
•
Sluggish economic growth/subdued demand; increased supplies (oil,
gas, LNG; lower commodity prices generally)
4
GAS PRICES
USD/mmbtu
International wholesale gas prices: Convergence after the storm
25
20
15
Fukushima
March
2011
10
US gas revolution
5
0
1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11
2008
2009
2010
Henry Hub (US)
2011
NBP (UK)
2012
2013
Japanese landed price
2014
2015
5
International comparison of wholesale prices: EU versus US, Japan and Australia
200 €/MWh
180 €/MWh
160 €/MWh
140 €/MWh
120 €/MWh
100 €/MWh
80 €/MWh
60 €/MWh
40 €/MWh
20 €/MWh
0 €/MWh
1
3
5
7
2010
9
11
1
3
5
7
2011
Japan
9
11
1
3
5
7
2012
Platts PEP
9
11
1
3
5
7
9
11
1
3
2013
US price
5
7
2014
9
11
1
3
5
7
9
2015
Australia
6
ENERGY IMPORT BILL
(Estimated)
450
404
400
358
-11 %
350
billion Euros
300
293
271
264
-7 %
250
-26 %
Total
Oil
200
181
Gas
-33 %
Coal
150
100
95
74
50
16
-23 %
71
14
12
0
2013
2014
-4 %
2015
7
NEXT STEPS
•
2nd report on energy prices & costs
 Study started in October 2015
 +econometric analysis of drivers
 detail on price components
 Electricity, gas petroleum products included
 more detail on sectors and households; EU & international
coverage
 Other Commission work under way (esp. on energy intensive
industries, with further work by DGs CLIMA and GROW)
 Feedback from stakeholders: Industry Conference, contacts
with institutional actors (Jan/Feb/March)
 Final report of study (end of March)
 Commission internal work on documents April-May
 Adoption Summer 2016
8
Sub-components
Different industry consumption bands
Other
Other
Environmental taxes
and excise tax
Environmental taxes and
excise tax
Security of Supply
25.00
Retail price for electricity [€ct/kWh]
Retail price for electricity [€ct/kWh]
25.00
20.00
15.00
10.00
5.00
0.00
NL
DK
DE
ES
IT
PL
Security of Supply
20.00
Energy efficiency support
Energy efficiency
support
Market Operation
Market Operation
15.00
System operation
System operation
Nuclear
Nuclear
10.00
Social Tariff
Social Tariff
RES & CHP
RES & CHP
5.00
Network Component
Network Component
Energy Component
0.00
NL
DK
Energy Component
DE
ES
IT
PL
9
Close up look at energy
intensive industries
10