I’ve got to admit it: Ursula von der Leyen is a pretty cool name, almost as cool as Annemiek van Vleuten, the Dutch cyclist who won the Tour de France Femmes this year. But Mrs von der Leyen isn’t a cyclist.
Energy crisis: Ursula von der Leyen calls for ’emergency intervention’ in electricity market
By Jorge Liboreiro • August 30, 2022
The worsening energy crisis besieging Europe has laid bare the “limitations” of the electricity market and requires an “emergency intervention” to bring down soaring prices, Ursula von der Leyen has said.
“The skyrocketing electricity prices are now exposing, for different reasons, the limitations of our current electricity market design,” the European Commission president said on Monday while addressing the Bled Strategic Forum in Slovenia.
“[The market] was developed under completely different circumstances and for completely different purposes. It is no longer fit for purpose.
“That is why we, the Commission, are now working on an emergency intervention and a structural reform of the electricity market. We need a new market model for electricity that really functions and brings us back into balance.”
It wouldn’t have anything to do with the European nations supporting Ukraine in its war against Russia with more than just words, would it?
Well, part of the pain is the European Union’s regulations setting the cost of electricity:
Today, the EU’s wholesale electricity market works on the basis of marginal pricing, also known as the “pay-as-clear market”.
Under this system, all electricity producers – from fossil fuels to wind and solar – bid into the market and offer power according to their production costs. The bidding starts from the cheapest resources – the renewables – and finishes with the most expensive ones, usually gas.
Since most EU countries still rely on fossil fuels to meet all their energy demands, the final price of electricity is often set by the price of gas. If gas becomes more expensive, electricity bills inevitably go up, even if clean, cheaper sources also contribute to the total energy supply.
The system was initially praised for boosting transparency and promoting the switch to green sources, but since late 2021, it has come under intense criticism.
In other words, all electric consumers are paying for sparktricity based on the cost of the most expensive means of production. That’s European socialism for you!
Of course, Russian’s invasion of Ukraine brought about swift sanctions against the bear, but the Russians hold the high cards here: Europe is dependent upon natural gas from Russia for fuel for power plants and winter heating. And much of democratic Europe is not east of the United States, but due east of Canada. Berlin, for example, is at approximately the same latitude as the southern border of Labrador. To quote Ned Stark, “Winter is coming.”
Natural gas futures are more than ten times what they were a year ago:
There’s no stopping Europe’s gas bills.
On Thursday, future gas prices at the Title Transfer Facility (TTF), the continent’s leading trading hub, reached €321 per megawatt-hour, a stratospheric figure compared to the €27 set a year ago.
The new all-time high follows a surprising announcement by Gazprom, Russia’s state-controlled energy giant, who last week said it would soon shut down Nord Stream 1 – which pipes gas from Russia to Germany – for a three-day maintenance operation, performed alongside Siemens.
Gazprom argues the pipeline must be checked for cracks, dents, leaks and other potential glitches.
European politicians have repeatedly accused the company of weaponising energy flows and exploiting technical questions as an excuse for piling pressure on countries at Vladimir Putin’s will.
Well, of course Russia is weaponizing energy flows. After all, some of the European nations are sending money and military equipment to Ukraine, to use to fight Russia. What else would you expect Russia to do? Vladimir Vladimirovich is attacking Europe that same way Europe is attacking him: economically. The only thing cannier Russia could do is keep sending limited, though slightly increasing, amounts of gas to Europe, keeping prices high but also lulling the Europeans to sleep, then, maybe around December 15th, Pow! shut it off completely.
The German government might think differently about sending military aid to Ukraine if the German people are freezing in their flats.
But you can’t say they weren’t warned!
Trump accused Germany of becoming ‘totally dependent’ on Russian energy at the U.N. The Germans just smirked.
by Rick Noack | September 25, 2018 | 2:44 PM EDT
BERLIN — Out of President Trump’s speech at the U.N. General Assembly on Tuesday, it probably won’t be the script that will be remembered by diplomats but, rather, world leaders’ laughter, caught on camera and shared in viral videos.
One of them captured the amused reactions of the German delegation as Trump said: “Germany will become totally dependent on Russian energy if it does not immediately change course. Here in the Western Hemisphere, we are committed to maintaining our independence from the encroachment of expansionist foreign powers.”
German Foreign Minister Heiko Maas could be seen smirking alongside his colleagues.
Who’s smirking now?
It wasn’t the first time Trump had lashed out at Germany over its gas imports from Russia.
During a NATO summit in July, he took aim at the Germans for the same reason, specifically singling out a planned 800-mile pipeline beneath the Baltic Sea called Nord Stream 2. “Germany, as far as I’m concerned, is captive to Russia because it’s getting so much of its energy from Russia,” Trump told NATO Secretary General Jens Stoltenberg, also speaking on camera at the time. “We have to talk about the billions and billions of dollars that’s being paid to the country we’re supposed to be protecting you against.”
Looks like President Trump, the hated, evil reich-wing fascist, was right all along, and the Europeans were what they have so often been, wrong. I will confess to being somewhat amused.
You don’t have to somehow like Russia’s invasion of Ukraine, or hope that Vladimir Putin wins, to have been bitterly opposed to the responses of the United States and Europe: I might want Ukraine to win, to throw out the Russian invaders, but I don’t want it so much that I’m happy that the world is closer to nuclear war over it.
