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The European Commission today presented an action plan with short-term measures to reduce the energy costs faced by households and industries, to complete the Energy Union, attract investments, and better prepare for potential energy crises.
Consumers are already benefiting from approximately €34 billion annually thanks to the EU’s internal energy market. With today’s action plan, the Commission estimates that for households and industries facing high production costs, a total amount of €45 billion will be saved by 2025, which will gradually increase to €130 billion annually by 2030 and €260 billion by 2040.
President Ursula von der Leyen stated: “We are turning energy prices down and competitiveness up. We have already significantly reduced energy prices in Europe by doubling renewable energy sources. Now, we are taking a step further with the action plan for affordable energy within the framework of our clean industry agreement. With this, we will achieve more predictable prices, stronger connections across Europe, and an increase in energy absorption. We will systematically remove remaining obstacles so that we can build a true Energy Union.”
REDUCING ENERGY COSTS FOR IMMEDIATE RELIEF TO CONSUMERS DURING THE COMPLETION OF THE ENERGY UNION
To make electricity more affordable, the Commission will examine all three components of energy bills, namely network and system costs, taxes and charges, and supply costs. It will make recommendations to the member states to reduce national electricity taxes and provide consumers with easier access to switch suppliers for cheaper energy offers, among others. Based on existing EU electricity legislation, the Commission will also further support the adoption of long-term supply contracts, which ultimately contribute to decoupling retail bills from high and volatile gas prices. To reduce the network fee portion of energy bills, it will propose a methodology ensuring network fees reflect the cost of the energy system, providing incentives for more efficient network use.
In conjunction with support to achieve more and faster renewables, the Commission will also bring significant benefits to consumers by supporting the wider adoption of energy efficiency solutions, which can lead to savings of up to €162 billion annually by 2030. An EU guarantees system to be developed in collaboration with the European Investment Bank will help minimize investment risks in energy efficiency services and facilitate access to more efficient appliances and longer-lasting products.
Gas prices in the EU are excessively high and affect the competitiveness of European industry. To ensure fair competition, the Commission will intensify monitoring of the EU gas markets with the help of the Agency for the Cooperation of Energy Regulators (ACER), the European Securities and Markets Authority (ESMA), and national regulatory authorities. We will also work with reliable LNG suppliers to identify additional cost-competitive imports and leverage the Union’s purchasing power by pooling demand from EU companies.
The Commission concludes that deeper integrated, well-functioning, and decarbonized energy markets are the best shield against price instability. This is why the Commission will strive to complete the Energy Union, with more interconnection lines, a stronger network, and cross-border transactions, and will develop a series of initiatives to boost the electrification and decarbonization of the heating and cooling sectors, mobilize private capital, and further digitize the energy system, among others.
BETTER PREPARATION FOR POTENTIAL CRISES
Supply security is crucial to ensure prices remain stable. The Commission will update the EU’s energy security framework to address emerging threats, such as cyberattacks, critical infrastructure sabotage, and risks from import dependency. It will also strengthen readiness for a potential price crisis, including issuing guidelines to member states on how to reward consumers for reducing usage during peak periods and keeping energy bills under control. (26/2/2025)