The Commission presents a toolbox to address high energy prices

On 13 October 2021 the European Commission presented the communication "Tackling rising energy prices: a toolbox for action and support" (COM(2021) 660). The document is a response to the sharp rises in gas and electricity prices in Europe. It contains a catalogue of measures that Member States can implement immediately, and announcements of medium- and long-term action. It does not, however, change the rules under which the energy market operates.

Short-term measures

The toolbox includes measures that countries can apply within the existing rules:

• income support for households at risk of energy poverty, including in the form of vouchers or subsidies;
• temporary reductions in taxes and charges on energy for consumers;
• support for businesses within the state aid rules;
• easier payment of bills for businesses.

The Commission encouraged countries to use them in line with their national budgetary capacity.

Medium- and long-term measures

In the longer term the Commission indicated directions for action: accelerating the development of renewable energy sources, improving energy efficiency, expanding energy storage and grids, and reviewing the rules of the gas market. It also announced analyses of how the market works, including gas storage, and work on reforming the EU framework for renewable and low-carbon gases, which was to be presented in the gas package in December 2021.

Significance for biogas and biomethane

The toolbox recognises renewable gas as part of the long-term response to the crisis, but specific instruments for biomethane were deferred to the legislative work. For biogas producers it is important that energy prices support the profitability of projects, and that aid for consumers should not distort price signals. For farms, meanwhile, rising fertiliser and energy costs increase interest in using their own resources, such as manure and slurry, to produce energy.

Poland's perspective

Poland was among the countries that pressed for the quick launch of national and EU mitigating measures, including protecting households against rising bills. For countries with a large share of gas in heating and power generation, and with large fertiliser production, the price crisis became an argument in the debate on the pace and cost of the transition.

What next

The Commission announced further analyses and action within the Energy Council. For the biogas industry, what mattered was the expectation of the gas package, which was to define renewable and low-carbon gases and set the rules of grid access.

Limits of the tools

The set of measures is primarily advisory: it indicates what countries can do within the existing rules and does not force specific decisions. Its effectiveness depends on countries' budgetary capacity and on whether the immediate measures overlap with long-term action. Critics pointed out that subsidising bills alleviates the effects but does not change the causes of high prices, such as dependence on gas imports.

Impact on investment decisions

In conditions of price uncertainty, investors more often consider projects based on local resources. Biogas and biomethane produced from waste and agricultural residues do not depend on fuel imports, which increases their strategic value, although profitability still depends on support mechanisms and feedstock costs.