European leaders have acknowledged the need for additional, immediate measures to tackle soaring energy prices in the final conclusions of Thursday’s (15 October) European Council summit, published in the early hours of Friday (16 October). The development follows pressure from Greek Prime Minister Kyriakos Mitsotakis for changes to European energy policy and greater flexibility in supporting households and businesses.

Meanwhile, Greece and five other countries are preparing a joint intervention to postpone the implementation of the new Emissions Trading System (ETS2) until at least 2030, according to Politico.

What the 27 EU leaders agreed on energy – Further measures from the European Commission

In the final conclusions of the European Council, published shortly after midnight following difficult and lengthy negotiations, tackling energy costs emerged as a key priority in efforts to strengthen European competitiveness.

European leaders called for additional short-term measures to address high energy prices, with particular consideration for the differing circumstances of member states and disparities in electricity costs.

The final text states:

“The European Council calls on the Commission to examine and, where necessary, propose further measures to address soaring energy prices in the short term, taking into account the specific circumstances of member states, including differences in electricity prices.”

This reference is particularly significant for Greece, as the Greek government has repeatedly highlighted substantial differences in electricity prices across European markets and called for a more flexible European response to the energy crisis.

The conclusions also stress that measures to tackle high energy costs must be combined with the continuation of the energy transition and the preservation of the European economy’s competitiveness.

Postponing methane obligations, state aid and measures for refineries

In the same document, the European Council welcomed the European Commission’s proposal to postpone certain obligations arising from the Methane Regulation, as part of efforts to limit the burden on the European economy.

The 27 leaders also welcomed the Commission’s intention to extend the temporary state aid framework for industrial sectors most severely affected by high energy costs.

The measures outlined in the conclusions include the Commission’s intention to develop a short-term framework to optimise the capacity and efficiency of refineries across the European Union, as well as initiatives to facilitate the voluntary aggregation of energy demand.

Particular emphasis was also placed on reducing administrative and regulatory burdens, especially for small and medium-sized enterprises. The European Council called for simpler and faster licensing procedures and the removal of unnecessary bureaucratic requirements.

Greece and five other countries seek to postpone ETS2 until 2030

Meanwhile, six European Union member states are preparing a joint initiative to further delay the implementation of the new Emissions Trading System (ETS2), according to Politico.

The countries are Greece, Italy, Poland, the Czech Republic, Hungary and Slovakia. They want the system’s launch postponed until at least 2030, citing the energy crisis and differences in electricity prices between member states.

Five European diplomats confirmed to Politico that a joint letter was being prepared. The initiative comes despite the full implementation of ETS2 already having been postponed from 2027 to 2028. The governments involved consider this delay insufficient to protect households and businesses from additional energy costs.

The planned intervention is also a response to an initiative by Nordic countries, which on Thursday morning backed the continuation and support of the Emissions Trading System.

However, according to one of the diplomats, the contents of the joint letter had not yet been finalised, and a revised version was expected, potentially incorporating further comments from Italy.

What is ETS2 and how will it affect households?

ETS2 is the European Union’s new carbon dioxide emissions trading system. It primarily covers fuels used in road transport and building heating, as well as certain additional sectors, including smaller industrial activities. Its aim is to reduce greenhouse gas emissions by making the use of fossil fuels more expensive and encouraging a shift towards cleaner energy sources.

In practice, companies supplying petrol, diesel and heating oil will be required to surrender emissions allowances corresponding to the carbon dioxide associated with these fuels. The additional cost could be passed on to consumers, leading to higher fuel and heating prices.

Full implementation of the system is scheduled for 2028. However, Greece and five other countries want it postponed until at least 2030, citing already high energy prices and the risk of further costs for households and businesses.

Mitsotakis: “We risk the deindustrialisation of Europe”

During the summit discussions, Mitsotakis strongly pressed for a review of key features of the European Union’s Emissions Trading System (ETS), warning of the consequences of maintaining it without substantial adjustments.

According to a Greek official cited by Politico, who relayed the prime minister’s remarks during the closed-door meeting, Mitsotakis warned that European industry faced serious risks.

“Without a significant revision of the Emissions Trading System, we risk the deindustrialisation of Europe,” he stressed.

The prime minister clarified that he did not question the system’s fundamental role in the EU’s decarbonisation strategy, but argued that it needed to be adapted to current realities.

“Although it must remain a key pillar of the EU’s decarbonisation strategy, it cannot operate as if the world has not changed since it was adopted,” he said.

Mitsotakis calls for action on energy costs and support for households

Mitsotakis also expressed strong dissatisfaction with the initial draft of the summit conclusions, arguing that it failed to reflect the scale and urgency of the energy crisis.

“The conclusions, in their current form, do not reflect the urgency of the energy crisis,” he said, according to the Greek official who spoke to Politico.

The Greek intervention also focused on the need for greater fiscal flexibility, allowing member states to provide more effective support to citizens and businesses affected by high energy costs.

“We need greater flexibility within the existing fiscal framework so that we can provide targeted, tailored and temporary support measures for vulnerable households and businesses,” he stressed.

The final conclusions’ references to additional short-term measures and the specific energy circumstances of member states align with Greece’s calls for a more effective European response. However, they do not amount to a decision to introduce new support measures immediately. The Commission has first been asked to assess the need for further action and, where necessary, put forward proposals.

Similarly, the relevant passages of the final conclusions do not record a decision to postpone ETS2 until 2030, as the six countries are seeking. That request remains a separate initiative within the wider European negotiations on energy policy.