Energy prices

Citizens often turn to the European Parliament to ask about what the European Union is doing to help ensure access to affordable energy.

The responsibility for energy policy is shared between the European Union (EU) and its member countries. While the EU is responsible for ensuring a functional energy market and a secure energy supply, the choice of energy sources and the supply structure are decided at national level. As a result, the EU is able to set general guidelines and standards, but EU countries have a lot of control over how they apply them.

Energy prices have been rising, especially since the Russian war in Ukraine. The European Union is taking short and long-term measures to stabilise energy prices, provide financial funding and to ensure energy security and access to green energy for its citizens.

Stabilising energy prices and financial funding

The EU has been working closely with EU countries to find quick solutions to stabilise energy prices. In December 2022, the Council adopted a regulation to protect citizens and the economy against high prices. The regulation aims to limit episodes of excessive gas prices in the EU, while ensuring secure energy supplies and market stability.

The European Parliament has repeatedly raised concerns over rising energy costs (October 2022, September 2022, July 2022, March 2022) and advocated for emergency measures to ease the pressure on European households and businesses. In October 2022, Parliament also suggested that EU countries combat rising energy prices

The European Parliament also highlighted that companies benefitting from windfall profits should help to mitigate the negative impacts of the crisis. Parliament called on the European Commission to examine if other measures, like temporary wholesale and price caps, are needed.

Energy security and import dependency

The EU is working on long-term measures to ensure EU energy security and reduce energy dependency on Russia.

In this context, Parliament stressed the importance of rapidly securing cleaner and more affordable energy for all EU countries. It supported the immediate and full embargo on imports of Russian oil, coal, nuclear fuel and gas, and called for the Nord Stream 1 and 2 pipelines to be abandoned.

In June 2022, the EU adopted updated the rules aimed at safeguarding EU gas supplies. Long-term measures include requiring EU countries to fill their gas storage to at least 90 % capacity for winter 2023; diversifying gas supplies; and increasing EU production of renewable hydrogen.

The REPowerEU Regulation, which was adopted in February 2023, aims at ensuring affordable, secure and sustainable energy for EU citizens and businesses. The plan includes short- and medium-term measures, such as investing €210 billion until 2027 to phase out Russian fossil fuel imports. The aim is to focus on national recovery and resilience plans that aim for faster energy independence, to tackle energy poverty and to decarbonise the European economy.

Promoting green energy

The EU is committed to promoting sustainable energy to achieve its climate goals and to stabilise energy prices by decreasing the EU’s reliance on fossil fuel imports.

The European Green Deal aims to decarbonise EU energy systems. It is a critical part of the 2030 climate objectives and the goal of achieving carbon neutrality by 2050. By 2030, at least 32 % of all energy in the EU must be renewable.

In the transition towards renewable energy, the EU is aiming to make sure that energy remains affordable for all citizens.

To achieve the climate objectives, the EU also invests in modernising cross-border energy infrastructure. New rules adopted by the Council in May 2022 aim to modernise, decarbonise and interconnect EU countries’ cross-border energy infrastructures, to help the EU achieve its 2050 climate neutrality objectives.

Parliament also supported the inclusion of projects to help EU countries move away from solid fossil fuels. The eligible projects will receive EU financial assistance until December 2027.

Improving energy efficiency

To increase savings and drive down energy prices for consumers in the long term, the EU has also taken action to improve energy efficiency. In March 2023, the European Parliament and the Council agreed on new rules to boost energy savings, requiring EU countries to reduce energy consumption by at least 11.7 % by 2030. The target should be achieved through measures at local, regional and national levels sectors such as public administration, buildings, businesses or data centres.

The EU also funds action to improve energy efficiency through the European Regional Development Fund. The money in this fund is given to EU countries, who need to allocate at least 30 % to measures reducing greenhouse gas emissions (for instance improving energy efficiency, or building smart electrical grids).

Further reading

• Social Climate Fund, European Parliamentary Research Service, At a Glance 2023
• Review of the EU ETS: Fit for 55, At a Glance 2023.
• Question Time : How to ensure energy security in the EU in 2023, At a Glance 2023
• Revising the Energy Efficiency Directive: Fit for 55 package, European Parliamentary Research Service, Briefing 2022.
• Preparing for ‘RepowerEU’: Action for more secure, more affordable and cleaner energy, European Parliamentary Research Service, At a Glance 2022.
• Energy saving and demand reduction, European Parliamentary Research Service, Briefing 2022.
• Emergency intervention to address high energy prices in the EU, European Parliamentary Research Service, Briefing 2022.

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