Home › Archive › In the Media › iDnes | Cap the allowances? Short-term solution. The EU is looking for another way to make energy cheaper

iDnes | Cap the allowances? Short-term solution. The EU is looking for another way to make energy cheaper

The European Union refuses to make energy cheaper by abolishing emission allowances, even though Czech economists and businessmen believe this would bring the greatest relief. Instead, it is coming up with its own plan to lower electricity and gas prices. Filip Křenek, an analyst at the Europeum Institute, commented on the situation for iDnes.

In the Media

28. March 2025

Reducing the energy price debate to the issue of allowances is, at the very least, a tactical mistake. If Czech companies are still thinking mainly in this way, I am afraid that even after twenty years in the EU they have not managed to find their way around the way common European rules are made.

Abolishing or capping the price of emission allowances would have a short-term effect on energy prices in the EU, but it does not solve the structural problems of the energy market. In the long term, such an intervention would weaken the signal for investment in low-carbon energy sources, which could increase dependence on fossil fuels and make the EU more vulnerable to price shocks like the one we experienced in 2022.

Read the full article here.