By Julia Payne and Kate Abnett
BRUSSELS (Reuters) – European Union countries failed again to strike a deal on the reform of Europe’s electricity market on Friday, with states still at odds over potential new state aid for power plants, diplomatic sources said.
The 27 EU countries are seeking a joint position on planned reforms to the EU’s power market, but countries including Germany and France have struggled to agree on elements including rules on state aid for power plants.
EU countries’ ambassadors failed to agree to a new compromise proposal on Friday, EU diplomats said Some complained they had not had enough time to analyse the text, which was sent to countries on Thursday evening by Sweden, which holds the EU’s rotating presidency.
Responsibility for sealing a deal will now pass to Spain, which takes on the EU presidency from July until the end of the year.
The planned electricity market reform aims to make Europe’s power prices more stable, and avoid a repeat of last year’s energy crisis when record-high gas prices left consumers with soaring bills.
But the hunt for a deal has been hampered by disagreements over how far countries can subsidise existing plants using new, fixed-price power contracts with the state.
Germany, Austria and Luxembourg have warned this could distort the EU market by giving some states a competitive edge – a concern EU diplomats said centred around the potential use of these subsidies for French nuclear plants.
France, which had supported the subsidy proposal, has said restricting the use of such subsidies risked undermining energy security and efforts to protect consumers from volatile power prices.
The latest compromise proposal, which countries considered but did not back on Friday, would have placed tighter conditions on which power plants could receive the state support.
Brussels is racing to find a deal on the final law – which EU countries must negotiate with the European Parliament – before EU Parliament elections next year.
(Reporting by Julia Payne, Kate Abnett; Editing by Andrew Heavens and Keith Weir)
