Greek Prime Minister Kyriakos Mitsotakis has called upon Brussels to urgently address the prolonged crisis that has led to extreme energy price hikes, necessitating immediate political intervention.
According to the Financial Times, in a letter to the European Commission, Mitsotakis noted that electricity prices in August surged from 60 euros per megawatt-hour (MWh) to 130 euros per MWh, urging Commission President Ursula von der Leyen to use her second five-year term to promote ‘more cross-border capacity’ to prevent similar issues in the future.
Mitsotakis also referred to inflationary pressures affecting water prices in Greece which he attributes to electricity costs in Greece, Romania and Hungary due to factors such as warm weather, power generation disruptions, and low rainfall, which left reservoirs feeding hydroelectric plants dry.
Greece had previously warned that Russian strikes on Ukrainian infrastructure would affect electricity prices in Southeast Europe, this summer, emphasizing the EU’s energy market vulnerability. Previously a net exporter of electricity, Ukraine has been forced to import significant amounts from its EU neighbors this year.
“This is another cost that Russia’s devastating war imposes on our economies,” the Greek Prime Minister wrote, while calling for better oversight of the electricity market.
Energy prices have become a key concern for policymakers as they seek ways to improve Europe’s lagging global competitiveness.
Former Italian Prime Minister and European Central Bank President Mario Draghi noted in his report on the eurozone’s competitiveness that European companies face electricity prices at least two to three times higher than their U.S. counterparts.
Commission’s Goals
The Commission has estimated that 584 billion euros in investments in power grids will be required by 2030 if the bloc is to achieve its ambitious climate targets, while simultaneously aiming for EU states to make 15% of their electricity available to neighboring countries.
Mitsotakis also highlighted the issue in a speech last week in Thessaloniki during a press conference, where he emphasized the region’s persistent problems with high electricity prices.
“There is a fundamental distortion in the energy market of Southeast Europe,” he stated. “Something is not working properly. I don’t expect immediate solutions, but at least someone should address this.”
