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Factbox-What is in the EU's Affordable Energy Action Plan?
Published by Global Banking and Finance Review
Posted on February 26, 2025
2 min readLast updated: January 25, 2026
Global Banking and Finance Review
Company
Published by Global Banking and Finance Review
Posted on February 26, 2025
2 min readLast updated: January 25, 2026
The EU's Affordable Energy Action Plan aims to cut electricity costs, promote clean energy, and diversify suppliers, enhancing global competitiveness.
BRUSSELS (Reuters) - The European Commission announced an Affordable Energy Action Plan on Wednesday to lower electricity bills, help roll out clean energy sources and diversify suppliers.
The plan is part of its Clean Industrial Deal that aims to boost clean tech and help energy-intensive industries stay competitive globally.
Here are some of the main elements:
ELECTRICITY
* Design new tariffs for power grid charges to allow users to use power at different times and shift access to the cheapest source (second quarter 2025)
* Push member states to finish revision of Energy Taxation Directive and cut taxes
* Decouple retail power prices and volatile natural gas with guarantees from the European Investment Bank for long-term renewable power contracts
* Adopt new rules to develop European forward markets and increase hedging options, which are lacking for renewable energy
* Push countries to adapt and speed up permitting regimes by mid-2025 for renewable power projects that can take a decade to complete
* The Commission will propose a Grid Package in 2026
GAS
* Propose to aggregate liquefied natural gas demand for EU companies to secure long-term deals, potentially by investing in infrastructure abroad
* Gas Market Task Force to ensure well-functioning market to conclude by the fourth quarter 2025
* Crack down on manipulation with cooperation on enforcement and data sharing between EU energy agency ACER and EU financial regulator ESMA
ENERGY UNION
* Electrification Action Plan in the first quarter, 2026, to help decarbonise industry, transport and heating
* Roadmap to digitise and use AI in the energy sector
* Tackle investment gap with incentives for private capital with a Clean Energy Investment Strategy
* Boost innovation through various action plans and a study of nuclear financing needs to potentially build out small modular reactors
(Reporting by Julia Payne; Editing by Rod Nickel)
The plan aims to lower electricity bills, promote clean energy sources, and diversify suppliers as part of the Clean Industrial Deal.
Key elements include designing new tariffs for power grid charges, revising the Energy Taxation Directive, and decoupling retail power prices from volatile natural gas.
The plan proposes to aggregate liquefied natural gas demand for EU companies and ensure a well-functioning gas market through a dedicated task force.
The Energy Union strategy includes an Electrification Action Plan, a roadmap for digitization and AI in the energy sector, and incentives for private capital.
The Commission plans to propose a Grid Package in 2026 to enhance the development of European forward markets and increase hedging options.
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