The European Commission is doubling down on efforts to lower energy prices and bring quick relief to industrial and household consumers, according to the Commission. Energy prices in Europe remain too high compared to competitors, risking hindering industrial competitiveness, the economy, and citizens' quality of life, multiple reports indicate. The Commission is setting out seven specific actions to be implemented with Member States to urgently bring energy prices down, the Commission said.
Energy prices in Europe are still high, with household electricity prices 36% above the 2014–2020 average, according to the European Commission. EU Energy Commissioner Dan Jørgensen stated that 42 million Europeans cannot properly heat their homes every winter, and millions more cannot afford air conditioning in summer. European industries pay two to three times more for their energy than in the US and China, Jørgensen added.
The ongoing unrest in the Middle East highlights Europe's vulnerability due to dependence on imported fossil fuels, multiple reports indicate. The conflict in the Middle East has caused oil prices to rise, putting a burden on the economy, according to multiple reports. The EU paid an estimated €375 billion for imported fossil fuels in 2024, the European Commission reported.
The EU Commission presented four interconnected energy proposals on Tuesday: a consumer energy package, a strategy for clean energy investment, a strategy for small-scale nuclear reactors, and a package on financing energy efficiency, according to multiple reports. The proposals are not direct legislative proposals but recommendations and strategies intended to guide how EU countries and the financial sector act in the coming years, multiple reports indicate.
EU leaders have identified three key targets for quick relief on energy prices: national electricity taxes, network charges, and carbon costs for electricity generation. National electricity taxes can reach as high as 22%, representing around 10% of energy bills in several EU countries. Network charges account for an average of 18% of the bill for industrial consumers. Carbon costs for electricity generation account for around 11% of the electricity bill for industrial users.
The European Commission plans to protect heavy industry from rising electricity prices by considering changes to national taxes, network charges, and carbon costs. Industrial electricity prices in the EU were more than twice as high as those in the US and China during the first half of 2025, a European Commission document shows. Gas prices in the EU reached four times those in the US.
The Commission recommends EU countries lower taxes and fees on electricity, which could save households an average of €200 per year if fully implemented, according to multiple reports. Making it easier for consumers to switch electricity suppliers could save an additional average of €152 per year, multiple reports indicate. Flexible electricity contracts and smart appliances could lower electricity bills by up to 40% in the best case, the European Commission said.
Investments needed for the energy transition are estimated at €660 billion per year until 2030, compared to the €240–250 billion actually invested today, multiple reports indicate. The Council is pushing for faster development of energy infrastructure, especially grid infrastructure, according to multiple reports. Permitting remains too slow and hampers renewables, storage, and grids development, research indicates.
Institutional investors such as pension funds and insurance companies control an estimated €12 trillion in Europe, multiple reports indicate. The European Investment Bank (EIB) commits to contributing more than €75 billion in financing over the next three years as part of the clean investment strategy, according to multiple reports. Existing EU rules allow governments to provide financial assistance to companies facing high electricity prices, covering up to half of wholesale electricity costs for energy-intensive industries under certain conditions.
Recent reforms to the EU electricity market in 2024 introduced Contracts for Difference (CfD) and Power Purchase Agreements (PPA) to stabilise prices. Member States should encourage industrial players to engage with financial actors like the EIB on opportunities such as Power Purchase Agreements, the European Commission said. The Commission and EIB have launched a €500 million pilot programme to support corporate power purchase agreements (PPAs), according to multiple reports.
EU leaders are calling on the European Commission to revise electricity prices for households and industrial sites and urgently present concrete proposals to bring down power costs in the short term, according to multiple reports. Germany, Italy, Spain, Portugal, and Austria have asked the EU for energy companies to help alleviate the burden on consumers and taxpayers using extra profits from rising fuel prices, multiple reports indicate. The five Ministers of Economy and Finance wrote a letter to EU Climate Commissioner Wopke Hoekstra, calling for an EU-wide contributory instrument to tax extra profits of energy companies, according to multiple reports.
The EU proposal aims to connect Europe's electricity grid, according to official sources. According to the Commission's proposal, a part of the so-called congestion revenues would be shared, the European Commission said. Sweden will not suffer economically from the EU proposal to connect Europe's electricity grid, according to Sweden's official position.
EU leaders have asked the Commission to deliver a review of the EU’s Emissions Trading System (ETS) by July 2026, according to multiple reports. The Council wants the EU executive to review the bloc's carbon market to reduce volatility in the carbon price and limit its impact on electricity bills, multiple reports indicate. EU leaders are considering changes to be discussed at the European Council meeting on 19 and 20 March, research indicates.
Energy-intensive industries have been calling on the EU to address rising electricity and gas prices even before prices soared further after US and Israel strikes on Iran, research indicates. The idea of suspending the EU's Stability Pact to give governments more leeway to deal with the crisis was rejected by the European Commission, according to multiple reports.
The EU installed a record 89 gigawatts of new renewable capacity last year, saving more than €30 billion in fossil fuel imports, according to EU Energy Commissioner Dan Jørgensen. The Commission encourages Member States to implement the revised Renewable Energy Directive and will propose new measures to accelerate permitting, the European Commission said.
Oil prices surpassed $114 (around €98) per barrel for the first time since 2022 on Monday amid heightened tensions over the Iran war, according to multiple reports. Fuel prices have risen dramatically across Europe due to the war, with Germany, Italy, and Spain among the most affected countries, multiple reports indicate. The Commission urges Member States to make full use of the enhanced State aid framework (CISAF) to support energy-intensive industries, according to the European Commission. The Commission urges Member States to maximize use of EU Cohesion Funds to invest in national grids and storage capacity, the European Commission said. In the EU Commission's proposed network package from December, it includes that the EU should use 25% of the so-called bottleneck fees that member states receive due to price differences between different electricity areas, according to the European Commission.