Medina says that rising energy prices “can’t be solved with taxes.”

Finance Minister Fernando Medina said this Saturday that rising energy prices “cannot be solved with levies” while the European Commission intends to funnel energy windfall to social support.

“The issue of energy prices is not solved through fees,” said Fernando Medina, speaking on the second day of the informal meeting of European Union (EU) finance ministers under the Czech Presidency of the Council in Prague.

A day after EU energy ministers discussed in Brussels the emergency measures to be applied at EU level to mitigate the effects of rising prices in the energy sector, the Portuguese financial watchdog pointed out that “fees are a way to use exceptional revenues “. for a specific public policy goal, [mas] the central question is how “prices” for energy carriers, given the current crisis, exacerbated by the war in Ukraine.

“The central question that is being discussed in these Councils is the problem of how to find a solution, since Europe has decided to prepare and take measures to suspend the supply of gas that comes from Russia, and this whole picture casts doubt on the need to find other suppliers, which has pressure on energy and gas prices, […] and as a result, gas prices are tied to electricity prices in the European space, where there is no such decoupling mechanism, which, after all, we have a difficult situation,” Fernando Medina emphasized.

For the official, “this is the most important area where action must be taken, because, in fact, when these prices are controlled, and the emergency revenues are reduced, the emergency revenues of these companies will decrease.”

In statements to Portuguese journalists, Fernando Medina also said that “the two measures contained in the fund’s proposal, the ministers’ decision to ask the Commission now to develop legislative proposals, are measures that are already being implemented in Portugal.”

“Firstly, the separation of what is the separation of gas in determining the price of electricity” through a temporary Iberian mechanism and, secondly, “the existence of a regulated gas tariff market, that is, the possibility of making a tariff that is in principle protected by contracts” – he concluded.

EU energy ministers held an extraordinary council in Brussels on Friday to discuss possible emergency measures to be applied at the EU level to mitigate the impact of rising prices in the energy sector.

In the end, the European Commission promised “unprecedented measures due to the unprecedented situation” in the EU energy crisis, which will cover “all fronts” and will be presented next week to reduce energy prices.

Portugal, on the other hand, has generally agreed with the emergency measures being discussed in Brussels to lower prices in the energy sector, although it believes that some of them can still be “tweaked,” said Environment and Climate Action Minister Duarte. Cordeiro.

Earlier on Wednesday, the European Commission had already presented some ideas, including a profit cap for cheap electricity companies and a “solidarity contribution” from fossil fuel companies, as well as a price cap. on gas imports via pipeline from Russia to the European Union.

Geopolitical tensions over the war in Ukraine have affected the European energy market as the EU imports 90% of the gas it consumes and Russia accounts for about 45% of those imports at various levels between member states.

In Portugal, Russian gas accounted for less than 10% of total imports in 2021.