EU warns of energy price impact on transition

Commission urges against knee-jerk policy reactions as record energy prices make transition more abrupt and difficult

Record high energy prices in Europe are making the green transition “more abrupt and difficult” and policymakers should be prepared for a scenario in which prices “get out of hand”, the European Commission says in an end of year address. Natural gas prices in northwest Europe have surged in recent months and hit record levels in December, drawing on concerns about storage levels and the outlook for flows from key supplier Russian amid tensions over gas transit country Ukraine. More expensive gas has led to increased use of coal-fired power plants, even with surging carbon emissions prices. High energy prices are also feeding into inflationary pressures which threaten to slow the progress of