Spanish Prime Minister Pedro Sanchez on Wednesday claimed his government’s energy policy is most credible in Europe, saying Spain’s ideas are finally being validated at the EU level.
“With all humility … in terms of energy policy, no European government is more credible than the Spanish government right now,” he told lawmakers in a parliamentary debate.
Sanchez said his government has defended the need to reform the EU energy market for years.
Long before the 2022 war in Ukraine, governments in both Madrid and Lisbon had been harsh critics of the EU system of marginal pricing in the energy sector.
Under this system, the final price of electricity is often set by the price of natural gas, making cheaper, clean energy sources more expensive.
This spring, as electricity prices soared, the two nations convinced Brussels to allow for the “Iberian exception,” which enables Portugal and Spain to impose temporary price caps on gas.
On Wednesday, the EU Commission proposed a related measure that would put a temporary revenue cap on ‘inframarginal’ electricity producers that provide cheaper energy to the grid.
In June, Sanchez also announced a windfall tax on energy companies profiting from soaring prices — the same concept proposed by EU chief Ursula von der Leyen.
Spain’s latest political battle with Brussels is convincing the EU to help it build the MidCat pipeline, which would connect Spain to France and the rest of the European energy network. Germany is a crucial backer of the idea.
French authorities, however, have questioned the pipeline’s usefulness and remain unenthusiastic about the project.
The latest comment from the EU was that the pipeline is not a “project of common interest” and that France and Spain would have to agree to the project first.
Yet, despite Sanchez being ahead of the curve on some energy matters in Europe this year, members of Spain’s political opposition continue to criticize his progressive government.
On Wednesday, leader of the far-right party Vox Santiago Abascal slammed Sanchez for the breakdown of relations with Algeria, closing coal plants and blocking domestic energy exploration.
Meanwhile, the conservative Popular Party (PP) argued that the government must reduce taxes on more basic products to help families deal with inflation. In October, Spain already plans to slash VAT on gas bills from 21% to 5%.
“The PP’s electoral program is exactly the same as what big energy companies want,” responded Sanchez.