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Through the auction, consumers could be paid several times the market price of gas for not consuming gas. That may seem counterintuitive, but it simply reflects the fact that there is an 'externality' when consumers reduce their demand (Photo: Tori Rector, Flickr)

Paying consumers who save most energy could tame gas prices

The saga of capping gas prices is far from over, and the EU is under pressure to balance high energy costs, maintain price signals, and meet its green transition targets — without any negative long-term impact on the energy market design.

The increase in the gas price affects not only gas consumers, but also increases the electricity price, and affects the entire economy.

The European Commission has sought to address the impact on consumers through, among other measures, the appl...

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The views expressed in this opinion piece are the author’s, not those of EUobserver

Author Bio

Dr Bernd Weber is founder and director of EPICO KlimaInnovation, and visiting professor of EU energy policy at the College of Europe. Oscar Arnedillo is managing director at NERA Economic Consulting in Madrid. Sam Williams is EU policy specialist for energy and climate at EPICO KlimaInnovation.

Through the auction, consumers could be paid several times the market price of gas for not consuming gas. That may seem counterintuitive, but it simply reflects the fact that there is an 'externality' when consumers reduce their demand (Photo: Tori Rector, Flickr)

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Author Bio

Dr Bernd Weber is founder and director of EPICO KlimaInnovation, and visiting professor of EU energy policy at the College of Europe. Oscar Arnedillo is managing director at NERA Economic Consulting in Madrid. Sam Williams is EU policy specialist for energy and climate at EPICO KlimaInnovation.

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