The European Union is at a critical juncture regarding competitiveness, decarbonisation, and security, necessitating urgent action to address high energy costs affecting citizens and businesses. The Commission is introducing an Action Plan with short-term measures to lower energy prices, complete the Energy Union, attract investments, and prepare for potential energy crises.
This Plan aims to alleviate household energy bills and support industries facing high production costs, with projected savings of €45 billion by 2025, increasing to €130 billion by 2030 and €260 billion by 2040. It prioritises renewable energy benefits and addresses structural challenges such as reliance on imported fossil fuels and incomplete electricity system integration.
“We’re driving energy prices down and competitiveness up. We have already significantly reduced energy prices in Europe by doubling down on renewables. Now, we are going a step further with the Affordable Energy Action Plan as part of our Clean Industrial Deal. With it, we will achieve more predictable prices, stronger connections across Europe, and increased energy offtake. We will systematically remove remaining obstacles so that we can build a true Energy Union,” Commission President Ursula von der Leyen said.
The Plan builds on reforms like the Electricity Market Design, the REPowerEU Plan, and the Fit for 55 package. It will also tackle all components of energy bills—network costs, taxes, and supply costs—encouraging Member States to lower electricity taxes and simplify supplier switching for consumers.
To improve efficiency and affordability, the Commission will promote long-term supply contracts and propose methodologies to reduce network charges. Additionally, an EU guarantee scheme will support investments in energy efficiency, potentially yielding annual savings of up to €162 billion by 2030.
To address high gas prices affecting European competitiveness, the Commission will enhance scrutiny of gas markets and engage with LNG suppliers for cost-effective imports. The goal is to create well-functioning, decarbonised energy markets that safeguard against price volatility.
“Today’s challenges demand bold and ambitious actions to both reduce energy prices and safeguard our security. The answer to these challenges lies in a cleaner, cheaper, more efficient and connected Energy Union. This is why we will not step back on the green transition. We will step forward with determination and urgency,” Dan Jørgensen, Commissioner for Energy and Housing, said.
The Commission will also update the EU energy security framework to tackle emerging threats and guide Member States on incentivising consumers to reduce peak-time energy consumption, helping stabilise energy bills.
