U.S. Mission to the EU

Ambassador Andrew Puzder Verified account @USAmbEU · Nov 4

With a hard winter approaching and energy prices still painfully high – as even Energy Commissioner Jørgensen has warned—the Commission’s handling of the EU Methane Regulation (#EUMR) has failed to deliver the relief the moment requires.

In June, the Commission acknowledged the threat the EUMR posed by announcing a three-year penalty holiday intended to prevent the EUMR from tightening supply and pushing prices higher once it took effect. But it has not worked. A temporary pause on fines does not remove the legal requirement for companies to comply with the legislation – and no publicly owned and traded company will knowingly break EU law even if there is no fear of a penalty.  Absent a proper delay in the regulation’s implementation – so companies are not in breach of EU law – the risk that the EUMR will drive tighter supply and higher prices remains.

So, in September, the Commission proposed a one-year implementation delay – again acknowledging the EUMR’s threat to energy supplies and pricing. But one year is too short to fix the problem. One extra year will not give companies and regulators enough time to build verification systems, bring suppliers into compliance, or lock in multi-year contracts at competitive prices. The EUMR still discourages energy imports and the longer-term deals that stabilize supply. This will keep the market tighter – and more expensive – than necessary heading into this winter and beyond.

Industry has been consistent: a three-year delay is required to put robust compliance and verification systems in place, achieve supplier compliance, and ensure reliable volumes.  Industry is not asking to repeal the regulation. It is just seeking a three-year delay which is long enough to address the EUMR’s regulatory issues. Do not punish European energy suppliers and consumers because the original regulation was poorly written.

The European Parliament recognized this reality by backing a three-year postponement of key importer obligations. If the Commission is willing to waive EUMR penalties for three years, why not also delay implementation for three years and actually solve the problem as Parliament proposes? The solution is simple – the penalty delay and implementation delay should be the same length – three years. We hope the Council will follow Parliament’s example.

Europe needs practical regulatory timelines that protect both energy supply and affordability. Half-measures that leave Europe’s households and industries exposed are not a solution.

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