As Wall Street banks are drafting contingency plans to move out of Germany in case of a blackout, the EU Commission whistles by the graveyard. Today the Commission presented a list of five proposals for the extraordinary energy summit that will take place tomorrow in Prague.
EC President Ursula von der Leyen has presented a “non-paper,” i.e., no official document, in order not to make a brutta figura the way she did last time, when Commission proposals were rejected by some countries.
As expected, the proposals aim to save not the households, not producers, but the energy market and its derivatives bubble. In fact, the proposals include liquidity for energy companies, courtesy of European taxpayers. Another proposal is a mandatory target to reduce electricity consumption during peak hours. Peak demand is sustained by gas, which is expensive. A way to implement this is auctions, where companies would say how much money they are willing to accept in compensation for cuts in consumption. Von der Leyen said that she will “work in close contact with member states on this.”
Third, is a revenue cap for utilities that produce at low-cost. Fourth, the same goes for companies in the fossil fuels branch. Last but not least, a price cap on Russian gas.
In the past days Bloomberg had revealed that the Czech government, rotating EU Council chairman, will propose to suspend derivative transactions on the TTF gas market in Amsterdam, which will probably be vetoed by the Dutch government.
Meanwhile, the Telegraph reported that JPMorgan Chase is preparing for a blackout in Germany. The bank has drawn up plans to move banking operations from Frankfurt to London and other European countries in the event of a possible blackout, according to the Telegraph. These relocations could take place from any location to any location at any time, the newspaper reports, citing informed circles. Under certain circumstances, the bank would also rely on emergency generators to guarantee office operations for several days in the event of power outages. The shocking report is covered by all media in Germany and it is to be presumed that other banks are making similar preparations.
