According to the consumer prices index, energy costs have risen by 15 per over the past year in the EU, as Brussels continues to push its plans to decarbonise Europe's economy by the year 2050.
Toby Couture, director at consultancy at the Berlin-based renewable energy consulting firm E3 Analytics waned that the green transition could see political unrest across the bloc.
“As we start phasing out coal and nuclear capacity that's been in the system for decades, there's a risk that prices will have to rise further,” he told the Financial Times.
“If it starts jeopardizing power reliability and significantly increasing energy prices that people pay, it could lead to significant political pushback.”
The problem of rising energy prices has so far impacted Spain the hardest, with record prices being witnessed over the Summer months.
Earlier this month, the electricity market operator for the Iberian Peninsula, OMIE warned that consumers in Spain and Portugal will see an average price of 140 euros ($165/GBP119) for a megawatt-hour of electricity.
Speaking at Ecofin debate on Saturday, Spain's deputy prime minister for the economy, Nadia Calvino said that the EU needs to be “mindful” of the impact of its green agenda on energy prices.
She said the rising cost “is obviously creating unrest in our populations and pressing the governments to take measures with a view to dampening or minimising the negative impact on household incomes and on the competitiveness of companies.”
Spain's socialist government has removed the Value Added Tax on energy, however, the cuts have not seen a meaningful reduction in prices.
Angel Talavera, the head of European economics at Oxford Economics predicted that the soaring costs in Spain will soon be seen throughout the EU.
“In Spain, people are feeling the pinch in their personal finances but this is not a Spanish problem; it is a European if not a world problem,” Talavera said.
“The issue is that, because of the different way the Spanish market works, much of the world has not noticed it yet, but sooner or later a similar trend will happen in other countries.”
European Parliament Votes to Make EU Climate Neutral by 2050 https://t.co/frIO7ItyZC
— Breitbart London (@BreitbartLondon) June 27, 2021
Poland is facing a possibility of energy costs surging by 40 per cent in 2022 after the price of emitting carbon dioxide already nearly doubled this year.
In response to the spiralling costs, the Polish government has called on the European Union to publish energy invoices to detail the costs of the bloc's climate change policies.
Polish Prime Minister Mateusz Morawiecki said that his country will need to invest 350 billion euros ($415bn/GBP299bn), representing approximately two-thirds of the country's GDP, in order to reach the EU's target of net zero by 2050.
Morawiecki put the blame for rising costs directly at Brussels doorstep last week, saying: “We have here the very expensive climate policy of the European Union.”
“I am convinced that citizens have the right to know that the cost of the European Union's policy is high, of this climate policy,” the Polish leader added.
Not Enough: Yellow Vests to Reject Temporary Suspension of Fuel Tax Rises in France https://t.co/f7f8gwN9Fa
— Breitbart London (@BreitbartLondon) December 4, 2018
French economist Jean Pisani-Ferry raised the spectre of a Europe-wide Yellow Vest (Gilets Jaunes) movement, the populist uprising in France following increases in energy prices.
Pisani-Ferry wrote last month that governments will most likely need to go into debt and to enact socialist redistribution policies, giving the money raised through carbon taxes to the working and lower classes as carbon taxations is inherently “regressive and often affects residents of some areas disproportionally.”
“This is because relatively low income and a carbon-intensive lifestyle make the suburban middle class vulnerable to a rise in the price of carbon; in contrast, affluent residents of metropolitan centres are largely spared.
“This reality (and the corresponding discontent, vividly illustrated by the French Yellow Vests movement) has led governments to reconsider plans for carbon taxation.
“Whereas it was viewed a few years ago as a potential source of revenue or an opportunity to substitute for other taxes (according to the “double dividend” hypothesis), there is growing recognition that revenue from carbon taxation or the auctioning of tradable permits must largely be redistributed in order to neutralize their income effects, at least for the bottom half of the income distribution.”
WATCH: 'Revolution or Ruin' – Extinction Rebellion Activist Says Only Socialism Can Stop Climate Change https://t.co/iCC0O6aMNG
— Breitbart London (@BreitbartLondon) September 5, 2021
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