In a letter to European Commission (EC) President, Ursula von der Leyen, the European Apparel and Textile Confederation (Euratex), Brussels/Belgium, stated, that any price cap above the level of €80/MWh would not help European Union (EU) industry – the textile sector in particular – to survive the current crisis.
»While the EU Industry is under immense, unprecedented pressure, a price cap at €275/MWh would be meaningless: the European industry will be permanently pushed out on the market.«
Indeed, as early as July 2021, the wholesale gas price in the EU was below €30/MWh. Now, EU industry is facing gas and energy prices that have exceeded any coping capacity: from the record-high €320/MWh in August 2022, the price has reached to €127/MWh today (November 2022). Still, it is more than 300% than the business-as-usual prices.
According to Euratex, the very existence of European industry is at stake and with it the European sustainability agenda – and Europe’s capacity to implement it. Furthermore, Europe will lose its strategic autonomy, which guarantees essential goods and services are made available on the European Internal Market. If the EU continues on this path, it will soon become totally dependent on foreign imports with no leverage to implement its sustainability agenda, let alone lead the transition to a circular economy on the international stage.
At present, EU industry is facing dire international competition with the industry in China, India and the USA working at energy prices of around US$10/MWh. In addition, these competitors are benefitting of sky-high subsidies from their own governments: the rollout of the US $369 billion industrial subsidy scheme is just the latest example.