Electricity prices in European Union countries have hit record highs since Friday, as Russia’s invasion of Ukraine causes economic pain around the world.
The year-ago contract for German electricity reached 995 euros ($995) per megawatt hour. At the same time, electricity in France also exceeded 1,100 euros. This price is ten times higher than last year in both countries.
In Britain, the price cap for electricity and gas will almost double from October 1 to an average of £3,549 ($4,197) a year, energy regulator Ofgem said.
Ovkem blamed global wholesale gas prices on the rise due to Covid restrictions and sanctions against Russia.
The Czech Republic, which holds the EU’s rotating presidency, announced that it would announce the date of the EU energy crisis summit as soon as possible.
Energy prices in Europe rose as Russia cut natural gas supplies to the continent amid fears of severe winter power cuts amid tensions between Moscow and the West over war.
A fifth of European electricity is produced by gas-fired power plants. So a drop in supply will inevitably lead to higher prices.
France contributed to rising electricity prices as nuclear reactors shut down due to corrosion problems. Only 24 of the 56 reactors operated by energy company EDF EDF were operational on Thursday. Traditionally an exporter of electricity, France is now an importer.
Winter is said to be a tough time for all countries in Europe.
Germany announced on Wednesday that the temperature of public administration offices will be lowered to 19 degrees Celsius (66 degrees Fahrenheit) this winter. At the same time the hot water has been stopped.
A ban on heating private swimming pools also comes into effect from September.
Finland encourages its citizens to lower their thermostats, shower less time and spend less time in saunas. It is a national heritage.
Industries are also affected by rising energy prices.
Poland, Italy, Hungary and Norway announced this week that factories that produce ammonia, the raw material for composting, will shut down their operations.
HSBC Bank warned in a note that a “recession is inevitable” in the euro zone as the economy contracts in the fourth quarter and the first three months of 2023.