Top think tanks in Europe are trying to calculate how much the global energy price increase and supply crisis, which started in 2021 and deepened with Russia’s invasion of Ukraine this year, has cost European capitals so far.

An estimated 500 billion euros ($478 billion) has been mobilized to protect households and businesses, homes and factories from the expensive energy surge. Europe's prominent economists and experts, meanwhile, say the story would be completely different today if the 500 billion euros Europe had to allocate to ease high utility bills last year had been used for Europe's "green energy transformation" and energy resource diversification since Russia's annexation of Crimea in 2014. They also note that if that were the case, today, we would be talking about a Europe that removed the energy crisis from its agenda.

The data gathered by the Brussels-based think tank Bruegel shows how much nations have allocated so far to support households and businesses while balancing the rise in energy prices and keeping the market at a certain level, as seen below:

The United Kingdom 178.6 billion euros, Germany 100.2 billion euros, Italy 59.2 billion euros, France 53.6 billion euros, Spain 35.5 billion euros, Poland 10.6 billion euros, Austria 8.9 billion euros, Romania 6.9 billion euros, Greece and Denmark 6.8 billion euros, the Netherlands 6.2 billion euros, Belgium 4.1 billion euros, the Czech Republic 2.9 billion euros, Croatia 2.4 billion euros, Bulgaria 1.8 billion euros, Sweden 1.6 billion euros, Lithuania, Luxembourg and Latvia 1.1 billion euros, Slovakia 1 billion euros, Ireland 700 million euros, Finland 500 million euros, Slovenia 400 million euros, Malta and Estonia 200 million euros.

EU’s two moves

The European Commission has made two moves, the first of which came last week. Within the scope of the contingency plan for the energy crisis; it aims to limit the revenues of low-cost electricity producers, receive excessive contributions from fossil fuel companies, reduce electricity demand by curbing thermostats in buildings and provide liquidity to energy companies that reflects in energy prices to their customers with a limited margin, making losses between the price they buy and the price they sell.

As a matter of fact, the 140 billion euros from the emergency aid plan will also be made available to households and businesses to balance the increase in energy costs. However, the increase in energy costs is so drastic that European companies working in sectors that need to use a high amount of energy in production such as iron and steel, fertilizer, aluminum, machinery and construction materials are constantly making statements that they will take a break for a certain period of time or indefinitely.

Hence, in order to prevent a heavy disruption in industrial production in Europe and not leave households without natural gas and electricity, the energy ministers of EU member states will meet in Brussels next Friday. They will hold an extraordinary meeting in Brussels to discuss the measures to be taken against the increase in electricity and natural gas prices and the topics in the current package of measures.

Another move by the European Commission on Sept. 19 was to lift the ban on the import and transportation of certain types of fertilizers, animal feed, wood products, cement and coal as well as other solid fossil fuel products from Russia. The move was made due to the significant threat to agricultural production the world still faces if the export of fertilizers from Russia and Ukraine, as well as the grain corridor, does not start.

On Friday, United Nations Secretary-General Antonio Guterres announced that if the fertilizer market fails to stabilize, the world may be left without agricultural products next year. Guterres had also urged countries to urgently lift sanctions on Russian manure and provide assistance to farmers worldwide to access cheap fertilizer so they can plant crops as soon as possible.

The support of the European Commission is very important in this sense. Especially at a time when gas prices are so high across Europe and many fertilizer factories have decided to suspend production one after another.