Meloni tells Senate Europe faces war, energy pressure and security threats

Italian Prime Minister Giorgia Meloni addressed the Senate ahead of the European Council meeting on 15-16 October, setting out Italy's position on competitiveness, energy policy, Ukraine, and wider European security concerns. She said Europe is being forced to make increasingly numerous and complex choices to protect its competitiveness, security and global influence.

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In her account, the war in Ukraine is continuing, the Middle East remains unstable, and both developments are affecting Europe beyond their immediate regions. Meloni said global economic competition is becoming more aggressive.

She added that geopolitical tensions are affecting supply chains, fuel prices, the cost of living and the ability of European companies to compete. She also listed hybrid threats, migratory pressures and growing instability as factors increasing the need to strengthen Europe's security and defence.

She framed these pressures as issues that are already testing Italy's ability to safeguard prosperity and security. Meloni said the Italian government has chosen to remain active on the international stage with continuity and a clear position.

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She said this is necessary because defending the national interest requires Italy to help shape decisions rather than simply absorb their consequences. On the European Council agenda, she said the first issue is competitiveness.

She said leaders will review the implementation of the "One Europe, One Market" agenda and progress on deepening the single market, simplifying rules, reducing administrative burdens, and speeding up planning and authorisation procedures. She said Italy has long supported those goals, but argued that the most urgent competitiveness issue is energy costs.

In her view, European companies cannot be expected to compete with global rivals while paying structurally higher energy prices than those rivals. Meloni said the environmental transition cannot come at the expense of Europe's industrial base.

She said decarbonisation cannot mean deindustrialisation, especially in the current geopolitical context. She said tensions along major trade routes and supply chains are affecting the security and prices of energy and fuel.

According to her remarks, higher transport and insurance costs are being passed on to energy bills, household shopping bills and business accounts. Meloni said no country can respond effectively alone and called for a coordinated and rapid response.

She said Italy worked to reach an agreement within the G7 to release a significant quantity of fuel onto the markets, including to prevent the risk of a halt to US exports, which she said would have had a severe impact on European economies. She said Italy and others must also look at what can be done inside Europe, beginning with rules that were designed in a different context but now worsen present crises.

She said European companies face increasingly aggressive global competition and that every additional cost imposed by Europe gives competitors an advantage. Meloni said Italy recently organised another discussion with heads of state and government focused on competitiveness around three priorities: energy, simplification and international trade.

She said that after this coordination, together with the German Chancellor and the Belgian Prime Minister, she sent three proposals to Brussels to facilitate and free up investments. Those proposals, as she described them, concerned fast-track procedures for strategic projects, a stronger brake on excessive bureaucracy, and a drastic reduction in reporting obligations, especially for small and medium-sized enterprises.

She said Italy also worked with the Czech Republic on proposals to reduce energy costs, some of them temporary. Meloni then turned to the EU Emissions Trading System.

She said a polluting company in Europe must buy an allowance for every tonne of CO2 it emits, and that these allowances are bought on the market, allowing the market to set the price. She said this dynamic does not have much to do with environmental protection.

In her account, higher ETS prices raise production costs for steelworks, paper mills, cement works and ceramics factories, and those costs are eventually transferred to consumers. Meloni said Italy has put forward proposals to correct the ETS so CO2 prices reflect the real economy rather than finance.

She also said Italy asked for a further postponement of ETS2, which she said would otherwise begin passing new costs onto households and businesses in 2028. She said electricity pricing is also distorted by the marginal price mechanism, under which the entire electricity price is set by the last and most expensive plant called on to produce power, often a gas-fired plant paying ETS allowances.

She said that cost is then passed on to all electricity, including renewable power. Meloni said this problem affects Italy in particular because its energy mix still has a significant gas component.

She said the government is addressing this by expanding renewables and reopening the path toward next-generation nuclear power, but that such investments take time and immediate solutions are needed. She said the March European Council included in its conclusions the possibility of temporary and targeted national measures to reduce power generation cost components.

On that basis, she said the Commission committed to work on Italy's "Energy Bill Decree." According to Meloni, those technical talks have been intense and constructive and are moving toward a solution compatible with EU rules. She said the goal is to make the measure operational so that gas-driven power generation has less impact on the overall price of electricity.

She said Italy is seeking practical results rather than symbolic language in summit conclusions, specifically lower energy bills for families and lower costs for companies. She also said there are developments concerning the EU Methane Regulation, under which new requirements for importers could restrict supply and increase prices.

Meloni said Italy asked for a temporary suspension of some obligations. She said the European Commission has now announced its intention to postpone the regulation's entry into force by one year, which she called excellent news.

She presented these cases as examples of a principle Italy has defended since day one: if a rule has unexpected consequences or worsens a crisis, it should be corrected. She said the government is not defending rules against reality, but citizens against rules that are wrong.

Meloni said Italy has already achieved such outcomes before, citing the National Escape Clause. She said Italy was the first to call for flexibility allowed for defence and security to be applied to the energy crisis, and that the idea later became available to all member states.

She said she hopes the same will happen with new proposals on fiscal rules. She said she wrote to President Ursula von der Leyen to request that the energy and inflation shock be taken into account when calculating spending permitted under EU rules.

She also asked for member states to be able to use at least part of the additional VAT revenues generated by price rises to fund temporary and targeted support for households and businesses. She said it would be difficult to explain to citizens why those extra revenues cannot be used to respond to the shock that produced them.

Meloni described these as common-sense proposals and said a compromise will be difficult but that Italy will keep raising the issue. She then addressed critical raw materials, saying lithium, cobalt, graphite and rare earths are needed for the energy transition, the digital transition and the defence industry.

She said Europe imports almost all of these materials, often from just one country, and warned that the continent risks replacing one dependency with another if the issue is not addressed. She said Italy has offered to host one of Europe's first strategic storage sites for these materials in Porto Marghera, which she said could become a European pilot project.

Turning to Ukraine, Meloni said President Volodymyr Zelensky would also take part in the start of the European Council meeting. She said Russia has launched a new autumn campaign against Ukraine after failing to advance on the front line.

She said Moscow is now targeting civilians more severely, citing power plants, apartment blocks, hospitals and buses carrying people to work. She referred specifically to what she called the horrific attack in Kramatorsk.

Meloni said Russia is trying to make the Ukrainian people surrender through terror, cold and darkness because it has not succeeded on the battlefield. She said the facts contradict Kremlin propaganda and the arguments of those who repeat it in Italy.

She said Moscow has gained very little ground since the beginning of the year and lost significant territory in September. In her view, this stalemate was created by Ukrainian courage and Western support, including Italy's.

Meloni said she believes the stalemate is the only effective way to bring Russia to serious negotiations. She acknowledged debate in parliament and political groups, but said supporting Ukraine is not an alternative to peace; it is what makes peace possible.

She said that if the aggressor can expect the adversary to surrender, there is no reason to negotiate. She added that surrender is not peace but conquest, and said that if Ukraine stopped defending itself, Europe would be discussing occupation and the return of Soviet-style imperialism.

Meloni said she does not miss the Russian tanks that crushed the uprisings in Prague and Budapest, nor the Berlin Wall. She said no one will convince her that surrender by those defending their freedom can be called peace.

She said the government's position remains unchanged: support for Kyiv, with particular attention to the civilian population; pressure on Moscow; and Euro-Atlantic unity. She also said Italy must consider President Donald Trump's announcement on Russian diesel, which she called very risky.

Meloni said the rise in fuel prices is primarily due to the war in Iran, not the conflict in Ukraine. She said the risks of the decision include legitimising Moscow while its bombs continue to fall on Ukrainian cities, giving Russia new revenues to fund the war, and weakening the sanctions mechanism.

She said those risks contradict the actions taken so far by Western states, including the United States, to push Vladimir Putin toward negotiations. She said a ceasefire on energy plants is different and that Italy supports it.

Meloni thanked President Zelensky for immediately declaring Ukraine's full willingness for such a ceasefire. She said Italy now expects Russia to do the same and to stop attacking Ukrainian power stations and energy plants.

She closed by saying that at such a complex time, one thing remains within Europe's control: ensuring that Europe does not stand by and watch.

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