By Kate Abnett
BRUSSELS (Reuters) - Germany, Denmark and seven other EU countries have opposed overhauling the bloc's electricity market in response to high energy prices, a move they said could increase the cost of adding renewable energy to the system in the long run, ahead of a meeting of EU ministers on Thursday.
Energy ministers from the European Union's 27 member countries will meet on Thursday to debate their response to energy prices that surged to record levels in autumn as tight gas supplies collided with soaring demand in economies recovering from the COVID-19 pandemic.
In a joint statement, the nine countries urged the EU to stick with its current energy market design. Price caps or different systems of setting national power prices could discourage electricity trade between EU countries and undermine incentives to add low-cost renewable energy to the system in the long run, they said.
"We cannot support any measure that would represent a departure from the competitive principles of our electricity and gas market design," the countries said.
"Deviating from these principles would undermine the cost-effective decarbonisation of our energy system, jeopardise affordability and risk security of supply."
The statement was signed by Austria, Denmark, Estonia, Finland, Germany, Ireland, Luxembourg, Latvia and the Netherlands.
EU countries have splintered over how to respond to high prices, with Spain and France among those seeking an overhaul of EU energy regulations. Madrid has led calls for EU countries to buy gas jointly to form strategic reserves.
Other governments are wary of long-lasting regulatory reforms to respond to what they say could be short-term price spikes. Many EU countries have already introduced temporary measures, such as subsidies for households and tax breaks, to lower consumer bills.
While gas prices have retreated from the record highs recorded in early October, they are still relatively high in countries including the Netherlands, where prices began climbing again in recent weeks amid forecasts of a cold weather.
(This story refiles to fix capital letter in paragraph 2)
(Reporting by Kate Abnett; editing by Philip Blenkinsop and David Evans)