The EU executive has pledged to come up with unprecedented measures in the coming days to solve an energy price shock triggered by Russia's war on Ukraine, including a controversial gas price cap that could further anger the Kremlin.

Moscow's invasion has seen the price of natural gas hit record levels, throwing the EU economy into deep uncertainty, with all eyes on whether Russian President Vladimir Putin will cut off the flow entirely.

European energy ministers tasked the European Commission in Brussels to work through the weekend to draw up legal texts that will include emergency funding for consumers sinking under the weight of soaring bills.

The EU will table "unprecedented measures next week for an unprecedented situation", energy commissioner Kadri Simson said, after meeting the ministers.

Ms Simson said compensation for struggling households and businesses would be covered by a levy on non-gas electricity companies, such as nuclear, solar or renewable firms, that are seeing a revenue bonanza on the back of high prices for electric power.

The market price of electricity in Europe is closely linked to the gas price, meaning non-gas utilities are enjoying huge revenues despite far lower costs.

Ms Simson said fossil fuel companies would also be levied on their mega profits from the inflated energy prices.

Minister for the Environment Eamon Ryan

Gas price cap

Despite heated debate among European countries, the EU will also attempt to lower the price on natural gas, possibly through a price cap on Russian imports or through negotiations with other suppliers.

Czech Industry and Trade Minister Jozef Sikela, whose country holds the EU presidency, said there was a "prevailing view" among EU countries that some form of price ceiling was necessary.

But he called for patience "to fine tune where properly...the cap should be implemented", adding that nothing was decided at this stage.

Fears are rife that targeting Russia alone would only further rile Moscow, which has threatened to cut off the supply to Europe entirely if a cap is imposed.

Last week Russia caused a major scare when it halted gas deliveries to Germany via a key pipeline for an indefinite period, a move the Kremlin blamed on Western sanctions.

One leading approach would be for EU countries to jointly negotiate with major suppliers such as Norway, Algeria or the United States in order to squeeze out better terms.

"Countries are calling for new thinking about capping the gas price ... and the question arises in different technical terms," said French energy transition minister Agnes Pannier-Runacher.

Despite the differences, she added, "what is interesting is that there is a common desire to move forward on this subject".

Binding measures?

One proposal that has broad backing is an idea to rescue electricity companies that are struggling to hedge their spending on energy markets that have been extremely volatile.

This would be done by relaxing EU rules on state rescues of companies that are suddenly facing more onerous terms for cash as fears of a crisis spread.

The commission will also design a mechanism to cut back on energy demand, with mandatory cuts imposed if voluntary limits at peak hours fail.

"Member states are usually very reluctant to support binding measures, but this is exactly what the Commission is considering," Ms Simson said.

The commission, which draws up laws that are then ratified by member states and the European Parliament, will likely make its proposals as early as Tuesday.

"We will have a busy weekend and first days of next week before the final product...will be really ready," Ms Simson said.

'We can do it within weeks' - Ryan

Speaking on RTÉ's Drivetime, Minister for Transport, Climate and Environment Eamon Ryan said the measures include placing a mandatory reduction on electricity use during peak times, supporting energy companies to give them liquidity and looking at ways to put at a cap on international trade on gas from Russia and elsewhere coming into the EU.

"In the electricity markets we would take some of the excess revenue that is going to the generators and recycle it back to householders," he said.

"Fossil fuel companies are making a fortune because the way the war has put up the prices," Mr Ryan said, adding that some of those profits will also be "recycled".

Mr Ryan said that some of the proposed measures will be put in place before Christmas.

"We can do it within weeks rather than months," he said.

"We were looking at this ourselves in terms of windfall taxes. This delivers it by a European Union means.

" Mr Putin is looking to divide Europe and that didn’t happen today.

"We will do everything we can to reduce the demand for electricity particularly at peak times, particularly looking at large energy users to see how can they reduce their use of energy at that time.

"I don’t believe it will be done on a mandatory basis. What our own regulator suggested is that you put in market signals to help make it happen.

"Market signals are higher prices at a certain time and lower prices at another time.

"What we’re agreeing on today is in line with what the Irish government has been suggesting."

He also said that high energy prices are likely to be a factor for approximately two years.

"Europe is looking at other energy sources so that we don’t become reliant on that Russian gas," Mr Ryan said.

"All the market analysis is that this is likely to be a difficult period for about two years.

"For the next year and likely into the following year, energy prices are going to stay high."