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Towards a European Energy Community : A Policy Proposal

www.notre-europe.eu. Towards a European Energy Community : A Policy Proposal. Sami Andoura Leigh Hancher Marc van der Woude. European Parliament – Brussels 07th June 2010. www. notre-europe.eu. www.notre-europe.eu. 15/09/2014. 15/09/2014. Presentation of the Project

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Towards a European Energy Community : A Policy Proposal

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  1. www.notre-europe.eu Towards a European Energy Community: A Policy Proposal Sami Andoura Leigh Hancher Marc van der Woude European Parliament – Brussels 07th June 2010

  2. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Presentation of the Project • Notre Europe published its report “Towards a European Energy Community: A Policy Proposal”, Prefaced by Jacques Delors • Initiated by Jacques Delors, this report is the harvest of the work of the Task Force of high-level European experts established by Notre Europe to study the feasibility of a European Energy Community • The report was elaborated by Marc van der Woude and Leigh Hancher as co-chairs and Sami Andoura as rapporteur • Methodology: What is an energy policy?; Do we have one in Europe today?; If not, how should it look like and how can we achieve it? 2

  3. Introduction (1) • Why a new proposal? • Society is changing in the wake of a new industrial revolution • Drivers behind this change are a series of crises (Environmental/Economic/Political) • What is at stake for Europe? • Question about our collective ambitions • Will Europe be in the driving seat or at the back bench? www.notre-europe.eu www.notre-europe.eu 15/09/2014

  4. Introduction (2) • What is an energy policy ? • Energy is at the basis of all economic activity • Changing concept in time (coal, oil, gas, electricity) • Three objectives: • Accessibility • Sustainability • Reliability www.notre-europe.eu www.notre-europe.eu 15/09/2014

  5. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Do we have a European energy policy ? (1) • Yes, energy-specific Treaties, but: • ECSC: expired in 2002 • Euratom: only nuclear • General Treaties remain general: • EC/EU • Lisbon Treaty 5

  6. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Do we have a European energy policy ? (2) • Increased activity since mid-nineties, essentially dealing with: • Internal market (liberlisation packages) • Environment (ETS, product requirements) 6

  7. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Do we have a European energy policy ? (3) • Picture ? 7

  8. Do we have a Europeanenergypolicy ? (4) • Regression rather than progression? • Historical reasons/Strong internal market focus • Heterogeneity in terms of availability of energy resources for the member states • National sovereignty over the energy mix • International cooperation outside EU structures: security of supply and bilateral deals • Lack of EU foreign policy www.notre-europe.eu www.notre-europe.eu 15/09/2014

  9. www.notre-europe.eu www.notre-europe.eu 15/09/2014 Do we have a European energy policy ? (5) • Have the 3 objectives for EU energy policy been achieved? • Affordable access: Primarily liberalisation issue and viewed as an end in itself • Sustainable development: Not pursued as an energy-specific issue but as an environmental matter only (climate change) • Security of supply: Limited stocking requirements, studies and statements

  10. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Do we have a European energy policy ? (6) • A fragmented energy policy: • In terms of consistency: Energy-specific measures as side issues of other policy measures (internal market rules, environmental policy) • In terms of capability: Slow and complex decision-making process; lack of competence to set the direction of R&D and investments; no clear power of initiative on the external dimension • In terms of credibility: Ambivalent implementation of the policy; limited enforcement powers of the Commission vis-à-vis member states; lack of consensus among major stakeholders 10

  11. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Do we have a Europeanenergypolicy ? (7) • Overall conclusion: • High degree of fragmentation (no comprehensive and consistent approach of energy issues) • No common energy policy, but ineffective collection of national policies • No guarantee that Europe and its member states will be leading players in the societal change resulting from new industrial revolution 11

  12. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (1) • Two choices: • Do nothing and undergo crises? • Do something, but if so, how? 12

  13. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Movingtowards a EuropeanEnergyCommunity (2) • The Need for Energy-Specific Action: • Basic product: energy is at the basis of all societal activity • Inelastic demand: on short term customers expect to be served • No growth: growth should be contained or steered • Grids: new energies are network related 13

  14. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (3) • The Need for Energy-Specific action at European level: • Objective requirement: no member state has the resources to face the challenges on its own • Legal requirement: to maintain the current level of integration of internal market • Normative requirement: fostering cohesion and solidarity between members states • Political requirement: speaking with one voice on the international scene 14

  15. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (4) • The Need for Efficient Action: • Decision-making power, internally and externally, leading to enforceable results • Budget: power to fund own projects • Coordination and steering R&D, stocks, reserves, prices and portfolios • Acceptability: democratic and supported by stakeholders 15

  16. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (5) • What does this imply? • Substantive measures • Institutions that can deliver 16

  17. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (6) • Substance: • Well-functioning energy internal markets (contestable and liquid markets as primary source of innovation) • Integrated and smart networks • Price stabilisation mechanisms • Diversifying Europe’s energy portfolio by R&D, allocation and pooling • Crisis management and strategic reserves 17

  18. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (7) • Powers and institutions: • Stakeholder involvement in consultative committee • European regulator and agency • Fiscal powers • Energy Fund • External powers to represent Europe on international scene 18

  19. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (8) • How to translate these requirements in adequate institutional framework? • All or Some member states? Not a requirement for all but open to all • In or Outside the Union Structures? Interaction but not necessarily locked in • The Scope of the Policy? Not static (fuels/techno, etc.) In/Outs 19

  20. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (9) • Four main options: • Lisbon Treaty • Enhanced Cooperation • New Energy Treaty • Schengen Model 20

  21. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (10) • Option 1 – The new energy policy under the Lisbon Treaty • Codification of the current practice • Carefully crafted compromise between national sovereignity over resources and taxation, and a shared Union competence for the rest • No definition of solidarity • Foreign Policy (HR+EEAS): remain intergovernmental and no energy-specific Assessment : No prospect of radical change, fragmentation will remain. 21

  22. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (11) • Option 2 – Differentiated integration in the EU: Enhanced cooperation • Art. 20 TFEU – Political reality: willingness to cooperate differs from one member state to other • Pre-conditions: to achieve Treaty objectives / 9 countries / open to all / Council decision • Condition of last resort • Other option: micro-flexibility (derogations, options, etc.) Assessment: Art. 20 step in good direction but conditions hard to meet. 22

  23. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Movingtowards a EuropeanEnergyCommunity (12) • Option 3 – A New EuropeanEnergyTreaty • Fully-fledged: all measures / powerful and supranational approach / majorityvoting • Opt-in: open to all – likeMonetary Union • Under the EU structure – take the place of ECSC Assessment: best option available, all in one go. 23

  24. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (13) • Option 4 – Functional and/or regional arrangements: the Schengen model • Cooperation in certain areas on a functional and/or regional basis: trading platform, network treaty, pooling R&D projects and resources • Various degrees of intensity: pragmatic and voluntary / new partnerships and international arrangements • Schengen Method: concluded outside then reintegrated insie EU structures Assessment: middle-of-the-road option, effective on some specific policy items. 24

  25. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (14) • The Optimum Solution: Conclusion of a New Energy Treaty • To take efficient, European and energy-specific action on all items on the menu • Inside EU / open to all / supranational / represented on the international stage / democratic • Under EU structure ensures compatibility with acquis However: May take some time before a European Energy Community is conceived, negotiated, concluded and ratifies; Necessity to develop interim measures. 25

  26. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (15) • Pragmatic Start: Interim Solutions and Ingredients for the New Community • Network Community • Energy Fund • Gas Purchasing Group(s) 26

  27. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Movingtowards a EuropeanEnergyCommunity (16) • StrengthenedCooperation for Energy Networks • Creation of effective EuropeanRegionalEnergy Networks (ERENs): building block for a comprehensive single Europeanenergymarket • Institutional model: South East EuropeanEnergyCommunityTreaty • Coordination between national regulators and withEuropean institutions • Higherlevel of integration: creation of independentregionalexecutiveagencies 27

  28. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Moving towards a European Energy Community (17) • A Common Energy Fund for Developing New Technologies • European-wide R&D programmes supported by adequate funding facilities • Various sources: energy levy on polluting forms of energy production, etc. • Useful instrument: European Grouping of Territorial Cooperation (EGTC) to promote cross-border, transnational and interregional cooperation 28

  29. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Movingtowards a EuropeanEnergyCommunity (18) • The Establishment of a European « GasPurchasing Group » • By privateoperators and/or member states • Based on existing EU legislation on competition • Offers a real negotiating power vis-à-vis externalsuppliers • Higherlevel of integration: creation of a GasSupplyAgency 29

  30. www.notre-europe.eu www.notre-europe.eu 15/09/2014 15/09/2014 Conclusion – A Common Answer to Common Challenges • A two-prongedapproachpolicyproposal: • Interim solutions: ad hocmeasures on specific issues adopted by the EU and somemember states • Long-term objective: creation of a EuropeanEnergyCommunityunder the presentnion structure following the example of the Monetary Union (a fully-feldged and opt in treaty) 30

  31. www.notre-europe.eu www.notre-europe.eu Thankyouforyour attention!

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