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The Energy Council (15 February 2007) This morning the Energy Council took place. The Conclusions note overall strong support for the concepts and objectives underlying the energy package put forward by the Commission on January 10th. However, the Council shies away from reaching any definitive decisions on the concrete proposals from the Commission. The full text of the Council is available on our website here. Update: a video of the press conference can be watched here. The most important conclusions are: The Internal Energy Market For the first time the Council acknowledges that further measures (i.e. a third liberalisation package) now needs to be adopted. However, regarding the measures that such a third package should contain, whilst the Council makes some progress and seems to agree with the objectives underlying the Commission's proposals contained in the Strategic Energy Review (at least in principle), it leaves open the question of unbundling and to some extent how to coordinate regulation at the European level. In particular the Council agreed: - on unbundling, whilst the Council agreed on the importance of unbundling to give effective access to markets and guarantee investment, no agreement was reached in the Council on this, with a number of Member States lead by France and Germany wishing to continue on the basis of the existing approach (legal unbundling - this is in reality what is meant when the French Minister talks of the "French model", or "regulated unbundling") and others (lead by the Sweden, Finland, Denmark, the UK, the Netherlands) which argue for ownership unbundling (at least for electricity). The Council conclusions therefore mention no specific option to be pursued or even favoured, instead using a formula that could cover all options: "effective separation of supply and production activities from network operations (unbundling), based on independently run and adequately regulated network operation systems which guarantee equal and open access to transport infrastructures and independence of decisions on investment in infrastructure". It seems that this issue will be reserved for the Heads of State in the March, and possible the June, European Council (i.e. after the French Presidential elections). - on the need for further harmonisation of the powers and strengthening of the independence of national regulators. On this issue the Council therefore agrees in principle with the Commission's approach. It remains to be seen whether the Member States will agree with the precise measures that the Commission propose (expected later this year) to put this principle into practice. - on the need to establish "an independent mechanism for national regulators to cooperate and take decisions on important cross-border issues". Thus, of the options identified by the Commission in the Strategic Energy Review on this issue, the Council seems to have agreed on an ERGEG+ type of model (in the Strategic Energy Review this was described as the "European Network of Regulators"). However, again, it remains to be seen how this model will look in practice; in reality there remains much to be decided on this issue. - the "creation of a new Community body for Transmission System Operators to improve coordination of network operation and grid security building on existing cooperation practices". In other words, the Council agrees with the Commission's proposal that the existing cooperation between TSOs, via ETSO, be reinforced by giving it a formal recognition and role. In reality, this probably means creating a formal TSO Committee, similar in form to the existing ERGEG for regulators. - "welcomes the Commission's intention to appoint co-ordinators for key infrastructure of Community interest" and "invites the Commission to table proposals aiming at streamlining approval procedures". In terms of streamlining national planning procedures, in the Strategic Energy Review the Commission proposes that Community legislation be adopted which obliges Member States to complete planning procedures for projects of European Interest (i.e. key interconnectors) within 5 years. Again, whilst Member States agree on the objective, it remains to be seen whether they will agree with the concrete proposal expected to be tabled by the Commission towards the end of this year. In terms of the next steps, the Council requests the Commission "to provide additional clarifications related to the key measures envisaged and their impacts in time for the June (energy) Council". Whilst this might be interpreted as the Council seeking to delay any possible decisions on these issues by the Heads of State at the March European Council, the loose phrasing of the statement seems to indicate that this simply keeps the options open in this respect. It clearly is not intended to mean that formal legislative proposals on these issues are requested for the June Council. Sustainablility (CO2 targets, renewables and energy efficiency) The Council endorses the key energy targets put forward by the Commission in this area in its Strategic Energy Review (20% renewables in the EU's energy mix by 2020, 10% minimum biofuels in each Member State by 2020, 20% improvement in energy efficiency by 2020). However, the Council neither supports nor rejects the Commission's call that the 20% renewable energy target be implemented through legally binding obligations on Member State (in order to reach the overall 20% renewables target different Member States would have to have different targets, some higher than 20%, some lower). Again, this will have to be decided by the Heads of State at the March or June European Council. On biofuels, however, the Council specifically agreed to a "10% binding minimum target to be achieved by all Member States for the share of biofuels in overall EU transport petrol and diesel consumption to be introduced in a cost-efficient way. The binding character of this target is subject to production being sustainable, second-generation biofuels becoming commercially available and the fuel quality Directive being amended accordingly to allow for adequate levels of blending". In practice, this means that each Member State will be given a legal obligation to meet the 10% minimum by 2020 (unlike the overall renewables target, which would be converted into differing targets per Member State). This legal obligation will be subject to the conditions mentioned above being met, which appears certain. Thus, in reality the Council has agreed a mandatory, minimum 10% biofuels target for every Member State by 2020. The Council calls for the Commission to table in 2007 a "new comprehensive Directive on the use of all renewable energy resources [including]…Member States' overall national targets, National Action Plans containing Sectoral targets and measures to meet them.". Energy Technologies. The Council welcomes the Commission's intention to table a Strategic Energy Research Initiative in 2007 and, in particular "welcomes the Commission's intention to establish a mechanism to stimulate the construction and operation by 2015 of up to 12 demonstration plants of sustainable fossil fuel technologies in commercial power generation".  Other articles from February:
List all messages of the previous month: January 2007 List all messages of the next month: March 2007 |