“Energy Union”: a packaging? Yes… with a content…

Rome– Seminar Edison(25 March 2015)Jean-Michel Glachant Director “Florence School of Regulation”@ European University Institute – Florence (Italy)

I/ 2005-2009 EU gets “full” energy policyWhat was it about?

Previsibility (foreseeability) very low: “EU energy policy” was not at all foreseen in 2004; and…. already “packaged” in 2009!

• Game Changer 1 2005 Hampton Court Council Tony Blair: long life EU internal Security of Supply

• Game Changer 2 2007 (Lisbon treaty) Berlin Council Angela Merkel: long life EU energy sustainability 20-20-20 in 2020

• Game Changer 3 2006&2009 Russia-Ukraine: external security plans + SoS Reg. 2010 & Infrastr. Package 2011-13

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II/ 2013-14: Countries ask for “RES cease-fire”; Commission agrees

#November 2013: RES major policy shift without debate or vote = guide lines (+ corridor gossips: Berlin policy dead)

November 2013 - Guide lines for RES support till 2020 / Only small units & less mature RES (as off-shore & bio-mass) keep FiT / big units and deployed RES only FiP & Tgy neutral auction (ex: On-Shore or PV 1MW

#Confirmed January 2014: Berlin 20-20-20 “game over”. Competitiveness & energy cost control back to topJanuary 2014 - Framework post 2020 / *“EU binding GHGtargets +**MS only RES target & “appropriate “ EU governance for MS action plans

# Is EU energy policy dead then? Or still alive? Who knows? >> Summer 2014: Juncker’s team ‘Towards An Energy Union” + VP What?

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1- 25 February 2015: Commission COM. ‘’Towards an Energy Union’’ NB: ‘Energy Union’ has NO predefined content; is only ‘catch word’.

It is NOT a new institution (like an EU Treaty or pro-Treaty (Schengen-like Agreement) Or even an EU body (say ‘ACER’ or ‘ENTSO’).

SO many alternative ‘Energy Union(s)’ are conceivable even an ‘Empty Box’

III. 2015-2020: An empty EnergyUnion? ~1 / Internal Market BAU?

2- Energy Union <mini> to boost Internal Market >> Eurelectric, Eurogas (EU) put new tag on (existing institutions + BAU) = let’s call it Ener.Un: BUT it targets ’Only’ ‘Internal Market’ extended to RES & Capacity Mechanism being fully ‘market based’; and ‘technology neutral’.

However such EnergyUnion-BAU ends a bit undefined: ¤ MS have strong power to take ‘outside the market’ initiatives #Germany: Off-shore + Energy Efficiency push #UK: SoS being Capacity mechanism + LT contrat with UK Nuclear or tidal + off-shore + ISO Grid +? #France: own Capacity mechanism + Off-shore too? + Will put EDF as shareholder of Areva + to strangle ‘EPR’ (or send its IPR to China)? But creating new ‘small’ nuke reactors 600MW again with China; etc ¤ >> Then: at what speeed Commission could follow or catch-up MS?

III. 2015-2020: An empty EnergyUnion? ~1 / Internal Market BAU?

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III. (1) Commission’s 25 Feb./Not BAU for #Market Design and #Governance?

1- EU 4th Big Package Internal Market & Governance#Market *Legislation 2016; retail & wholesale; integrating RES; phasing out non market based support; coordinating Capacity Mechanisms .**Legislation 2018 Electricity security of supply (= ‘recall’ of national SoS)

#Governance***Review framework from 3d Package notably for ACER (to ++power of Europeanizing regulation) & ENTSOs (to ++ as regional operational entities to create)****Propose guidance for ‘regional cooperation for market integration’ and to act at regional level wih regu. Bodies, MS and stakeholders*****Create ‘Energy Infrastructure Forum’ with MS, Regional coop. Groups, and EU institutions (ACER? Banks?) by late 2015

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IV. (2) Commission’s 25 Feb./Not BAU for #Supply Security and #Ext.Governance

2- EU actions for Security of Supply#SoS *Legislation: Revision Gas Regulation by 2015-2016

** Implementation of existing PCIs with adequate financing** *Strategy for LNG an its storage** **Council 19-20 March : explore feasibility of gas joint-buying mechanism

#ExtGov ** ***Legislation: Revision Decision International Agreement for Commission to intervene ex ante before signature of agreements with 1/3 countries** ** **Coordination Commission / HR-VP / MS to create international diplomacy for energy & climate issues; for international treaties (as TTIP) or within WTO, and launch new initiatives (as agreement with India, with China ;etc) in field RES, Ener.eff, etc.

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IV. (3) Commission’s 25 Feb./Not BAU #for Sustainability beyond Market

3- Fields of EU actions for sustainability: *Legislation to revise EnerEff directive &make proposals to meet 2030target**RES package by 2016-17 incl.sustainable &cost-effective biomass, biofuels*** Legislation to achieve Oct2014GHG target in ETS & non-ETS sectors** **Legislation ‘Full Road Transport Package’ covering efficient pricing of infrastructures; rool-out of intelligent transport; enhancing ener.eff-------------------------------------------------------------------------------------------------------** ***Strategy to facilitate Investment in efficient ‘Heating & Cooling’** ** **Create Smart financing for smart buildings fund** ** ***To push MS & regions to use more the funds to renovate housings-------------------------------------------------------------------------------------------------------**** **** Strategy for transport research & innovation agenda**** **** *Revision ‘Strategic Energy Technology Plan’

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How to conclude? Yes a content (a full catalog of!)#Many Energy Union(s) drafted on 25th Feb. #Which (s) to get? #I don’t know! # To be seen in 2015-17…

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Have a look at IAEE journal I am chief-editor of!!

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Thank you for your attention

Email contact: jean-michel.glachant@eui.eu

Follow me on Twitter: @JMGlachant already 6 617 tweets

My web site: http://www.florence-school.eu