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The EU Energy Union… to come?

By Jean–Michel Glachant
Director Florence School of RegulationLoyola de Palacio Professor

19 February 2015

 

On 25 February the European Commission is to tell what it puts into the empty box of “Energy Union” (a very catchy word…). We already know that it won’t be a “Union” because no institutional change will be made at the EU level. Hence it will only be a new European energy policy called a “Union”. What might then be so “new” about this new energy policy (apart from the title)? For the full picture, read the #FSR Manifesto… To cut the long story short:

  1. Achieving the EU internal energy market, with a massive amount of renewables in electricity and a tremendous Russian gas pressure on the EU-Ukrainian border, might call for many new market rules and more harmonisation of the already existing ones; also for a better Europeanisation of existing and new infrastructures. This means demanding more “Union”.
  2. Achieved or not, an EU wholesale energy market does not necessarily imply a vibrant and smart retail market open to innovation in processes and services – same as what is happening with  Google, Apple, Uber, AirBnB, etc. pushing for taxis, hotels or banks. Will we get a very loose retail opening or a real “smart retail Union”?
  3. An EU energy market is not the ultimate goal, as the EU really targets demanding Climate Change goals for 2030 and 2050: how to align our markets, our companies, our regulations, and all their vested interests towards a significantly “Low Carbon” economy and society? More “Union” for more sustainability?
  4. Both Russia and the Middle East are boiling and shelling the EU borders: how to get some “external energy security”? Some “Union” or the same “EU disunion”?
  5. How is the EU going to deliver any of those 1 to 4 within the same set of institutions? Only empty words or a fairy tale? More “Bottom Up Governance”? Any new EU level player (as a single regulator), or only a revamping of existing bodies (the EC.VP for “Energy Union”; the ENTSOs; the ACER; etc)?

First answers to come on 25 February….But do not dream too much: a debate like that could last 12 to 24 months…or more!

 

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