EU Council adopts first decisions on Energy Union governance

The European Transport, Telecommunications and Energy (TTE) Council took place on Thursday (Nov. 26) in Brussels. Luxembourg Minister for Economy and Foreign Trade Etienne Schneider chaired the meeting and Vice President Šefčovič and the commissioner for energy and climate Cañete represented the EU Commission.

The meeting was tasked with discussing and adopting shared positions on the EU Energy Union and related issues.

The Council defined a general approach on the proposal for a Regulation on energy efficiency labelling of energy related products as indicated within the Commission’s Energy Union “summer package”. The launching of a public consultation process on a new energy market design and a new deal for energy consumers (indicated in the Commission’s package) were discussed at the Council meeting, while legislative proposals are expected during the second half of 2016.

Top of the agenda, the Council adopted a set of conclusions on the Energy Union governance. The concept of an European Energy Union was introduced in October 2014, when the newly appointed Vice President Šefčovič endorsed such vision, consisting of five pillars:

  • security, solidarity and trust;
  • internal energy market;
  • modulation of demand;
  • decarbonisation of the energy mix;
  • research and innovation.

With Thursday’s decision, the Council brought forward the work undertaken in February, when it adopted the Framework Strategy for a “Resilient Energy Union“. In that occasion the EU body highlighted a set of proposals to transform the EU energy system, and reaffirmed that “the implementation and enforcement of existing EU legislation” was the first priority of this strategy.

The achievements made in the months following the Framework Strategy were assessed in the recent Commission’s “State of the Energy Union“. The report was presented by Commissioner Šefčovič the week ahead of the TTE Council meeting. The document set the guidelines for the legislative proposals to be finalized in 2016. By next year the EU bodies will have to lay “the foundations of a robust governance system bringing predictability and transparency, which is what investors need”, Šefčovič declared. Strategic planning is considered by the Commission’s report as “matter of serious concern” since so far only around a third of Member States have a comprehensive energy and climate strategies.

The State of the Energy Union also identified the essential components of the governance system, that the Council was tasked to adopt:

  • A National Energy and Climate Plan to be adopted by each Member State, covering the period from 2021 to 2030 and reflecting the five dimensions of the Energy Union;
  • Biannual Progress Reports on the implementation of the National Plan;
  • Constructive dialogues between the Commission and the Member States;
  • Monitoring and evaluation based on key indicators.

To support such framework, the Commission coupled the ‘State of the Energy Union’ report with a guidance document on what should be the trajectories of the National Plans, as well as series of factsheets on 28 countries’ current regulatory status and a list of 23 indicators to measure progress. Furthermore, in the first half of 2016 the Commission is expected to unveil a new “reference scenario” to form the basis for assessing Member State contributions to the Energy Union.

The UK-based Center for European Reform underscored how the framework of the Energy Union is yet lacking a true integrated plan, and that the pillar’s division and the National Plans requirement do not bring clarity on the tradeoffs between the five objectives at national and European level.  In the Center’s view, the Energy Union governance framework will have to balance market integration and emissions reduction and also to allow member states to choose the best and most cost effective way to meet their GHG targets.

Finally, the EU Council endorsed the new rules on export credits to coal-fired power plants, developed within an OECD framework on Nov 17.

The next Transport, Telecommunications and Energy Council is scheduled for Dec. 12.


(Image: European flags in front of the Berlaymont building, headquarter of the European Commission, Brussels, Belgium. Photo credit: TPCOM/Flickr)