On 18 November Commission Vice-President, Maros Sefcovic presented the first State of the Energy Union report in Brussels. The Juncker Commission, now in office for around a year, has made the creation of a European “Energy Union” one of its key priorities, and so the first progress report was eagerly awaited.
The Energy Union is seen as having five main dimensions: energy security, solidarity and trust, a fully integrated European energy market, energy efficiency, decarbonisation and research & innovation. The intention is not only to move forward with European initiatives in these areas but also to promote greater consistency of national energy policies.
The Energy Union report was generally upbeat. Europe continues to lead the way in the low-carbon energy transition. In particular, EU is meeting its targets on greenhouse gas emissions, renewables and energy efficiency, as well as making progress on the single market and security of supply. The report also contained a set of factsheets for each Member State, identifying how national policy is contributing to, and can benefit from the Energy Union.
The Commissioner noted that 2016 would be the “Year of Delivery”. The Commission plans to revise most existing European legislation on energy in the course of the year. A first “package” covering gas security of supply and heating & cooling strategy will be tabled in the first quarter of 2016, but the major proposals will come at the end of the year. Mr Sefcovic indicated that the Commission would bring forward legislation on electricity security of supply, energy efficiency and renewables, which will set a framework for the post-2020 period. He hinted at ambitious goals for market integration, noting that the Commission would seek to “transform” electricity market design, adapting it to new technologies and ensuring a level playing field.
Mr Sefcovic has so far won considerable plaudits from Member States for developing the Energy Union concept and most governments have been supportive of his approach. However, the process of producing detailed legislation next year will certainly be a challenging one, particularly given the major differences in national energy policies. This is particularly visible in the range of national views on the fuel mix: Germany and some other Member States see renewables as the future mainstay of energy markets, while others, including the UK, prefer to keep a variety of options open. While all EU governments support the concept of more market integration, it remains to be seen how far they are willing to share some responsibility for security of supply at regional level, e.g. by establishing regional transmission system operators.
It looks that 2016 will be a particularly interesting year for the European energy sector.