Please note that this does not constitute a formal record of the proceedings of the meeting. It is dependent on interpretation and acts as an unofficial summary of the debate.
On June 13 2014, the Energy Council discussed a document prepared by the Presidency and the Commission, containing three points for discussion:
Follow-up to the March 2014 European Council
(a) Completing the internal energy market in 2014 – Information from the Commission
(b) Communication from the Commission on a "European Energy Security Strategy" (EESS) – Presentation by the Commission
(c) Communication from the Commission on "A policy framework for climate and energy in the period from 2020 to 2030" – Policy debate
The questions for the discussion were the following:
Q1: In light of the Commission Communication on a European Energy Security Strategy do delegations wish to amend or further refine the lines of action set out at Annex II and if so, how ?
Q2: Securing adequate interconnections, within the EU as well as with its neighbours, is a key component of energy security:
• How would you define interconnection objectives for 2030 and on the basis of which criteria?
• Taking into account the criteria already set in the TEN-E Regulation do you see the need to give a higher priority to certain PCIs?
Q3: Energy policies at EU and national level are contributing to and impacted by all the components of the envisaged 2030 framework, and will have to contribute the lion's share of the implementation process. In this respect what do you see as the most essential elements of the framework that need to be defined as part of the set of orientations to be agreed in October and which elements can possibly be left for later?
Please find below an excerpt of the discussions.
The Greek Presidency introduced the topic and said the Commission would first give oral information on the completion of the internal energy market, noting that the Commission’s formal report would only be adopted after the TTE Council.
Second, the Commission would give a presentation on the European Energy Strategy. Third, there would be a policy debate on interconnections. Lastly, there would be a discussion on the climate and energy 2030 package.
Commissioner Gunther Oettinger began by stating that the three points were closely linked. He wanted to talk about the gas developments regarding Ukraine during lunch (not publicly displayed).
The European Council at the end of March made a request to the Commission to talk about import dependence and security of supply and how to reduce it.
Towards the end of May, the Commission published an energy security strategy. Many Member States such as Poland and Sweden had made comments.
There has been a crisis between the Ukraine and Russia. Europe was the biggest import market in the world for coal, gas and uranium.
The Commission had focused on short, medium and long term measures.
On coal, there is a diversification of supplies and sources. For oil, there are comprehensive transport routes. In the past, the EU has overcome oil crises. He mentioned the civil crisis in Libya and Iran.
Russia was a major provider of oil but there too, there were no bottle necks that could not be overcome. Recently, discussions had been had there with OPEC.
Dependency was mainly due to gas. This was because the number of transport routes was limited to certain pipelines. This is also why there was likely to be no world market for gas. How to reduce import dependency was now the question.
In recent months, the EU had produced a coherent policy of talking with one voice. This was good.
Of the EU Member States, UK, Ireland, Portugal and Spain were independent but 18 Member States (MS) were dependent on Gazprom but they had a second source so there are beginnings of diversification there. 6 MS including the Baltic states and Finland, only had one route. Partly, that route runs through Ukraine.
The EU has been working on projects of common interest, also in the context of the Connecting Europe Facility to have reserves in Europe, storage and to move about the gas from one Member State to the other.
When talking about the EU energy policy, partner countries, such as Ukraine are also important.
In the medium and long term, imports should be reduced. Renewable energy should be developed in an efficient way as well. The European Council in October will comment on the 2030 aims. This is positive. He called upon the MS to prepare the energy side for the 2030 package.
Many MS had given the Commission their views on the 2030 strategy. He called upon the remaining countries to do the same ahead of a meeting the following week to prepare the European Council.
In the immediate term, the objective is to survive the winter, and gas bottle necks have to be avoided. The emergency mechanisms will be analysed in the coming weeks. The European Commission wants to carry about a stress test review together with the national gas authorities. In case the worst case scenario happens, we have to see how to supply citizens.
The EC thought that the stress tests would give important information. The G7 recently looked at the issue of energy security and it has decided to give a role to the IEA. Japan had talked about the numbers of LNG it needed, but this was a case apart. Japan and South-Korea are competitors. The USA and Canada are more important within the G7 because they are oil and gas producers, wanting to export their products to other countries. This is important for the energy section of the TTIP.
Thinking of Turkey and Azerbaijan, also working with the US, we can diversify the energy sources.
The US has a crystal clear position on Ukraine, they do not take gas from Russia as long as the crisis is ongoing. We have to cooperate with the US but not completely follow their example on wholesale markets.
The EU must also speak with one voice. The Norwegians, Azerbaijans and the rest must know that the EU has one voice only.
In the case of South Stream, a divided situation in Europe was not possible. European state aid and environmental law should be followed. On the Russian partners, the Commissioner noted that they had “known everything about the EU legislation but they did not accept it”. However, Putin’s policy was rather transparent and thus not difficult to read.
There was a first list of projects of common interests on the table. This was a good thing for the regulators and TSOs. The Commission had looked at gas and electricity projects and which of them were the most crucial right now. This was also about authorizations. “The PCIs are the best bet before the Courts” he added referring to possible cross border disputes.
With the CEF, the project bonds were ready to create market loans and leverage.
He then called for solidarity in terms of the Projects of Common Interest (PCIs). The projects are equally important but the level of urgency differs. The projects related to Baltic projects are particularly urgent. Currently, 27 projects in gas and 6 electricity projects have been earmarked as particularly urgent.
Now, the funds earmarked for CEF for 2014 and 2015 would have to be deployed. The Iberian peninsula would not be forgotten. But the Russians should be showed that the EU was ready to start to build up the projects by the end of the year. This would be the EU answer to the Ukraine-Crisis.
Unfortunately, for the CEF, the resources and payment appropriations for 2015 fall shorter than expected. Energy infrastructure projects have been making cutbacks, which is short sighted. The EU was not ambitious with 5,8 billion Euro. Therefore, “let’s keep fighting on that front – we need every Euro we can get”, he added. The money that was there was just not enough to meet objectives.
In the electricity sector, the PCIs are there. 10 % is the target figure. For 2030, this should be raised to 15 % so that each Member State can meet 15 % of electricity needs from a neighboring Member State and vice versa.
For the gas sector, there should be reverse flows. There should not be one way gas pipelines only; the gas should go in the other direction as well. Moreover, with the LNG terminals progress should be made: he mentioned Poland, Lithuania and Latvia in that respect.
The Southern Corridor for gas is also very important. Turkey was ready to go ahead with the Azerbaijan plans. He asked the Italians to mediate in this area for a rapid decision.
For Italy, it should be possible for billions of gas to the transported to Europe via Europe. The Russians might look for a different location in Italy.
On gas diversification, he mentioned a big conference in Valletta in Malta. They had invited all eastern Mediterranean area; Israel, Lebanon, Turkey, North African partners. Over two days the potential (for gas) would be discussed and what infrastructure was needed (LNG, pipelines, offshore drilling, etc.) for opening a new pipeline in Eastern Mediterranean.
As for the EU election results, he mentioned that he was disappointed by the lack of energy discussions. He then talked about energy efficiency and EU projects on the ground. It was a pity that the elections made the Commission’s actions on ecodesign as the “stupid activity of Brussels”. He would gladly drop the area of ecodesign altogether.
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