EU ROUND UP – EU RELEASES COMPREHENSIVE EMISSIONS TRADING AND RENEWABLES PROPOSALSFebruary 1st, 2008
BY KEITH NUTHALL
A COMPREHENSIVE raft of new legislation designed to force the European Union (EU) into further reducing its greenhouse gas emissions has been tabled by the European Commission. As expected, it has proposed targets that biofuels command 10% of the EU’s liquid fuel consumption by 2020. And the Commission has also proposed formal targets that the EU increase from 8.5% at present to 20% by 2020 the share of renewables in aggregate energy consumption – an average annual increase of 11.5% – considering all the sub-sectors – wind, tidal, solar, geothermal, hydropower and biomass. On emissions trading, it has proposed forcing the power industry to purchase saleable emissions trading permits by auction from 2013, not given away, as at present. Demands on other industries participating in the EU emissions trading regime to buy auctioned permits would be phased in.
And although the Commission currently decided not to include the transport sector in its emissions trading system, Brussels wants to impose demands on it and other non-trading sectors to reduce their greenhouse gas emissions. These would have to meet national targets: Britain for instance would have to cut its non-trading sectors’ emissions by 16% from 2005 to 2020.
The proposals have not been universally welcomed with open arms. At its first debate this month (Feb), the EU Council of Ministers indicated they may push for more trading of certified green energy when amending the legislative package. And some experts have doubted whether the renewables targets are achievable: French-coordinated renewable energy researchers eurObserv’ER has said the EU will not achieve an earlier 12% target share of renewables in its overall energy mix by 2010. Johannes Teyssen, of the World Energy Council, has warned the emissions restrictions will cause power companies to abandon plant building plans, risking the EU’s energy security.
Meanwhile, a European Parliament hearing on the Commission’s earlier unbundling proposals have shown a continuing stalemate, with not only MEPs being split on the issue, but the private sector too. Luigi de Francisci of the Italian national grid Terna stressed the increased liquidity released by unbundling, while Florian Haslauer, of consulting firm AT Kearney backed his company’s recent report’s conclusion: “There is no empirical evidence that ownership unbundling leads to more competition.”
Other EU news:
*The European Investment Bank has shown how it could boost European Union biofuel production capacity, with a planned Euro 41.5 million loan to Hungarian manufacturer Tempora Bioenergia Zrt. It proposes using the funds to build two oil mills and an attached biodiesel refinery with a 100,000 tonnes per annum production capacity.
*The European Commission has welcomed the resolution of the latest Ukraine-Russia gas supply dispute, with RosUkrEnergo being replaced as the intermediary between the neighbouring countries, with a 50-50 joint venture owned by their national gas monopolies Gazprom and Naftogaz.
*The European Investment Bank is planning to lend up to Euro 1 billion to Spain’s Enagas to fund 50% of the costs of the utilities’ plan to boost the country’s LNG import, and natural gas transmission and underground storage capacity.
*The European Court of Justice (ECJ) has declared illegal under European Union (EU) law Spanish regulations that limit the voting rights of publicly-owned organisations on energy utilities in Spain. These rules have been criticised by the European Commission for preventing potential takeovers by foreign companies.
*The European Commission is threatening Poland with legal action at the ECJ over its system for awarding prospecting, exploring and producing rights for natural gas within its territory. Brussels claims the Polish system is insufficiently transparent.
*A comprehensive air pollution data service is being created by a European Environment Agency and European Space Agency consortium, which will marry information from satellites with ground-based readings from 29 European countries. http://www.eea.europa.eu/themes/air