The nexus between climate and energy policies in Europe

The nexus between climate and energy policies in Europe / Antony Froggatt, Luigi Carafa, Umberto Marengo et Marine Confavreux Zimmermann. Summary of the discussions at a roundtable held in April 2012, Chatham House, 20 p.

http://www.chathamhouse.org/publications/papers/view/190329

Key points (© Chatham House) :

• The adoption of the 2009 Climate and Energy legislative package marked a paradigm shift in the EU from the domination of market consideration to a more climate-centred energy policy. This happened under exceptional conditions: the upcoming Copenhagen summit, the Commission and Council Presidency’s joint activism, the election of the president of the European Commission, a greater level of public awareness and powerful EU member states willing to put in place pan-European legislation.
• The policy conditions that enabled the agreement on the EU Climate and Energy legislative package at the end of 2008 are no longer the same. The impetus for addressing climate issues appears to have diminished and EU decision-makers have shifted their focus towards more short-term pressing problems, such as rising levels of public and private debt, increasing unemployment and the eurozone’s daunting challenges.
• While climate change concerns have lower priority on the political agenda, security aspects of the EU’s energy policy have continued to gain salience. The Commission is seeking to carve out a negotiator role with external energy suppliers. More recently, the contentious issue of shale gas has also come to the fore.
• The negotiations on the Energy Efficiency Directive clearly indicate that, in times of crisis, climate change and economic/industrial objectives may be in conflict. The benefits of energy efficiency are potentially large but mainly long-term, while the upfront costs are significant. Persistent efforts by the Council to weaken the Commission’s proposal demonstrate how, in the current recession, some member states are unwilling to impose further legislative requirements on their industrial sectors and populations.
• The 2008 exceptionalism is over but its legacy remains. Looking towards the setting of post-2020 targets, the support for renewable energies could constitute common ground for reconciling supply security and climate change concerns, provided grids are adapted and investments in flexible, back-up plants are encouraged (for example through the creation of capacity payment markets).