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26/08/2016

EU seeks new powers to vet member state energy deals

Energy

EU seeks new powers to vet member state energy deals

Maroš Šef?ovi?

[European Commission]

The European Commission wants the power to review energy deals between member states and countries such as Russia before they are signed, the bloc’s top energy official said on Tuesday (26 January) –  a move opposed by some states reluctant to cede control to Brussels.

European Commission Vice-President Maroš Šef?ovi? said the new powers for Brussels were a key part of draft energy security rules he intends to propose next month.

The energy security package aims to move the 28-member bloc towards a single energy union in which power and gas would flow freely across borders, reducing reliance on Russian gas.

“We are going to introduce this ex-ante check of the intergovernmental agreements,” Šef?ovi? said.

“We should develop the mechanism where we would have the possibility to look into the intergovernmental agreements in a way that we would make sure that once concluded, they are compatible with EU law.”

The web of deals Russia cut with Eastern European states to build the South Stream pipeline under the Black Sea morphed into a legal headache when the EU executive said it did not comply with rules on ownership or third-party pipeline access.

The oversight powers sought by the European Union would avoid the difficulty and complication of trying to renegotiate bilateral agreements after the fact, Šef?ovi? said.

He acknowledged overcoming objections from some member states may be “a complicated discussion”.

Plans for pipelines to pump more Russian gas to Europe, including the expansion of the Nord Stream link to Germany, have pitted states who see it as a solution to supply disruptions via Ukraine against those worried about dependence on Russia.

>> Read: Tusk joins ‘Visegrad Four’ in attack on Nord Stream 2

Concerns about Russia’s dominance have increased since Moscow’s annexation of the Ukrainian region of Crimea.

Germany, which has negotiated successfully with Russia’s Gazprom in the past, was opposed to greater EU transparency when the issue was debated by EU leaders in March.

Germany feared more transparency could lead to the disclosure of sensitive information whereas Poland, which pays higher gas prices, was in favour.

>> Read: Putin and Gabriel team up on Nord Stream 2 against Brussels

Gazprom, which supplies about a third of the EU’s gas, mostly across Ukraine, is the target of an EU antitrust investigation for allegedly overcharging customers in Eastern Europe and thwarting rivals.

Gazprom declined to comment on the proposal.

Background

When he was Prime Minister of Poland, Donald Tusk spearheaded the idea of an EU Energy Union. The idea has since been taken up by the European Commission which nominated a special Commissioner, Maroš Šef?ovi?, to steer the project.

Details of the proposal started to emerge in February 2015, when the College of Commissioners discussed the plan for the first time. A first communication was published on 25 February, and included an annex of “concrete proposals”, including a list of priority infrastructure projects eligible to receive EU funding.

>> Read: Energy union aims for elusive 10% power grid interlinkage

Šef?ovi? followed up in November by laying down legislative plans until the end of the Commission's term in 2019.

>> Read: Commission outlines Energy Union legislative path

The Energy Union will cut across a number of policy sectors including energy, transport, research and innovation, foreign policy, regional and neighbourhood policy, trade and agriculture, according to the EU executive's plans.

>>Read: EurActiv's full coverage on the Energy Union

Further Reading

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