EU plans to build an ‘energy community’ to deal with the challenge of climate change, security of supply and competitiveness are “as full of risks as […] hopes” given the “violent conflicts of interest and prejudices” involved, according to Philippe Herzog, president of French think tank Confrontations Europe.
Herzog outlines two major problems dividing Europeans – the choice of energy sources and the regulation of markets.
The EU currently depends on fossil fuels for 80% of its energy, so producing 20% from renewable sources would only provide “complementary sources of power” and leaves problems of competitiveness and security of supply “wide open”, he claims.
Herzog says that member states’ energy choices must complement each other if the EU is to develop a “coherent energy mix in line with its objectives” on renewables, energy efficiency and reduction of C02 emissions.
Moreover, renewed interest in nuclear power is unsurprising as it is the only source that meets the threefold challenge of climate change, security of supply and competitiveness, he explains, calling for discussions on nuclear to take place in the Council.
Herzog believes a single energy market should “encourage the spread of safe, competitive technologies”. Nuclear power should be at the forefront of this, he adds.
Politicians must create conditions for “the social acceptability of nuclear power” and “end the divergences in national support systems for renewable energies”, which run “contrary to the notion of a single, efficient market”, Herzog states.
The Commission’s emphasis on ‘ownership unbundling’ of the electricity market is “fraught with dangers” as the EU executive has “totally failed to assess the economic and financial effects”, he says.
Its unbundling plan “totally ignores the hostility” of populations and several states to investments in cross-border hubs, believes Herzog. Moreover, investors say establishing an EU regulatory framework is “much more important than ownership unbundling”, he claims.
European gas is supplied mainly from outside the EU, thus “internal regulation of the gas market is impossible without an external energy policy and internal solidarity”. The European grid must focus on allowing “competition among external suppliers rather than risking increased dependency on Russian gas”, Herzog says.
Meanwhile, Russia “will no more consider adopting European rules than the EU is willing to adopt Russian rules”, he says – yet a mutually acceptable compromise must be found as “our destinies are linked”.
Herzog concludes that “the setting up of European markets is only justifiable if there is a long term ‘energy community’ objective taking on an industrial policy for sustainable development” and serving as a “global force to save the planet from climatic disaster”.
Moreover, the Commission “must be reorganised so that it is responsible for industry, public assets and competition”, involving the appointment of European regulators.