Paris Workshop

Nicolas Romeo

Energy: giving Europe Power

Former General Secretary of the European Council Christine Lalumière hints that “Europe needs a vision” to keep going and keep the approval of the European citizens. In its “Europe for citizens Programme”, the European Commission asserts that “the Lisbon agenda has set the following target for the EU: to become the most competitive knowledge based economy in the world.” Why not solve these problems and hit this target with an ambitious energy policy? The Energy policy of the Union is extremely important: In January 2009, when Ukraine, a non-EU country, was stopped being fuelled by Russia, 16 EU countries (plus Moldova) were denied fuel, sparking a humanitarian situation that took nearly a month to solve. The European Union energy flow was put in turmoil due to an unrelated conflict.

The Europe of 2030 cannot afford being so easily put at risk. A 2011 study from Eurostat shows that the EU27 can be considered “54% energy-dependant”(Eurostat); in addition to damage the European trade balance, this dependency has strong implication on a strategic point of view. How can the European market and would-be diplomacy retain its role when energy producing countries with developing industries are rising? The odds of global competition seem to turn against the European Union, especially with the on-going economic and political crisis facing the EU.

The EU didn’t wait to try to plan an energy policy which would help Europe attain a higher energy independence rate, help the economy and give a sustainable vision to the European project. The European Commission on Energy publishes each year the “green paper”: the 2030 framework for climate and energy policies. A quick read of the 2013 edition shows ambitious EU targets on greenhouse gas emissions reductions, energy efficiency, and renewable energy market share in 2020; according to the paper, the Union is on track to meet half of its objectives, hampered by the differences existing between Member States, various difficulties in financing projects, and most importantly the fear of losing industrial competitiveness due to expensive energy costs – According to International Energy Agency data, electricity prices for industry in Europe increased on average by 38% between 2005 and 2012 while they decreased by 4% in the USA.

While Greenpeace may contest that the green paper constitutes a real framework, with some concerns over carbon taxations policies, it does constitute a good start. But even with the best projects, the EU needs some help achieving this vision. Companies and member states are the keys to the fulfillment of this project. And that is where the Europe is not united enough to pursue its objectives properly. The European carbon market, the EU Emission Trading System, is already under scrutiny by NGOs; the existence of a one-of-its-kind carbon market isn’t at the advantage of the EU trade balance against other world economies. The EU needs encouragement to establish risky strategies: a visible change in corporate mentalities might help companies change their stance on the subject and support these policies, without falling for greenwashing, though easier said than done. Only 53 % of Europeans consider companies as helpful to the society (Eurobarometer); political extremes are in part playing on this fear “of the ruthless global investor” to promote protectionism – Europe’s biggest political problem. However effective green technologies might be in the future, let’s not forget that for now green technologies aren’t effective enough to satisfy demand. Before heading to full solar or wind energy, which wouldn’t happen before 2040 to be optimist, Europe Nicolas Romeo 3rd Prize Energy: giving Europe Power 7 still needs power. According to Shell scenarios, it is forecasted that oil and coal are expected to be the dominant forms of energy worldwide for at least 20 more years, the time needed to actually implement renewable energies. The EU is a big enough actor in the world to act on the world’s energy mix. Even though on a climate perspective nuclear technology has many advantages, it is politically too sensitive and too expensive to become the main power source of Europe. From a sustainable development standpoint, in the transition period leading to a shift in energy sources, natural gas would be much better than coal or oil due to a lower emission to energy ratio before research permits green sources to be competitive enough.

In the meantime, cancelling exploration and production of Oil & gas in Europe because of ideological reasons isn’t useful: attaining energy independence and securing provision is as vital as developing new forms of energy, and would actually ease the transition to renewables among obvious strategic advantages for the continent. The Europe of 2030, the Europe of sustainable development will have to understand its responsibility in the world’s power generation, and strive to be able to provide other countries the energy they used to rely on.