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Power politics - From rhetoric to results on EU energy policy

European Policy Centre

Date: 02/03/2007

Energy policy will rightly be top of the agenda at next week’s EU summit. But there is a real danger that, instead of taking the key decisions which are needed now on the European Commission’s energy package, the Union’s leaders will simply generate a great deal more hot air.

There has been no shortage of political rhetoric on this issue, but Member States have been slow to match their words with deeds. The time has come for them to shoulder their responsibilities. Vague expressions of intent will not be enough: they need to agree on key targets now and spell out in detail how they intend to meet them, by publishing national action plans before the summer. The final package of measures must also include a mandatory element, using a combination of carrots and sticks, if it is to deliver the required results.

The Commission has correctly pointed to the two major challenges facing the Union in this area - security of supply and climate change - and identified energy efficiency as a key priority. But it has focused far less attention on another, broader issue which should be at the cornerstone of all policy developments in this area: namely, the rational use of energy.

A more rational use of existing energy resources would enable the EU to both reduce its dependence on external supplies and cut greenhouse gas emissions. In line with the principles of Better Regulation, it could also become a key driver for innovation, thereby helping the EU to reach the ambitious goals laid down in the Lisbon Agenda.

What is needed now is an EU regulatory framework to encourage more rational use of energy and boost economic growth and jobs by encouraging the development and widespread use of existing and new technologies and a set of robust national plans to ensure an efficient follow-up at Member State level.

To give just one example, setting mandatory energy-efficiency requirements for buildings would provide the necessary incentive for the construction sector to develop new forms of insulation or more energy-efficient heating and air conditioning systems, safe in the knowledge that there will be a market for such products to comply with the new laws and that they will, therefore, get a decent return on their investment.

Some of the objectives set out in the Commission’s energy package are clear and ambitious: improving energy efficiency by 20% by 2020, ensuring that renewables account for 20% of the energy mix by the same date, achieving near-zero emissions from new power plants by 2020 and taking new steps to complete the internal market in energy. However, it remains to be seen whether EU leaders will give a firm commitment to achieve these goals.

The European Policy Centre makes the following recommendations for action at next week’s summit and beyond:

1.   The growing sense of urgency in this area must be translated into action. It is not enough for the Commission and Member States to agree on targets. They must also go through the much more demanding process of getting a detailed agreement on who will do what. The proposed targets will only be credible when it is clear how Member States and different sectors of the economy will deliver what is required of them. This is the indicator against which the success or failure of the Spring European Council should be measured.

2.   The EPC strongly believes that the rational use of energy can contribute greatly to delivering the necessary change of gear. Energy efficiency has correctly been identified by the Commission as a priority. However, too little of the huge existing technical potential identified in numerous studies has been realised. In the longer term, technical innovation will be crucial to provide energy at the global level in a sustainable way. In the short- to medium-term (up to 2020), it is policy innovation that will be crucial to ensure a much better exploitation of existing resources by changing patterns of behaviour in energy use.

3.   EU leaders must acknowledge that, in line with the principles of Better Regulation, the rational use of energy and new initiatives in the field of energy efficiency could be a key driver for growth, jobs and innovation in Europe’s economies, thereby making a significant contribution to achieving the Lisbon targets.

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