NEED Summit of UK and EU Energy ministers agree to promote energy efficiency and affordable prices in 2030 Climate and Energy Framework

Martin Lidegaard, Denmark's Energy Minister
Martin Lidegaard, Denmark’s Energy Minister

Energy Ministers from the UK – together with counterparts and high level government representatives from many other EU nations and the EU Commissioner for Energy – have agreed at a recent high-level summit to ensure energy efficiency and affordable energy pricing mechanisms are included in the 2030 Climate and Energy Framework.

Ministers and delegates from the UK, Belgium, Denmark, Estonia, Finland, Germany, Ireland, Latvia, Lithuania, the Netherlands, Norway, Poland, Sweden, the EU Commission’ Director-General for Energy, the President of the European Network of Transmission System Operators (TSOs) attended the Second Summit of the Northern European Energy Dialogue (NEED) at the Royal Society in London.

Representatives from OFGEM – the UK energy regulator – the energy industry; institutional investors and an independent think tank also attend the NEED summit.

NEED members agreed that Europe must deliver a significant increase in network infrastructure to derive the full benefits of the single market and its three goals: competitiveness, security of supply and sustainability, including the cost-effective integration of low carbon sources of energy.

Recalling the conclusions of the first Northern European Energy Dialogue in Copenhagen, the 2nd NEED Summit reiterated the need for well-functioning market mechanisms and a stable and predictable investment climate to support the financing of energy infrastructure. A liberalised single market in Europe can enable effective investments in network infrastructure.

The London summit welcomed the progress that has been made since the first Northern European Energy Dialogue last year – including the adoption of the Trans-European Networks-Energy (TEN-E) Regulation and the imminent publication of the first EU-wide list of ‘Projects of Common Interest’.Industry sources later told Scottish Energy that ‘this is a major step forward in achieving a more integrated energy market’.

The London NEED summit also welcomed the Commission’s work to deliver early concrete proposals on a 2030 Climate and Energy Framework, for discussion at the March 2014 European Council.

In this context many countries noted that there was an urgent need for the EU and the Member States to provide a clear and stable policy framework – with a reformed EU Emissions Trading System at its heart – to bring forward cost-effective investment, not just in generation but also in the infrastructure that will underpin secure and cost-effective reductions in greenhouse gas emissions. Some countries pointed out that the EU ETS should remain a market based instrument promoting reductions of greenhouse gas emissions in a cost-effective and economically efficient manner as stipulated by the EUETS Directive.

As a result, a number of NEED delegates expressed concern ‘that current debate on the 2030 Climate and Energy Framework does not give due weight to the need for new infrastructure to integrate higher volumes of low carbon generation efficiently and cost-effectively.’ They also emphasised the importance of energy market integration in underpinning the cost-effective delivery of long term energy and climate goals.

Financial investors told Scottish Energy that ‘EU unbundling rules continue to present a barrier to capital deployment in energy infrastructure assets.’

Consequently, NEED agreed that it was important to avoid the unintended consequence of deterring investment in both transmission and generation where there is no risk to competition. NEED also agreed that:

  • The development of the 2030 Climate and Energy Framework should reflect the need for market integration and network delivery to facilitate the deployment of new low carbon generation – alongside demand side response and energy efficiency while maintaining affordable energy prices;
  • Welcomed agreement on the TEN-E regulation, and urged the relevant EU bodies and national Governments to work together with TSOs, regulators, industry and other market participants to prioritise delivery of Projects of Common Interest:
  • EU Member States should reiterate their commitment to full implementation of the TEN-E regulation, including all the necessary steps to be taken in our national administrative requirements and procedures, and
  • Expressed strong support for the work of regional inter-governmental groups (such as NSCOGI, BEMIP, NSI-East or the Pentalateral Energy Forum) in facilitating the infrastructure investment required to meet our future energy challenges. The regional groups should co-operate closely with ENTSO-E to inform its Ten Year Network Development Plans.

Martin Lidegaard, Denmark’s Minister for Energy, will formally report the Conclusions of the 2nd NEED summit at the Lithuanian Presidency Event on Energy infrastructure on 4-5 November, 2013

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