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EU Consultation on Energy Networks - Draft Response

by nanne Mon Mar 30th, 2009 at 02:12:43 AM EST

Better energy networks are an important part of a more sustainable future. They can enable a greater share of renewables, and more decentralised energy production. Last November, the European Union started a public consultation on energy networks. DoDo flagged this in a debate on eurotrib, and DoDo and I wrote some initial responses for the consultation.

You'll find a consolidated response after the jump, which was drafted by DoDo and edited by me. Please give us your feedback. We will have to submit our response by March 31st. That is, next Tuesday.

As a guide, the draft response first gives a general response and then answers the 11 questions in the consultation.

Bumped by afew


Some background documents for the consultation:

The Commission's Energy Network Green Paper (pdf)
The EU's Strategic Energy Review
The EU's Energy Policy for Europe

The questions in the consultation are as follows:

Network Policy

  1. What do you consider to be the main barriers to the development of a European grid and gas network? How far can they be addressed at national/regional level, and when should the EU act?
  2. What circumstances justify an EU intervention in local planning disputes related to energy infrastructure? In those circumstances, what should the EU do?
  3. Is a more focussed and structured approach to research and demonstration relating to European networks needed? How should it look?
  4. What do you think is the most important activity for the EU in network development?
  5. Should the EU be more involved in facilitating infrastructure projects in third countries? If so, in what way?

    TEN-E

  6. What sort of support should the EU provide to developers of new energy networks to have the greatest impact, considering that resources are limited? Is the approach of TEN-E still relevant? How can the EU help improve the conditions for investment?
  7. In view of the proposed revision to the TEN-E guidelines, how can the EU improve the focus, effectiveness and impact of the TEN-E policy within its existing budget?
  8. Should TEN-E be extended to oil infrastructure? Should it also be extended to new networks for CO2, biogas or other networks?
  9. Do you have views on, or suggestions for new priority projects which the EU should give backing to?
  10. Would it help TEN-E/EU to gain more impact and visibility if it was turned into an operational security of supply and solidarity instrument?
  11. What additional EU measures beyond those mentioned in this Green Paper would help secure a sustainable infrastructure for the EU?

As a meta-note, I'm off for today. The tip jar belongs to DoDo.

--- start of response ---


European Tribune contribution to the Public consultation on the Green Paper
"Towards a Secure, Sustainable and Competitive European Energy Network"


1. General

We welcome the Commission's realisation that the European Union has to take a pro-active approach to energy networks. However, we believe that a more explicit recognition of the role of public authorities is needed for the EU to fulfil its policy goals.

1.1 Competition

One of the main aims of EU energy policy was to get "competitiveness" by setting up an undistorted market, in the hope that the "market will deliver" certain desired improvements; coupled with adjustments and incentives where the market didn't deliver. In its Communication on energy policy, the Commission writes the following:

An internal energy market has been developed on a Community level to ensure that consumers have the opportunity to choose a supplier, at a fair and competitive price. Nevertheless, as highlighted by the Communication on prospects for the internal energy market and the inquiry into competition in the gas and electricity sectors, there are obstacles which continue to prevent both the economy and European consumers from fully benefiting from the advantages of opening up the gas and electricity markets. Ensuring the effective implementation of the internal energy market thus remains crucial.

This view seems compelling, until one thinks about what "competition" really means. "Competition" is not a self-contained notion, it doesn't occur in a vacuum.

If we think of sports and games, we recognise that a competition is defined by its rules. If rules are changed, it's a different game, in which people with different abilities will be successful, using different strategies. If we think of biology, we recognise that the fitness of competitors is defined by the environment, that is, how well adapted they are to a specific niche at a given time.

The same picture applies in the economy. Competitiveness is not an absolute, nor an inherent trait of a market. It is relative and relates to the players that exist within a given market. Markets themselves don't exist in a vacuum. There is a broader social environment that sets the framework for a market. Norms and rules are key elements of this framework. This implies that one of the driving forces of a market is regulation.

1.2 The aim of regulations

The role of energy market regulations also means that the bodies responsible for regulation need to have primacy in setting energy policy.

Setting up rules merely with a view to establish a mistaken sense of 'undistorted' competition, or to 'enhance competition', or to cater to the wishes of market players, is not a conscious energy policy worth its name, but an abdication of the power to set energy policy consciously.

If public authorities have specific energy policy goals -- be they sustainability, security of supply, long-term investment in networks, or lower prices --, then they shouldn't wait for private companies to step up, and think of extra incentives as supplement, but think of setting up markets where players striving towards those goals thrive and those with different aims don't.

As indicated in the Green Paper, EU energy policy emphasizes the creation of a stable regulatory framework. Such stability might serve an aim to stimulate long-term investments. However, it is not the sole possible regulatory factor for such investment, and market players' appeals for stability shouldn't block sweeping changes when these are needed to fulfil the goals of EU energy policy.

1.3 Unbundling

The competitiveness of an energy producer is influenced by many factors regulators may set, such as: start-up costs vs. fuel costs, the financial conditions for start-up costs (interests, length of repayment period, depreciation, the discount rate, guarantees), price stability, taxes, geography, zoning laws, grid access rules; and the level to which certain costs are externalised, such as pollution, or access to and compatibility with existing infrastructure.

Focusing on energy networks, EU energy policy foresees an unbundling of networks and producers, with the aim of creating an 'undistorted market' between producers. However, this policy takes too narrow a view of the issue at hand.

On the one hand, if the real intent is, for example, to promote new producers of renewable energy, it would be better to drop the illusion of the 'undistorted market' and facilitate grid access and integration with more explicit regulation.

On the other hand, networks and production aren't independent. For security of supply to end customers, one needs both proper networks and proper load management -- and the two are interrelated. Producers (and colluding energy authorities) can keep grid efficiency low (and bar access to newcomers) through bad load management.

1.4 Beyond markets

It is a fundamental mistake to assume that if only a project would be profitable, there will be investors.

There is a general conflict between security of supply and long-term investments on one hand, and profitability for companies and low prices for customers on the other hand. Security of supply requires redundancies, long-term investments need long periods of time; while profitability calls for cost-cutting, including the elimination of idle capacity.

This fundamental conflict can be mitigated by measures like setting explicit requirements on investments and redundancies, or setting minimum prices. Alternatively, public authorities may take a more direct approach.

The primacy of public authorities over energy policy also involves the decision over what parts of the energy economy are to be turned into a market. Thus, it should not be beyond the scope of EU energy policy to consider the maintenance of the ownership and operation of energy grids in the public hand, or the construction and operation of certain load balancing plants.

Even in such a case, though, the interest of players on marketised parts of the energy economy in off-loading certain costs on the public-owned part should be considered. This particular problem of externalities also exists during a marketisation process.


2. Network policy

2.1 Barriers to development

The main barrier to the development of a European grid is the lack of a strong and well-financed public initiative on the basis of long-term plans. Energy policy should not follow developments, it should define them. For example, TEN-E should not be market-driven: rather, energy policy should drive markets. Neither regional, nor national, nor EU-level policy should be dependent on advice and solutions from established utilities.

The EU should act directly on cross-border lines, and get involved in setting goals for national and regional policies, in particular in line with the 20-20-20 objectives.

For example, in Hungary, the energy authority capped the total capacity of renewables under a feed-in law at a very low level, because ostensibly the grid won't sustain a higher grid penetration. The EU could and should counter-act such decisions by bringing in the best load management experience and expertise from other Member States (like Denmark) to perform an independent audit. It may also be necessary to pursue new EU regulations to make local energy authorities' cooperation on such advice a requirement.

In its interventions to achieve the 20-20-20 objectives, the EU should be fully aware that established producers stand to lose market share. The EU should be willing to face eventual confrontations.

2.2 Intervention in local disputes

Local planning disputes can become a matter for EU policy when EU policies that have direct relevance towards planning are affected, e.g. Natura 2000, the Directives on environmental impact assessment, the 20-20-20 targets, or future regulations as suggested in 2.1; or if the planning dispute has a cross-border element and relates to a TEN-E project. Local planning disputes are otherwise an issue for the national government to work out. It has to be kept clear that these disputes are not legitimate grounds for failure by national governments to meet EU targets such as a national renewable energy target.

When a local planning dispute threatens to delay a TEN-E project, the EU Commission should put pressure on the national government and try to clarify the project to local communities. The energy coordinator mentioned in the green paper may be a good model.

The EU should spend much more effort to prevent local planning disputes by linking up impact assessments to involve local communities at an early stage in TEN projects. To that end, more funds should be allocated for impact assessment in DG TREN.

2.3 More focused & structured approach to research and demonstration

Research and demonstration projects should be targeted specifically towards the operation of a European electricity grid with a high share of renewable energy. This implies directing funds primarily towards storage, load management, local generation and changes to the electricity grid.

2.4 Top priority in network development

The immediate top priority for the EU is rapid expansion of the TEN-E network through co-funding. Priority should be given to electricity networks. Funding for TEN should be enlarged through an increase in the general budget of the EU, shifting funds within the EU budget away from agriculture and fisheries, and utilising money left over in the budget.

At policy development level, the top priority should be given to a complete re-focusing of regulatory and funding measures on projects that work towards, or beyond, the 20-20-20 targets.

"Competitiveness", without qualifications as to what this competitiveness should accomplish, is not a sensible goal for network development.

2.5 Facilitating projects in third countries

Facilitating projects in third countries runs counter to the objective of energy independence, and improves energy security little when supplies are tight globally and there is no interlinked consideration of demand.

If, as the Green Paper states, energy imports are set to rise under almost all scenarios, then the EU should aim its limited resources at making one of the few other scenarios true, rather than further facilitating import dependence. For example, the gas supply security of Central and Southeastern Europe would be better served by a larger-scale building insulation programme, even without added gas storage capacity, than new multi-billion-Euro pipelines to supplies with questionable capacity. This would also further the EU's 20-20-20 goals on climate change.

Thus, even in cases when the EU's involvement is requested by Member States, priority should be given to electricity networks that transport renewable energy, as in the DESERTEC concept, over gas and oil infrastructure.


3. TEN-E

3.1 How to have the greatest impact

If the EU's own resources are limited, the most effective approach would not be support to developers, but some sort of requirement to develop networks (utilities forced to spend from their own resources or some form of tax).

3.2 Improved focus, effectiveness and impact of TEN-E policy within the existing budget

The EU should drop the limitation of wanting only market-driven TEN-E planning (planned revision No. 3).

3.3 Extension of TEN-E to oil infrastructure, CO2 sequesteration and other new networks

On oil, the EU should not waste its limited resources on facilitating further import dependence. The EU should attack this issue on the demand side.

The development of CO2 sequestration infrastructure and other new infrastructure should not be supported by TEN-E. The EU needs to focus its resources on the electricity network, with a view to enlarging the capacity for renewable energy. In this area, the EU can make an important and proven contribution.

New networks should be monitored and studied. There is also a role for the EU in the area of research. However, a European contribution to new network infrastructure only becomes relevant once such networks, and the facilities they serve, are actually developing, and a need for European coordination thereby arises.

3.4 Priority projects

Priority should be given to electicity grid projects.

Of those possible priority projects listed in the Green Paper, we see no need for EU support for a Southern Gas Corridor or LNG. In the gas sector, too, the EU should attack the issue on the demand side, rather than facilitate further import dependence.

Specifically, the focus on Nabucco as a potential alternative to Russian gas makes no sense, given that the only credible supplier of gas for the pipeline in the requisite volumes (a key requirement to get it financed) is Russia.

On the short term, without increasing import dependence, the worries about over-dependency on Russian gas in Central and South-Eastern Europe could be met by building extra storage capacity, and connections to these countries from Western Europe (so that countries that do have access to North Sea and other suppliers can help those that don't). However, there is no need to make this a priority, and in the long term, again, the best policy would be to help these countries move as much as possible away from gas as a primary source of energy (via energy efficiency and the development of renewables).

3.5 Boosting TEN-E impact and visibility by making it an operational security of supply and solidarity instrument

TEN-E needs to be reformed alongside the stated goals, but what matters is content, not re-branding. If the policies that are set deviate strongly from what the public wants -- be it the EU-wide public or the local public in areas affacted by the new projects -- it may even generate negative publicity for the EU.

3.6 Additional measures beyond those mentioned in the Green Paper

We reiterate that the EU should

  • consider the issue of load management in parallel with grid development, and even on existing grids, and establish the means to facilitate the relaying of good experience (in particular on the integration of renewables with high grid penetration);

  • consider regulatory measures at the level of requirements on market players, one priority being a requirement for grid operators to provide grid access to renewable energy;

  • consider redirecting funds from other fields to TEN-E projects.

Display:
This is an excellent submission. I'm sorry I haven't been able to contribute to this process, but you've really done a great job.

In the long run, we're all dead. John Maynard Keynes
by Jerome a Paris (etg@eurotrib.com) on Sat Mar 28th, 2009 at 09:52:03 AM EST
Seconded.

Be nice to America. Or we'll bring democracy to your country.
by Drew J Jones (pedobear@pennstatefootball.com) on Sat Mar 28th, 2009 at 10:49:37 AM EST
[ Parent ]
a thing of beauty...well done dodo and nanne!

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty
by melo (melometa4(at)gmail.com) on Sat Mar 28th, 2009 at 10:59:10 AM EST
[ Parent ]
Could you contribute a consise but more explicit rubbishing of Nabucco (Southern Gas Corridor, point 3.4)?

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Sun Mar 29th, 2009 at 05:09:59 AM EST
[ Parent ]

The focus on Nabucco as a potential alternative to Russian gas makes no sense given that the only credible supplier of gas for the pipeline in the requisite volumes (a key requirement to get it financed) is Russia.

Worries about over-dependency on Russian gas in Central and Eastern Europe would best be met in the short term by building connections to these countries from Western Europe (so that countries that do have access to other suppliers can help those that don't) and in the long term by helping these countries move as much as possible away from gas as a primary source of energy (via energy efficiency and the development of renewables).



In the long run, we're all dead. John Maynard Keynes
by Jerome a Paris (etg@eurotrib.com) on Sun Mar 29th, 2009 at 06:54:23 AM EST
[ Parent ]
I have problems the second paragraph (see my re-worked version in the edited draft in diary). On one hand, the Green Paper lists the "Southern Gas Corridor" as a prority project, and even if needed, do you think new (or bi-directionalised?) East-West gas connections should be such? On the other hand, do you think there is a real need here -- that is, aren't gas reserves sufficient even when Ukraine and Russland have a longer spat?

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Sun Mar 29th, 2009 at 11:16:45 AM EST
[ Parent ]
New pipelines from West to East can be argued for even if we move away from gas - there will be a minimum level of consumption (for households and industry, even if not for power generation) that requires security of supply.

Your addition about storage is useful.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Sun Mar 29th, 2009 at 12:10:27 PM EST
[ Parent ]
Great work!

You can't be me, I'm taken
by Sven Triloqvist on Sat Mar 28th, 2009 at 11:32:22 AM EST
Excellent work.

A market is defined by the contracts entered into within it, IMHO, and it takes place within a legal and financial framework I call an enterprise model.

The problem is not so much markets per se, but markets run "for profit".

My case has been for some 8 years that we have been lacking a satisfactory "Not for Loss" enterprise model for utilities such as grid infrastructure.

So I would advocate a grid "owned" by a custodian; operated by a service provider consortium; with the costs shared proportionally among users; and with any capital necessary coming from selling the revenues forward through "unitisation"..

The outcome is infrastructure operating "Not for Loss" essentially as a cooperative of cooperatives.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Sat Mar 28th, 2009 at 12:45:26 PM EST
A market is defined by the contracts entered into within it, IMHO, and it takes place within a legal and financial framework I call an enterprise model.

For contracts, you need contractors, and some performance delivered. Those are defined before the contracts. As part of a market, you also need to have contractors in competition. Thus, methinks, the contracts only define the actual state of the market, not the market itself.

So I would advocate a grid "owned" by a custodian; operated by a service provider consortium; with the costs shared proportionally among users; and with any capital necessary coming from selling the revenues forward through "unitisation".

I, too, would be more comfortable with a public-held grid. But most points we raise are also valid if that is not the case, so I think it would be hard to fit it in.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Sun Mar 29th, 2009 at 11:01:58 AM EST
[ Parent ]
DoDo:
For contracts, you need contractors, and some performance delivered. Those are defined before the contracts. As part of a market, you also need to have contractors in competition. Thus, methinks, the contracts only define the actual state of the market, not the market itself.

The electricity market is defined by the electricty contracts which are concluded/transacted and settled in it. A market as I see it is a set of legal protocols which connects the market participants legally  in respect of exchanges of value ie typically transactions of electricity in exchange for money.

At present the market participants consist of producers, consumers and intermediaries, and they operate within statutory frameworks both national and Europe wide which are imposed top down.

Existing market relationships are adversarial and competitive - typically because shareholders of intermediaries aim to extract profits at the expense of producers, consumers and other intermediaries.

I believe that the market outcomes of a statutory framework, and the adversarial contracts between producers, consumers and intermediaries, will be improved by evolving this framework into a cooperative market framework through the use of a partnershipframework agreement and generic transaction registration.

In other words, producers, consumers and intermediaries alike would be members of a European Energy Trade Association with exclusive use of a European Energy Transaction Registry.

A related suggestion (concerning the need for oil market transaction registration) went down pretty well last year at the UK Treasury Select Committee when I gave evidence, and in fact Hernando de Soto is advocating something very similar in relation to derivatives..

Hernando de Soto Says Toxic Assets Emerged From a Shadow Economy - WSJ.com

To bring derivatives under the rule of law, governments should ensure that they conform to six longstanding procedures that guarantee the value and legitimacy of any kind of paper purporting to represent an asset:

- All documents and the assets and transactions they represent or are derived from must be recorded in publicly accessible registries.

In this way, we are able not only to define the market but to create a mechanism available for enforcement of market standards.

Such a European Energy Trade Association is essentially a cooperative of all users of a monopoly market - a meta-exchange if you like - which comprises all transactions however concluded, and however settled. A useful metaphor is to view the market as a universe, with the various exchanges as solar systems.

A consortium of service providers would create and operate on a Not for Loss basis the infrastructure which is necessary. Because the wishes of intermediaries are no longer paramount, it is more likely that the necessary long term strategic investments will be made, and that the market will operate in the interests of the public, rather than those of private investors.

Any necessary investment would come from direct Peer to Peer investment in market revenues (ie future user fees) or even, in due course, from the forward sale of energy itself. ie an Energy Pool. But let's not frighten the horses, eh?

The point is that there now is, I believe, an optimal legal and financial model for utility infrastructure. It consists of the Capital Partnership I first identified some 8 years ago in the context of what I called a Market Corporation, and is based upon what is essentially a Market Operating System aka a Transaction registry.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Sun Mar 29th, 2009 at 12:58:48 PM EST
[ Parent ]
Here is an extra observation not included in the draft. The Baltic Interconnection Plan is one of the proposed priority projects (point 4, pages 13-14). They write:

...Together with the Member States concerned, the Commission will develop this Plan as part of a Baltic Sea Regional Strategy, covering gas, electricity (including offshore wind and potentially tidal power) and storage. This will bring together existing projects into a cohesive system benefiting the whole region. The efficient development of the market as well as the contribution of energy efficiency and renewables to increased security of supply will need to be duly taken into account in developing the Plan.

I smell fish. On the surface, all things to like: integration and new interconnections, security of supply, energy efficiency and renewables.

But, on one hand, if they mention gas, all I can think of is Nord Stream (the St. Petersburg-Greifswald pipeline pursued by Gazprom and its partners in Germany).

On the other hand, regarding a power line that could also be part of the Baltic Interconnection, the Polish-Lithuanian Power Link, the Green Paper has this earlier (first box in point 2.4, page 6):

The link could have dual benefits for security of supply in the region, bridging the gap between the network of the three Baltic States and the rest of the EU, as well as opening up the possibilities for power exports from the planned nuclear plant in Lithuania.

Facilitating exports of surplus capacity from a planned plant would improve that plant's profit expectations, and would thus constitute an indirect but quite material influence on the choice of generating modes in Lithuania. One for which the Commission has no mandate for I am aware of -- while it does have a mandate for favouring renewables.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Sun Mar 29th, 2009 at 05:08:38 AM EST
It does make sense to connect the Baltics directly to the EU grid, even if the potential result is to help their nuclear plant project. I suspect that nuclear plant has enough problems that this will not be enough to help it come alive, whereas the connexion is actually good for energy security, and can easily help with offshore wind.

In the long run, we're all dead. John Maynard Keynes
by Jerome a Paris (etg@eurotrib.com) on Sun Mar 29th, 2009 at 06:56:36 AM EST
[ Parent ]
I do agree that interconnection makes sense, in the light of what you say and what the justification in point 4 says, but I feel they are weasely in the wording.

I suspect that nuclear plant has enough problems that this will not be enough to help it come alive

Incidentally, just the other day, I read a negative analysis of the Hungarian government's new plan of adding two blocks to the Paks nuclear plant, from unexpected quarters: a purely financial analysis, focusing on financing costs.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Sun Mar 29th, 2009 at 07:36:45 AM EST
[ Parent ]
That's the constant mortal threat to nuclear investments - if financing costs go up, the entire business breaks down.

And with the current situation, even bonds backed by the full faith and credit of Budapest should carry pretty high interest.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Sun Mar 29th, 2009 at 11:34:54 AM EST
[ Parent ]
Setting up rules merely with view

better (I think)

Setting up rules merely with a (or the) view

energy policy goals -- be them sustainability
better (I think)

energy policy goals -- be they sustainability

the Communication on prospects for the

(German capitalisation problems...) (-:

the communication on prospects for the

It is a fundamental mistake to assume that if only a project would be profitable, there will be investors.

A fundamental mistake is to assume: Only a profitable project attracts investors.

I don't know enough about California and the blackouts due to Enron and Energy de-regulation - but could that be a suitable warning to use as an example? (I like that you have mainly provided European examples)

Good work Nanne and DoDO!!!

by PeWi on Sun Mar 29th, 2009 at 08:44:47 AM EST
Thanks PeWi, we need this.

On Communication, it is habitual in EU jargon to capitalise official EU documents and institutions.

The sentence with the 'mistake' isn't the prettiest, but I don't know if it contains grammatical errors. I'd reformulate it as 'It is a fundamental mistake to assume that profitability will automatically attract investors to a project'.

Though I do not know what the precise meaning of the sentence should be.

Perhaps it is better to write 'It is a fundamental mistake to assume that profitability should drive infrastructure investments'.

by nanne (zwaerdenmaecker@gmail.com) on Sun Mar 29th, 2009 at 09:01:05 AM EST
[ Parent ]
No, that's not the meaining I intended :-) I tried to allude to this part in the Green Paper's intro:

It has always been assumed that energy networks would be self-financing. To achieve this a clear and stable legal framework is the main precondition for stimulating private sector investment in generation and transmission/transport...

I.e., I meant to say that the market won't deliver just because a project would be self-financing.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Sun Mar 29th, 2009 at 10:39:51 AM EST
[ Parent ]
I can't think of a good formulation, though... can someone help?

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Sun Mar 29th, 2009 at 10:46:47 AM EST
[ Parent ]
It is a fundamental mistake to assume that if only a project would be profitable, there will be investors.

It is a fundamental mistake to assume that the market will always provide the capital for any project with a positive return.

Is that your meaning?

by Sassafras on Mon Mar 30th, 2009 at 11:48:25 AM EST
[ Parent ]
Yes! But, I would like to tweak it some more -- is the following version clear enough and good English?

"It is a fundamental mistake to assume that some investors will always be willing to provide the capital for any project with a positive return."

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Mon Mar 30th, 2009 at 12:25:59 PM EST
[ Parent ]
The use of "some" in English can be quite tricky, now that I think about it.

If some investors will not always be willing, then there is an implied second group of investors-the remainder-and what is their view? The uncertainty detracts from the clarity and force of your point.

Fixing it could be as simple as dropping the "some":

It is a fundamental mistake to assume that investors will always be willing to provide the capital for any project with a positive rate of return.

Or (which might or might not be closer to your original meaning):

It is a fundamental mistake to assume that an investor can always be found to provide the capital for any project with a positive rate of return.

??

by Sassafras on Mon Mar 30th, 2009 at 01:52:05 PM EST
[ Parent ]
On re-reading, I don't like "can be found".  There's a possible confusion between the literal and idiomatic meanings, and the ambiguity makes for an ugly sentence.  Sorry.

It is a fundamental mistake to assume that any project with a positive rate of return will be able to attract investment.

??

by Sassafras on Mon Mar 30th, 2009 at 02:07:35 PM EST
[ Parent ]
...or...sufficient investment, perhaps?
by Sassafras on Mon Mar 30th, 2009 at 02:09:39 PM EST
[ Parent ]
It is a fundamental mistake to assume that any project with a positive rate of return will always be able to attract investment.

?

by Sassafras on Mon Mar 30th, 2009 at 02:13:13 PM EST
[ Parent ]
Better already. What do you think about deleting 'any' and writing 'projects'? Or just replacing 'any' with 'a'?

It is a fundamental mistake to assume that a project with a positive rate of return will always be able to attract investment.

It is a fundamental mistake to assume that projects with a positive rate of return will always be able to attract investment.

I like the second one better...

by nanne (zwaerdenmaecker@gmail.com) on Mon Mar 30th, 2009 at 03:04:39 PM EST
[ Parent ]
So do I.

I might be tempted, though, to insert "private sector", in order to make it really clear:

It is a fundamental mistake to assume that projects with a positive rate of return will always be able to attract private sector investment.

?

by Sassafras on Mon Mar 30th, 2009 at 03:21:09 PM EST
[ Parent ]
I'm your private sector, a sector for money...
by nanne (zwaerdenmaecker@gmail.com) on Mon Mar 30th, 2009 at 03:25:30 PM EST
[ Parent ]
It is a fundamental mistake to assume that a positive rate of return is always a sufficient condition for a project to attract investment.

?

"3.3 Extension of TEN-E to oil infrastructure, CO2 sequesteration and other new networks"

sequestration

"Thus, it should not be beyond the scope of EU energy policy to consider the maintenance of the ownership and operation of energy grids in the public hand, or the construction and operation of certain load balancing plants."

Thus, it should not be beyond the scope of EU energy policy to consider maintaining the ownership and operation of energy grids, or the construction and operation of certain load balancing plants, in the public hand.

That's all I can think of.

It's really excellent, congrats, you guys!

by afew (afew(a in a circle)eurotrib_dot_com) on Mon Mar 30th, 2009 at 04:27:55 PM EST
[ Parent ]
be them sustainability

That's a mistake I was scolded for before, by afew and Colman, but one apparently hard to un-learn...

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Sun Mar 29th, 2009 at 10:42:35 AM EST
[ Parent ]
3.3 Extension of TEN-E to oil infrastructure

The EU should not waste its limited resources on facilitating further import dependence. The EU should attack this issue on the demand side.


Addition:

The development of CO2 sequestration infrastructure and other new infrastructure should not be supported by TEN-E. The EU needs to focus its resources on the electricity network with a view to enlarging the capacity for renewable energy. In this area, the EU can make an important and proven contribution. New networks should be monitored and studied. There is also a role for the EU in the area of research. A European contribution to new network infrastructure only becomes relevant once such networks are actually developing and a need for European coordination thereby arises.

by nanne (zwaerdenmaecker@gmail.com) on Sun Mar 29th, 2009 at 09:39:52 AM EST
I will now start to try to integrate all the new suggestions in the diary.

If, hopefully, the text is ready tomorrow, it should be converted into a formatted Word (or other) document, and then into pdf. In this, I hope afew can help -- best would be to use the same format and styling as for his biofuels consultation.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Sun Mar 29th, 2009 at 10:35:59 AM EST
[ Parent ]
I didn't do the pdf... And don't recall how it got formatted exactly. I think Nomad did the last bit.
by afew (afew(a in a circle)eurotrib_dot_com) on Mon Mar 30th, 2009 at 04:32:39 PM EST
[ Parent ]
But I've got the Word document, and the pdf formatting appears identical. Shall I e-mail it to either or both of you?

A point to be considered is whether we announce it as the contribution of European Tribune. I'd say yes, since they recognized us in the ONG section on the Biofuels Consultation. So the header of my .doc, giving my name as a citizen consultee, might not need to be done that way: it could just say European Tribune?

by afew (afew(a in a circle)eurotrib_dot_com) on Mon Mar 30th, 2009 at 04:42:47 PM EST
[ Parent ]
E-mails sent.
by afew (afew(a in a circle)eurotrib_dot_com) on Mon Mar 30th, 2009 at 04:48:32 PM EST
[ Parent ]
Beyond slight format changes, I added "only becomes relevant once such networks, and the facilities they serve, are actually developing". Thinking that CO2 sequestration exists mostly on paper.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Sun Mar 29th, 2009 at 10:52:02 AM EST
[ Parent ]
Considering that trees have been sequestrating carbon since whenever, putting the facts on paper would seem to make matters worse ;-)

You can't be me, I'm taken
by Sven Triloqvist on Sun Mar 29th, 2009 at 10:59:28 AM EST
[ Parent ]
Well, the EU has Natura 2000 for that. There's a lot to be improved there

(though I do think the link to the climate change issue is a line that needs to be treaded very carefully)

by nanne (zwaerdenmaecker@gmail.com) on Sun Mar 29th, 2009 at 11:09:31 AM EST
[ Parent ]
I'm finished with the edits, except for that profitable projects and non-forthcoming investors sentence. Is is it fine that way?

Can we add anything to 3.1 and 3.2?

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Sun Mar 29th, 2009 at 11:19:18 AM EST
[ Parent ]
Well, if I'm allowed to be repetitive, I'd say:

3.1

[deleted the first 'own' because 'own resources' of the EU has a specific meaning in EU jargon]

If the EU's resources are limited, the most effective approach would not be support to developers, but some sort of requirement to develop networks (utilities forced to spend from their own resources or some form of tax). The TEN-E approach needs to be focused further in two respects. First, the projects need to be determined by the Member States in close coordination with the Commission and under clear reference to EU policy goals. Second, the resources need to focus on improvements to the electricity grid, and further on projects that are especially promising for the spread of renewable energy.

3.2

The EU should drop the limitation of wanting only market-driven TEN-E planning (planned revision No. 3). The level of funding for TEN-E is inadequate, but the EU could still allocate the resources with a greater impact if it focused more clearly on the electricity network and left desired expansion of the gas network to the Member States and regulatory requirements for storage and solidarity.

by nanne (zwaerdenmaecker@gmail.com) on Mon Mar 30th, 2009 at 03:01:19 PM EST
[ Parent ]
I don't see anything in here about the relationship between water and energy networks. It might not be obvious at first glance, but there is a very close relationship between the two, because most forms of power distribution require substantial amounts of water (mainly for the cooling system in a coal, oil, or nuclear plant), while the development of water resources may require substantial energy inputs for pumping, desalination, etc. About 40% of U.S. fresh water is used for power plant cooling and other energy-related items--with most of that being returned to the supply system, but the point is you need the water in the first place.
http://www.netl.doe.gov/technologies/coalpower/ewr/water/power-gen.html

Over on this side of the pond there is considerable concern that decisions about these two resources are being made in separate forums by separate players...not that we're doing anything besides just worrying about it...

by asdf on Sun Mar 29th, 2009 at 01:16:46 PM EST
Well, unlike in the US, there is no dry place in Europe which is far from the sea, so this isn't really a problem.

Peak oil is not an energy crisis. It is a liquid fuel crisis.
by Starvid on Sun Mar 29th, 2009 at 01:47:28 PM EST
[ Parent ]
Yes, that's true--assuming that all thermal power plants are built on coastlines and cooled with seawater, and that the environmental effects of local heating of the water are acceptable. However, current plants aren't built by the sea, they're built near the consumers, so when you get a drought then the power supply drops off. This happened in 2006, for example.

The point is that the siting of power plants has a big effect on the distribution network...

by asdf on Mon Mar 30th, 2009 at 08:37:20 AM EST
[ Parent ]
All our powerplants are built on the coast, at least the big thermal ones. The small thermal ones are heat or cogen plants and are built in the cities and towns, but in a hot climate they are obviously not needed in the same way.

I can also add that the consumers are far more often near the coast in Europe compared to the US. After all, why would anyone like to live far from water?

When it comes to heating sea water, that's not problem at all, at least not in the cool Baltic sea. Not far from my home we dump aout 6000 MW thermal into the sea. To see how it would affect the environment, we started a research project when the plants was built, the world unique so called Biotestsjön, the Bio Test Lake.

No negative effects have been found, though the metabolism of the fish is sped up.

   

   

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Mon Mar 30th, 2009 at 09:49:10 AM EST
[ Parent ]
All our powerplants are built on the coast, at least the big thermal ones.

Are you speaking about Sweden? Because for much of Europe, this aint' true.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Mon Mar 30th, 2009 at 12:27:40 PM EST
[ Parent ]
Same in Finland.

You can't be me, I'm taken
by Sven Triloqvist on Mon Mar 30th, 2009 at 12:28:27 PM EST
[ Parent ]


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