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SPECIAL FOCUS - European Energy Strategy
by Fran on Thu Jan 11th, 2007 at 12:11:48 AM EST
Spiegel Online: EU UNVEILS ENERGY STRATEGY - Brussels Bows to Global Warming

Arid deserts in Spain, winters with no snow and fewer tourists in the Mediterranean. All that will happen if the world doesn't act, the EU said on Wednesday. Its new energy strategy plans emission cuts of up to 20 percent.

The climate change report issued by the European Commission on Wednesday is uncompromising. Should average temperatures in Europe climb more than 2 degrees Celsius, eco-systems will be devastated, the continent's agriculture will radically change, its wildlife will be destroyed and tens of thousands of people will die.

Many of our habits may also change according to the study: Summer holidays on the Mediterranean may no longer be possible due to the heat, and ski trips to the Alps may suffer from a lack of snow. The report says that harvests in southern Europe could shrink by as much as 20 percent as droughts become more common. Agriculture in Scandinavian countries, on the other hand, could stand to benefit.

The study comes as part of the EU's release on Wednesday of a comprehensive new energy policy focusing on renewable fuels, cutting energy consumption and reducing the 27-nation bloc's dependence on oil and gas suppliers abroad. Indeed, the announcements could hardly be more timely, with a number of Central European countries including Germany hit by Russia's decision to temporarily shut off a major oil pipeline this week -- and with temperatures across Europe unusually warm this week. German Chancellor Angela Merkel, who just took over the rotating European Union presidency at the beginning of the month, has said that energy and climate change would be priorities.

"Climate change is among the gravest environmental, social and economic challenges facing mankind, and it is already happening," read a statement on the European Commission Web site. "Urgent action is needed to limit climate change to a manageable level and prevent serious physical and economic damage."


by Fran on Thu Jan 11th, 2007 at 12:14:43 AM EST
[ Parent ]
Deutsche Welle: EU Unveils Major New Energy Policy

The European Commission unveiled sweeping plans Wednesday to diversify EU energy sources, slash carbon emissions by 20 percent and enforce rules for fuel competition.

The commission presented the plan as the gateway to a "post industrial revolution" amid deep concern over the reliability of supplies from Russia, breaches of EU energy principles by member governments and global warming.

After recent oil spikes and tensions with Russia over its gas and oil shipments and signs that some EU governments prefer national policies, EU Commission President Jose Barroso called on the 27-nation bloc to "face new realities" with coherent EU action.

"Europe must lead the world into a new, or maybe one should say, post industrial revolution -- the development of a low carbon economy," he told journalists. "We have already left behind our coal-based industrial past, it is time to embrace our low carbon future."
 ----
The commission's proposals hold that a delicate overall balance in energy policy can be achieved with firm commitments to limit greenhouse gas emissions up to 2020 and to lift the use of renewable energy sources.

At the same time, big integrated energy groups could be required to "unbundle" some of their activities, such as splitting off power grids, to avoid conflicts of interests and fuel new competition in markets the commission finds too cozy for industry.

Separately, the commission found after a probe of more than 18 months that the energy market in the EU was too concentrated in the hands of companies that controlled supply, generation and infrastructure, stifling competition from newcomers.

Germany's Federation of Gas and Water Suppliers criticized ideas to split up energy companies, saying that such a move would practically mean disowning companies.  


by Fran on Thu Jan 11th, 2007 at 12:16:12 AM EST
[ Parent ]
Financial Times: EU readies for battle over energy markets

Germany and France geared up for a battle to save their powerful integrated energy companies from being broken up after Brussels published plans on Wednesday to tackle "serious competition problems" in the sector.

The crackdown on the power giants is part of an energy policy aimed at boosting competition, fighting global warming and cutting Europe's "addiction" to oil and gas imports from countries such as Russia.

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The European Commission wants to break the market grip of national energy incumbents, which it believes are stifling competition and deterring new market entrants, including suppliers of renewable energy.

José Manuel Barroso, Commission president, said there was a "clear preference" for the full ownership unbundling of integrated power companies such as Eon and RWE of Germany and EdF of France, forcing them to sell off their electricity grids and pipeline networks.

Michael Glos, Germany's economy minister, said the move would be "very difficult" and might breach the country's constitutional property rights. Francois Loos, the French industry minister, said bluntly: "Our system works."

by Fran on Thu Jan 11th, 2007 at 12:25:39 AM EST
[ Parent ]
This could be me and my simplistic world view, but I got the sense they're doing this the whole thing wrong anyway. Even if (mind the -if- folks) further liberalisation of the energy market would be smart, isn't it more sensible to at least go bottom-up instead of top-down? Couldn't they begin with stimulating better integrated, smarter electric grids universally for example? According to the same energy proposal they also want to have renewable energy more easily pouring into the grid.

First breaking up national companies and saying "we need an integrated grid!" sounds just silly to me. What's the word... Oxymoron?

Considering the strong resentment in practically all the bigger member states (barring the UK), this looks like a plan set for complete failure...

by Nomad on Thu Jan 11th, 2007 at 04:57:51 AM EST
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Big business wants centralised power generation, investment banks want a vawe of cross-border utility mergers, and the Commission does what its masters want. It seems there was a tug-of-war between Piebalgs (energy efficiency) and Barroso (market liberalisation) and Barroso won. The FT also just looks at the issue from its masters' perspective.

If the market would provide, according to the Adam Smith's fairy-tale of the butcher and the baker at the marketplace, it would indeed be a bottom-up approach. But we're talking about a government bureaucracy with a central control mentality and in cahoots with big industrial conglomerates. So "free market" is just Doublespeak.

Those whom the Gods wish to destroy They first make mad. -- Euripides

by Migeru (migeru at eurotrib dot com) on Thu Jan 11th, 2007 at 05:04:56 AM EST
[ Parent ]
Big business wants centralised power generation, investment banks want a vawe of cross-border utility mergers, and the Commission does what its masters want.

But that can't be the whole picture, or even the primary focus, can it?  I mean, Barroso might be kowtowing somewhat to his "masters", as you put it, but do you really think he would risk the EU's reputation -- or that other EU policy makers would let him do so -- by enabling a neoliberal-appeasing policy which would undermine such a high-profile agenda?

Look at the headlines:

"Creating A Cleaner Continent"
"Europe Union Proposes Cleaner, More Competitive Energy Market"
"EU challenges world with new climate change target"
"EU sets new climate change target"
"EU Planning to Cut Greenhouse Gas Emissions"
"UK welcomes tough EU energy stance"
"EU challenges world with new climate change target"
"EU Seeks to Lower Energy Consumption"
"EU plans to use 20% renewable power by 2020"
"EU Seeks to Cut Greenhouse Gas Emissions"
"EU calls for 'industrial revolution' in green energy"

Headlines like that create major expectations in the eyes of the world -- and will leave some serious egg on the EU's face -- if the EU doesn't come at least within throwing distance of these targets.

It's great at least to hear about such a bold initiative that raises the bar internationally on what countries should be doing to -- or at least caring about -- with respect to energy policy.

Truth unfolds in time through a communal process.

by marco on Thu Jan 11th, 2007 at 06:14:05 AM EST
[ Parent ]
do you really think he would risk the EU's reputation -- or that other EU policy makers would let him do so -- by enabling a neoliberal-appeasing policy which would undermine such a high-profile agenda?

Whenever the energy paper gets to a tricky point it seems to invoke "the market will provide". So, yes.

The EU seeks to do all these things, but the only thing that is a priority for 2009 is market liberalisation. The rest is just targets with no teeth.

Those whom the Gods wish to destroy They first make mad. -- Euripides

by Migeru (migeru at eurotrib dot com) on Thu Jan 11th, 2007 at 06:31:57 AM EST
[ Parent ]
are those of the business press

The FT's is:

EU readies for energy battle
Brussels to crack down on national power groups
Kroes may resort to antitrust legislation


Germany and France geared up yesterday for a battle to save their powerful integrated companies from being broken up after Brussels published plans to tackle "serious competition problems" in the sector.

Emissions change are mentioned in the last apragraph of the story and in an article in inside pages.

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

by Jerome a Paris (etg@eurotrib.com) on Thu Jan 11th, 2007 at 06:39:28 AM EST
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"The only headlines that matter are those of the business press"

And that would be because...?

Those whom the Gods wish to destroy They first make mad. -- Euripides

by Migeru (migeru at eurotrib dot com) on Thu Jan 11th, 2007 at 06:41:16 AM EST
[ Parent ]
The only headlines that matter are those of the business press

If you're right, then we're already lost.

But I hope you're wrong.  I hope that public opinion, public expectations and preferences, both within Europe and around the world -- not just business opinion -- can influence the EU's public policy.

Truth unfolds in time through a communal process.

by marco on Thu Jan 11th, 2007 at 06:45:33 AM EST
[ Parent ]
By the way, this seems to be following Bush's playbook: "there is a dire problem, the EU must act now, here is urgent legislation to achieve these ambitious objectives". In reality, the objectives hide a different agenda, and if you oppose the legislation because of its actual, likely "unintended" consequences, you'll be accused of opposing the stated ambitious and urgent objectives.

Those whom the Gods wish to destroy They first make mad. -- Euripides
by Migeru (migeru at eurotrib dot com) on Thu Jan 11th, 2007 at 06:51:27 AM EST
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It's like watching people on drugs.

"There's a problem!"

"Yeah man - hey - yeah - you're right. A problem. I totally get that."

"The house is burning down!"

"Burning down? What? Oh - yeah. Bad. Very bad."

"We must do something!"

"Yeah - do something - right. How about - I know - let's say here's the answer. And we'll pray to this statue of Adam Smith. That always works. Right? Solved. Cool. Yeah. Hey... What were we talking about just now?"

by ThatBritGuy (thatbritguy (at) googlemail.com) on Thu Jan 11th, 2007 at 09:18:38 AM EST
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Stop blaming poor Adam Smith. It's hardly his fault that these eejits can't read more than a few quotes from his works.
by Colman (colman at eurotrib.com) on Thu Jan 11th, 2007 at 09:20:11 AM EST
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"It's the statue, man. The statue."
by ThatBritGuy (thatbritguy (at) googlemail.com) on Thu Jan 11th, 2007 at 10:58:08 AM EST
[ Parent ]
Sometimes reading ET is like watching people on drugs.

Those whom the Gods wish to destroy They first make mad. -- Euripides
by Migeru (migeru at eurotrib dot com) on Thu Jan 11th, 2007 at 02:24:52 PM EST
[ Parent ]
Sometimes?
by ThatBritGuy (thatbritguy (at) googlemail.com) on Thu Jan 11th, 2007 at 07:40:34 PM EST
[ Parent ]
We're not necessarily lost, but there will be a battle to be fought in the Council and the European Parliament. Eventually there will be a directive, and I wonder what real power the Commission has to apply "anti-trust" regulations to the energy markets.

But it would be interesting to come up with a coherent reply to the document, and try to get that to the national ministers that will take part in the discussion in the Council (in March, I believe?).

Those whom the Gods wish to destroy They first make mad. -- Euripides

by Migeru (migeru at eurotrib dot com) on Thu Jan 11th, 2007 at 06:59:35 AM EST
[ Parent ]
After a quick look at the French press:

  • No outlet I have seen places the Energy plan as top news. It's secondary, not a headline. Impression confirmed by French public radio (Inter) this morning, where I don't think I heard the plan mentioned at all (Though I wasn't listening all the time!).
  • On the left, the "this is all about climate change" narrative seems to have worked. Libération has a brief article on the "green" aspect; Le Monde has an interview with Greenpeace which (predictably?) complains about support for nuclear (?); the Nouvel Observateur says:

    Si les couplets traditionnels sur la nécessité de diversifier les fournisseurs et de créer enfin un grand marché européen de l'énergie libéralisé y figurent, l'accent est clairement mis sur l'importance, pour l'UE, de rester le leader mondial en matière de lutte contre le changement climatique.

    Though the traditional verses about the need to diversify suppliers and at last create a great liberalised European energy market do feature [in the plan], the accent is clearly placed on the importance, for the EU, of remaining world leader in the fight against climate change.

  • The Figaro and the Tribune (conservative and business, respectively), while still not handling the Communication as a top news item, look at it from the point of view of a tussle to come between Paris and Brussels over "national champions" and liberalisation. Headline of La Tribune: Energie: Bruxelles et Paris s'affrontent (Energy: Brussels and Paris face off).

by afew (afew(a in a circle)eurotrib_dot_com) on Thu Jan 11th, 2007 at 01:45:40 AM EST
[ Parent ]
the energy review was not mentioned once in the hour I listened to France-Info (the - excellent - public 24/7 news station).

In the long run, we're all dead. John Maynard Keynes
by Jerome a Paris (etg@eurotrib.com) on Thu Jan 11th, 2007 at 06:00:16 AM EST
[ Parent ]
Of the four major Spanish newspapers online (El Pais, El Mundo, ABC, La Razon) only El Mundo has an item on it, but it is in the "money" section and puts the emphasis on climate change.

Those whom the Gods wish to destroy They first make mad. -- Euripides
by Migeru (migeru at eurotrib dot com) on Thu Jan 11th, 2007 at 06:05:07 AM EST
[ Parent ]
Catalan newspapers have it both on fornt-page in the electronic edition. So, barcelona is more tuned?

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Thu Jan 11th, 2007 at 06:19:18 AM EST
[ Parent ]
Probably.

The National press is consumed with the latest round of wrangling over terrorism, on the excuse of the meeting of the Conference of Presidents of Autonomous Communities.

Oh, BTW, in other Catalan/Spanish/Energy/Economic news: the Supreme Court yesterday voted to unblock the Gas Natural takeover bid of Endesa, maybe worth a diary? The result of the vote was 16-15, with one judge having retired and another being absent for the day. I wonder whether the judges voted along party lines?

Those whom the Gods wish to destroy They first make mad. -- Euripides

by Migeru (migeru at eurotrib dot com) on Thu Jan 11th, 2007 at 06:23:45 AM EST
[ Parent ]
I don't see it on El Pariodico (though you said they had it last night), but it is in Avui (concentrating on the CO2 reduction targets) and La Vanguardia (Climate Change).

Those whom the Gods wish to destroy They first make mad. -- Euripides
by Migeru (migeru at eurotrib dot com) on Thu Jan 11th, 2007 at 06:49:04 AM EST
[ Parent ]
It has been just deleted from the front-page in the catalan edition. But the link is still in economy

http://www.elperiodico.cat/default.asp?idpublicacio_PK=46&idioma=CAT&idnoticia_PK=370242& ;idseccio_PK=1009

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Thu Jan 11th, 2007 at 07:15:48 AM EST
[ Parent ]
La Vanguardia

http://www.lavanguardia.es/gen/20070111/51300406340/noticias/la-comision-europea-presenta-su-nueva-p olitica-contra-el-cambio-climatico-bruselas-europa-co2-ce-comision-europea-rusia-dur%E3o-barroso-nee lie-kroes.html

La Comisión Europea presenta su nueva política contra el cambio climático
· La reducción de emisiones, el reto ruso y la competencia marcan la propuesta
· La Comisión propone que se reduzcan en un 20% las emisiones de CO2 para el 2020
· El proyecto apuesta por que el 20% de la energía sea renovable en 13 años

Basically the highlights we presented... plus

Unidad ante Rusia y otros
Por mucho que cambien sus políticas, Europa siempre tendrá una considerable dependencia del exterior en energía: hoy alcanza el 50%, en nivel de importaciones sobre el consumo, pero al ritmo actual de crecimiento se situará en el 65% en el 2030. Los países proveedores no siempre son fiables, como Rusia y Bielorrusia acaban de demostrar. Pero para negociar con ellos de forma eficaz y creíble hay que "hablar con una sola voz", según repitió ayer Barroso. Algo que hoy no se está haciendo; y si no se consigue, peligra la seguridad energética. El diálogo con los países terceros se considera también esencial para asegurarse un acceso suficiente a los biocombustibles.

A whole paragraph to stress the "unity agains others", specially Russia or Bielorussia. Otherwise, energy security is in danger

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Thu Jan 11th, 2007 at 05:52:43 AM EST
[ Parent ]
FT: Warning of higher risk of oil price shock


The chance of an oil price shock in the next decade big enough to prompt a global recession is "relatively high", at 10-20 per cent, Jacques Aigrain, the chief executive officer of Swiss Re insurance group, warned yesterday

If the shock did occur, it could cause losses of about $1,000bn (€770bn, £515bn) across the global economy, Mr Aigrain said.

However, over the coming decades climate change might pose far more serious risks to the global economy, he said, arguing that this showed the need for governments and leaders to take serious collective action to tackle the problems.

(...)

The report concludes that of the 23 core risks identified by the team in previous years, 12 had increased during the past year. These include the danger of an oil price shock, a dollar slump, a credit bubble collapse, a Chinese hard economic landing, water shortages, natural catastrophes, terrorism, Middle East instability and the proliferation of weapons of mass destruction.

Read the rest, there's more.

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

by Jerome a Paris (etg@eurotrib.com) on Thu Jan 11th, 2007 at 08:01:32 AM EST
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