Toward a Common European Union Energy Policy

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1 Toward a Common European Union Energy Policy

2 Toward a Common European Union Energy Policy Problems, Progress, and Prospects Edited by Vicki L. Birchfield and John S. Duffield

3 TOWARD A COMMON EUROPEAN UNION ENERGY POLICY Copyright Vicki L. Birchfield and John S. Duffield, Softcover reprint of the hardcover 1st edition All rights reserved. First published in 2011 by PALGRAVE MACMILLAN in the United States a division of St. Martin s Press LLC, 175 Fifth Avenue, New York, NY Where this book is distributed in the UK, Europe and the rest of the world, this is by Palgrave Macmillan, a division of Macmillan Publishers Limited, registered in England, company number , of Houndmills, Basingstoke, Hampshire RG21 6XS. Palgrave Macmillan is the global academic imprint of the above companies and has companies and representatives throughout the world. Palgrave and Macmillan are registered trademarks in the United States, the United Kingdom, Europe and other countries. ISBN ISBN (ebook) DOI / Library of Congress Cataloging-in-Publication Data Toward a common European Union energy policy : progress, problems, and prospects / edited by Vicki L. Birchfield and John S. Duffield. p. cm. 1. Energy policy European Union countries. I. Birchfield, Vicki L., 1965 II. Duffield, John S. HD9502.E82T dc A catalogue record of the book is available from the British Library. Design by Newgen Imaging Systems (P) Ltd., Chennai, India. First edition: July 2011

4 Contents List of Illustrations Foreword Preface vii ix xi Introduction The Recent Upheaval in EU Energy Policy 1 John S. Duffield and Vicki L. Birchfield One Two Three Part I Developments in Key Policy Areas EU Internal Energy Market Policy: Achievements and Hurdles 13 Per Ove Eikeland Foreign Policy and Energy Security: Markets, Pipelines, and Politics 41 Richard Youngs Common Rules without Strategy: EU Energy Policy and Russia 61 Jonas Grätz Four EU Emissions Trading: Achievements and Challenges 87 Jørgen Wettestad Five EU Renewable Electricity Policy: Mixed Emotions toward Harmonization 113 Måns Nilsson Six Energy Savings and Efficiency 131 Jørgen Henningsen Seven Eight Part II National Perspectives French Energy Policy within the EU Framework: From Black Sheep to Model? 145 Sophie Méritet Germany and EU Energy Policy: Conflicted Champion of Integration? 169 John S. Duffield and Kirsten Westphal

5 vi Nine Contents The UK and EU Energy Policy: From Awkward Partner to Active Protagonist? 187 Francis McGowan Part III Cross-Cutting Perspectives Ten Rethinking European Climate Change Policy 217 Arno Behrens and Christian Egenhofer Eleven The Role of EU Institutions in Energy Policy Formation 235 Vicki L. Birchfield Conclusion Taking Stock of EU Energy Policy: Problems, Progress, and Prospects 263 Vicki L. Birchfield and John S. Duffield Contributors 277 Index 283

6 Illustrations Figures 5.1 Growth in renewable electricity generation (in twh per year) Renewable energy use and goals for 2020 in the climate and energy package of The French energy mix in 1973 and 2008 (in percent) Key developments in EU policy formation 251 Tables 5.1 Summary comparison of FIT and TREC Primary energy consumption in 2008 (in mtoe and in percent) Energy production and supply in the UK Simplified summary of climate change impacts in Europe and their intensity Energy policy initiatives and legislative actions 253

7 Foreword Of the challenges that the European Union faces, ensuring a secure, competitive, and sustainable energy supply is certainly one of the more complicated ones. There are few areas of EU policy that energy choices do not impact heavily or at least impinge upon. Climate change, the EU s increasing dependence on imports, the strain on energy resources, and access to affordable energy require an ambitious response, and the benefits or even the need for a more integrated EU energy policy aimed at delivering a low-carbon economy are becoming ever more evident. For that reason, we are fortunate to have this timely, thorough, authoritative contribution to the study of EU energy policy. Professors Birchfield and Duffield have assembled a first-rate team of experts to examine recent developments in EU energy policy and to explore the prospects for future progress in this critical area. This book will be essential reading for scholars of the subject and will provide a very useful reference for practitioners and policy analysts. Günther Oettinger European Commissioner for Energy Brussels May 2011

8 Preface This volume, like its subject matter, was a complex undertaking, It involved the collaboration of scholars from 12 different countries and the coordination of two universities to host a symposium out of which the manuscript developed. The idea for the project originated with a grant proposal to the European Commission and was supported by the award of the European Union (EU) Center of Excellence at Georgia Tech and supplemented with a conference support grant from the Georgia State University Research Foundation. Other material and financial support came from the European Union s Delegation to Washington, D.C., the Atlanta Regional Commission, the Georgia Institute of Technology, and Georgia State University (GSU), for the use of its conference facilities. The editors wish to thank William Downs and Kenya Walker, of the GSU department of political science, for help with conference arrangements and Allison Smith and Ansley Hynes of the EU Center of Excellence at Georgia Tech for logistical and administrative support. Deserving of special recognition are the invited discussants who attended the conference and offered incisive comments and constructive feedback on the research papers presented by the contributors to the volume: Dr. Paul Baer, Dr. Marilyn Brown, Dr. Jay Hakes, Dr. Charles Hankla, Dr. Wilfrid Kohl, Dr. Janelle Knox-Hayes, Ms. Luisa Ragher, and Dr. Adam Stulberg. We also gratefully acknowledge Shane Tomashot, for research assistance and help with the conference, and Matthew Schipani, for research and editorial assistance. A tremendous debt of gratitude is owed to Lauren Kretz who provided skillful research and editorial assistance as well as invaluable help with the final manuscript preparation. Finally, the project would not have been possible without the excellent contributions of the authors. Their wide-ranging knowledge and individual expertise strengthened our collective enterprise, and the collegiality enjoyed among virtual strangers in Atlanta, Georgia during the symposium in November 2009 and throughout the project is a testament to the power and attraction of common purpose. The project was envisioned around the time the Irish initially rejected what eventually became the Treaty of Lisbon. The actual conference took place on the eve of the Treaty s ratification and the

9 xii Preface nomination of the EU s new leadership team as well as the approaching Copenhagen Summit on Climate Change. And now, we complete the manuscript just days after the European Commission unveiled a new energy strategy paper that calls for one trillion Euros in investments over the next decade both to diversify existing resources and replace equipment and to cater for challenging and changing energy requirements. A summit meeting to consider the Commission s proposal was held in February 2011, and in the words of the EU energy commissioner, Günther Oettinger, It s all a matter of national political will... We will be asking heads of state, Do you really want this, or is this just something for speeches? (As reported by Joshua Chaffin, Financial Times, November 11, 2010: 2). While this study shows that sometimes ambitious rhetoric exceeds the will to act and major obstacles to the construction of a truly common energy policy for Europe certainly persist, when the various elements of such a complex, multifaceted policy are disaggregated, it become clear that substantial progress has indeed been made. Despite the pitfalls and remaining challenges, we believe readers will find in this volume reasons to expect that energy policy may in fact be the next big integrative engine in Europe. Vicki L. Birchfield and John S. Duffield Atlanta, Georgia November 2010

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