Local view for "http://purl.org/linkedpolitics/eu/plenary/2008-09-24-Speech-3-281"
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"Mr President, I think these are very timely questions and this is a very important debate. The Commission is now finalising the second Strategic Energy Review, which is also based on the debates in this House. I expect that this second Strategic Energy Review will be adopted in November, and it will particularly cover the issues that we have been addressing today.
Energy efficiency, renewables and diversification: it is very clear that our main lines are in our energy and climate policy, and it will be prominent in our Strategic Energy Review.
There is already a substantial European legal framework in place. In addition, there are many actions being pursued under the current Energy Efficiency Action Plan, including also legislative initiatives and studies. And there are also support actions, for example under the Intelligent Energy Europe programme.
Regarding existing EU legislation, it is implementation that is very essential. The ambitious 2020 target for energy savings cannot be met without adequate transposition by Member States. The Commission is vigorously pursuing infringement procedures to ensure that member countries are really implementing their existing EU legisaltion.
This year the Commission also will adopt an energy efficiency package. This will include a communication with a comprehensive overview of the Commission’s ambitions for energy effciency, as well as legislative and policy initiatives – in particular, prominent proposals for an ambitious recast of the Directive on the energy performance of buildings; also for a modification of the Energy Labelling Directive, to ensure more effective and dynamic labelling. Needless to say, continued high energy prices further support the need for action in this area. And also we get clear involvement of the European Investment Bank in this area.
The European Council, when analysing the appropriate responses to the high oil price situation, underlines the importance of a sustainable and adequate tax framework.
There is considerable scope for the EU and its Member States to make more systematic and effective use of taxation to encourage energy savings. The Commission intends to present proposals and recommendations on the cost-effective use of taxation and specific tax incentives, including reduced VAT, to promote the demand and supply of energy-efficient goods and services.
Furthermore, in its review of the Energy Tax Directive, the Commission will look at how it can better support the EU’s energy and climate policy, encouraging energy efficiency and emission reductions. More widespread and systematic use of road pricing, in line with the principles of the Commission’s ‘Greening Transport’ Communication, would also encourage a shift to more energy-efficient transparency rules.
On financing alternative energy technologies and research, let me draw your attention to the fact that we are in the process of preparing a communication on financing low-carbon technologies as a follow-up to the European Strategic Energy Technology Plan. The Communication will analyse the resource needs for long-term research and development, large-scale demonstration projects and the early-stage commercialisation phase. We are considering measures that best use public investment to leverage additional private investment, such as the creation of a specific facility for large-scale demonstration projects. This could be built on existing instruments such as the Risk Sharing Financing Facility, a joint initiative of the Commission and the European Investment Bank. The Commission also encourages Member States to use national resources, for example potential resources that could be raised through the auctioning of CO
allowances in the revised ETS schemes.
On energy security and foreign policy aspects, I come back to the idea that Europe can and must reinforce its own strengths to deal with the fast-changing global energy economy. Internal and external policy in energy work together. The stronger a common European energy market is, the stronger it will be towards external energy suppliers. We are pursuing diversification with countries like Azerbaijan, Turkmenistan, Egypt, Iraq, Nigeria, but it is clear that we also encourage predictable relations with current suppliers like Russia, and definitely we are looking very much at the possibility that Norway could increase supply to the market, because it is very clear that the EU market is attractive for suppliers, and we should not be afraid that we will run out of gas, but we should really work for competitive supplies to the European market and not be in a situation where we could be blackmailed on prices.
Regarding the issue of assistance to oil-importing developing countries. Given the strong impact of access and price of energy on development and global climate change, energy cooperation is increasingly important throughout our development assistance activities. It was a central theme of my joint visit with Commissioner Michel to the African Union and a number of African countries earlier this month. We invest substantial resources in supporting movement of these countries, not only to eliminate energy poverty, but to power themselves with clean and new energy sources.
Definitely there is a limit to what we can propose in the strategic energy review due to the Lisbon Treaty ratification, because there is an energy article that would give much more opportunity to streamline the response. But still we can do quite a lot.
On macroeconomic and social aspects, the increase in oil price levels certainly put a strain on consumers and certain sectors of the economy which face difficult adjustment processes. More immediately, most member countries have undertaken – or are currently considering – short-term measures in response to the recent surge in energy prices. In line with the European Council conclusions, most of these policies focus on vulnerable households. Some Member States have also implemented or discussed temporary measures targeted at specific sectors.
As high energy prices are expected to prevail in the long term, it is essential that the policy measures aim at facilitating the structural shift to more sustainable patterns of production, transport and consumption. This also points to the significance of flexible product and labour markets and the Lisbon agenda, and to the importance of the transition towards a low-carbon and highly energy-efficient economy.
But I believe there is clearly not one answer to these issues. Still, the framework that we propose with the energy and climate change package and the internal energy market package is a backbone, because, the sooner it is adopted, the stronger we will be, and also there will be more competition and lower prices for consumers. At the same time we should be open and honest and say to the people: do not expect oil prices to come back to USD 20 per barrel. That means each of us also should change our behaviour, because part of the issue is also our behaviour, and I believe that we should really pay true attention in our everyday lives.
The Commission shares the opinion that oil prices are likely to remain high in the medium and long term. The justification for this type of prognosis is volatility in daily markets. Even if now, the oil price is USD 106 or USD 110 per barrel, which is much lower than it was some time ago, at USD 145, the daily volatility still makes the situation relatively difficult to predict, and it is definitely making a major, wide-ranging impact and deserves a response.
While there is clearly a need for short-term action by Member States to mitigate the impact on the most vulnerable households, the main policy response should aim at facilitating our transition towards clearly more sustainable ways of producing and consuming energy. In other words, to pursue our aim of becoming a low-carbon and energy-efficient economy. In order to do so it will be vital to take forward the Commission’s proposals on climate and energy policy, following up on the political commitments of the European Council.
On the structural reforms. It is important to underline that we are facing an energy price increase, not only for oil: it also goes for coal, it also goes for gas and, as a result, it also has an impact on electricity prices. Links between these prices are related by pricing structure: for example, gas contracts often use oil price benchmarks; gas-fired electricity generation is increasingly marginal and thus price-setting. So I think it is very important to address not only issues about oil prices but all the sectors. The situation clearly reinforces the need for encouraging competition throughout the whole energy sector. That is why, again, I would like to underline the importance of swiftly reaching an agreement on the third internal energy market package.
Europe can and must develop its own strengths to deal with the fast-changing global energy economy. A well-functioning, fully interconnected and competitive EU-wide internal market is a response. This will diminish European vulnerability to energy-supply disruption and facilitate our cooperation with energy producer and transit countries. Solidarity between Member States in crises will be enabled by European networks.
On European energy oil stocks, we have now prepared legislation that will clearly address two things: one, that these oil stocks will be always available at moments of crisis and can be easily used; and second, it is issues of precedence addressed, it is transparency and reporting on a weekly basis on commercial stocks. In this respect, even though we are not the biggest oil consumer in the world, we are able to influence transparency in the market and diminish volatility and the level of speculation in the market.
Speculation is definitely an issue. We have done an analysis. The available evidence suggests that supply and demand are the main drivers of oil prices, and that these fundamentals are set to underpin high prices in the future. But, at the same time, we will continue our work on analysing what impact speculation has at a particular moment and whether there is really the ability to diminish volatility and have more supervision in the energy market.
In any case, it is very clear that transparency in oil markets, both in terms of contracts and related financial instruments and fundamentals, is a must. I would also like to say that both Commission and national competition authorities are acting against anti-competitive behaviour. This is a way in which we can pass the changes in oil prices to the consumers, because consumers use refined products. The Commission will make additional efforts in this respect – we are following this issue – and a lot of competition authorities in member countries have already started investigations into the issue of how soon and how fast the oil price changes are being passed to the consumers. At the same time it is very clear that there are differences between different member countries, because there are different sourcing strategies for the companies concerned. Also, in some countries there are biofuel blends that also influence the velocity of the possibility to change prices according to the oil price. Nevertheless, it should be very clearly in the focus of attention in all anti-trust authorities."@en1
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