April 2021 View this newsletter in your browser here.

 

Editorial

We were happy to see that well over 400 people attended CEER’s (first-ever online) Annual Conference on 30 March and we thank EU Energy Commissioner Kadri Simson for giving the keynote address. Please see below for more on the conference, its speakers and its topics covered.
 

Looking ahead, CEER will respond to the European Commission’s Public Consultation on hydrogen and decarbonising the EU gas market and before then, present some views at the 29-30 April European Gas Regulatory (‘Madrid’) Forum (see below).

Upcoming events

In late May or in June, CEER, along with ACER, will hold a webinar to discuss the topics of regulatory treatment of hydrogen/hydrogen networks; power-to-gas; and long-term energy storage, building on what is to be presented at the Madrid Forum this week. Please watch out on the CEER website for more details. Newsletter subscribers will receive a news alert with details on the webinar, including how to register, in May. These topics are discussed in the ACER-CEER Green Deal White Papers.

Public Consultation

CEER is developing a new Strategy for the period from 2022 to 2025. The "Empowering consumers for the energy transition" Strategy outlines the overall policy strategy for European energy regulators with a view to promoting the energy transition and contributing to a carbon-neutral society and economy. Please see the draft strategy document for more details about the consultation and the questions contained in the feedback questionnaire. This brief public consultation will be open until this Friday, 30 April 2021 and is carried out through a dedicated online questionnaire.

Please access the questionnaire here.

Publications

  • 29 March: CEER First Analysis of the COVID-19 Pandemic’s Effects on the Energy Sector. This presents CEER’s first analysis of the effects of the COVID-19 pandemic on the energy sector. This interim report seeks to highlight the pandemic’s impact on the energy market as a whole and on energy companies in particular. Furthermore, it summarises the approaches from 28  participating countries to protect energy customers during these extraordinary times. For more, see the section below on CEER’s 30 March Annual Conference.
  • 29 March: CEER Annual Report. As with every year, CEER publishes an Annual Report that looks back on the previous year’s activities and work. The report includes a special section celebrating CEER’s 20th anniversary and provides highlights of CEER’s activities for the period 1 January to 31 December 2020. This includes CEER’s continued work on issues such as consumer rights, digitalisation, dynamic regulation, and decarbonisation. Furthermore, it also includes a look ahead at activities planned for 2021.
  • 8 April: CEER Approach to More Dynamic Regulation. One of the three elements of CEER’s current 3D Strategy is dynamic regulation for European solutions for adaptive regulation in a fast-changing world, and this note gives a brief introduction to some tools of dynamic regulation in use by CEER national regulatory authorities (NRAs). This note asserts that there is a need to develop regulatory frameworks that balance the tension between achieving regulatory goals without discouraging innovation. In the energy sector, there is a need to have trials for innovative solutions for a future energy system which are, for instance, based on renewable energy, energy efficiency, decarbonisation and which are generally also highly digitised. NRAs already rely on experimental regulatory tools to test and anticipate future evolutions such as 1) regulatory sandboxes, 2) pilot projects or 3) pilot regulations. Consumer involvement is also important to support innovation and most NRAs take into consideration consumer views through consultations, transparent discussions or even through dedicated task forces or consultation bodies. The note concludes with a table of national examples of regulatory sandboxes and regulatory experiments from seven countries.
  • 26 April: Report on Monitoring NRAs’ Independence: This report relies on the responses provided by 29 energy national regulatory authorities (NRAs) (24 CEER Members and 5 CEER Observers) to a dedicated survey which contained CEER’s own questions, as well as questions used for the OECD Indicators of Product Market Regulation for the first half of 2020. This report provides a status review on NRA independence four years after a previous CEER report on the topic. The report has a number of interesting findings, of which a few are mentioned here: (1.) Over the last five years, NRAs’ duties and powers to regulate sectors other than electricity and gas have increased significantly. (2.) One-third of the NRAs highlighted a lack of resources (funding), which in their view is not consistent with NRA independence principles. (3.) NRA independence is explicitly stated in law in most countries and the national legislation of some NRAs’ countries contains a legal definition of the NRA’s independence. (4.) NRAs have experienced growth in their staff numbers throughout the last three years, while the share of staff members dedicated to energy regulation has either remained the same or increased in proportion to the overall staff numbers. (5.) Only a few NRAs require a ‘cooling off’ period for their permanent staff pursuing professional activities in the regulated sector. (6.) Most NRAs receive their financial resources from market participants via fees and other contributions. (7.) Almost all NRAs have sanctioning powers for imposing penalties for non-compliance.

Stakeholder communications questionnaire

While reviewing CEER’s communications strategy, we were interested in feedback from our stakeholders. We prepared a short questionnaire to see how the recipients themselves see our efforts. The survey proved helpful to identify potential gaps and find areas for improvement.

We would like to sincerely thank all 53 respondents for taking their time and responding to this survey. We carefully reviewed the ratings and comments and are delighted to say that 89% of respondents are in general either “satisfied” or “very satisfied” with the communication received from CEER. Our communications clarity, style, and purpose are generally in “very good” and “good” rating, with style being the area that stakeholders identified most for improvement. We are looking into improving the style of publications, including this newsletter later this year. However, we believe it will not bring more value if we open new media channels for disseminating our work, as we did not see much demand for that. Therefore, we will focus on the media we are already using.
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Recent events

CEER’s Annual Conference looked at the energy sector in light of both the ongoing pandemic and the Energy Transition

  • The energy sector’s resilience was proven, but future long-run challenges remain.
  • Well-regulated and deeper cross-sectoral cooperation is needed for a successful energy transition.

Bringing together lessons learnt from the experience of the energy sector during the ongoing Covid-19 pandemic and the need for greater cross-sectoral integration to achieve the energy transition were themes of today’s conference “Dynamic Regulation in Practice: the energy sector during the pandemic and Energy Transition” organised by the Council of European Energy Regulators (CEER). This was CEER’s first-ever virtual annual conference and had some 430 attendees.

The keynote address of the EU Energy Commissioner, Ms Kadri Simson, emphasised that the EU is concentrating its efforts to transform our system, and eventually reach that vision of a net zero Europe via a threefold strategy.

  • Making savings from the very beginning – energy efficiency;
  • Electrifying where we can – boosting renewables; and
  • innovating where we cannot electrify – increasing low-carbon fuels.

Commissioner Simson noted that CEER’s conclusions in its new report released yesterday “First Analysis of the COVID-19 Pandemic’s Effects on the Energy Sector” confirmed the European Commission’s initial stocktaking in June 2020 that the energy sector has proven resilient, thanks to preparedness, and quick and practical responses. Commissioner Simson expressed her thanks to the regulators that have backed restrictions on disconnections and other measures to mitigate the impact of the crisis on consumers. She noted the importance of regulators’ research and data to helping Member States to design effective policies. Commissioner Simson went on to note that she agreed with energy regulators that:

Energy system integration stands out as the blueprint for planning and operating the energy system “as a whole”, across multiple energy carriers, infrastructures, and consumption sectors. It will create stronger links between them with the objective of delivering low-carbon, reliable and resource-efficient energy services, at the least possible cost for society.

The first session on the impact of the Covid-19 Pandemic on the energy sector began with a presentation by Ms Mechthild Wörsdörfer, Director, Sustainability, Technology & Outlooks, IEA. The IEA presented a more global view, with the core message that the clean energy transition must be at the heart of the economic recovery from the pandemic. This was followed up by CEER Vice President Jean-Laurent Lastelle (who also moderated the session) presenting key findings from the aforementioned CEER first analysis of the pandemic’s effects on the energy sector via the experiences and understanding of 28 of its Member/Observer energy regulators. Some of the lessons learnt include: ensuring good and swift information flows; adapting procedures and deadlines where necessary; that a key measure was preventing disconnections of consumers; sharing the burden more widely within the sector; and that remote operations and digitalisation must be wisely utilised.
A panel of short presenters and discussants followed, with virtual audience Q&A:

  • The Covid‐19 pandemic facilitating energy transition opportunities – Prof Jiří Jaromír Klemeš, University of Technology, Brno, Czech Republic;
  • Consequences of the pandemic for energy consumers – never had so many become vulnerable so quickly – Mr Matthew Vickers, CEO, Ombudsman Services UK & Vice President National Energy Ombudsmen Network (NEON);
  • Energy distribution network operator function during the pandemic crisis providing essential services – Ms Marie-Pierre Fauconnier, CEO, Sibelga.  

The Second Session on sector coupling and the energy transition was moderated by CEER Vice President Wolfgang Urbantschitsch, and started with a presentation of CEER’s own work that can be seen in a series of recent White Papers (two of which done jointly with ACER), and was presented by CEER Vice President/Gas WG Chair Pedro Verdelho and CEER Electricity WG Chair Christine Materazzi-Wagner. This recent work reflects CEER’s efforts on dynamic regulation that follows new issues such as, in this case, proper regulation of hydrogen networks and use of power-to-gas facilities and the role of long-term storage in a decarbonising energy sector.
A panel of short presenters and discussants followed, with virtual audience Q&A:

  • The energy sector transformation: Fit for 55 Package – Mr Miklos Gaspar, DG ENER, European Commission;  
  • TSO innovation for a climate-neutral European energy system – Mr Uroš Salobir, Director of the Strategic Innovation Department, ELES (Slovenian TSO);
  • Hydrogen, enabling a zero-emission society – Mr Jorgo Chatzimarkakis, Secretary General, Hydrogen Europe.

The conference ended with CEER President Annegret Groebel giving a preview of CEER’s draft strategy for 2022-2025, which is now out for public consultation. She stressed the importance of well-functioning markets at national and European level, whose value was shown in the current crisis; the consumer-centric focused in the CEER-BEUC Vision 2030; and energy system integration, which was discussed today. These three regulatory dimensions create six core areas for CEER’s work.

European Regulatory Fora

The European Gas Regulatory Forum, also known as the Madrid Forum, gathers key stakeholders across the European energy sector to discuss opportunities and challenges related to the further development and decarbonisation of the internal EU gas market and to its integration with other energy sectors. This year’s event, held online, will be 29-30 April, and in session 6 (afternoon of 29 April), ACER-CEER will present “Regulation  of  future  hydrogen  network.  View  of  the  regulator”. All documents for the forum, including the agenda and background documents from CEER, can be found here.

International

On 29 April, the 9th Workshop Eastern Partnership of Energy Regulatory Bodies was held, for the first time in an online format. In accordance with the Eastern Partnership (EaP) work programmes, CEER and the European Commission (EC) had jointly organised eight specialised workshops with the energy regulatory bodies from the Eastern Partnership countries. Since 2019, the Energy Community Regulatory Board (ECRB) has also been a co-organiser of the workshop. The Eastern Partnership countries are Armenia, Azerbaijan, Belarus, Georgia, Republic of Moldova and Ukraine. There were over 60 regulator participants, with online simultaneous English-Russian/Russian-English interpretation. The focus of the workshop was “The Impact of COVID-19 on the Energy Sector and a “Just Transition” for All”.

For the EC, Marion Schiller-Probst gave an overview of the day. This was followed by a general introduction by CEER President Annegret Groebel. She emphasised the value of continued internal exchange – such as EaP. This is why CEER created an ad hoc group on Covid-19, with their work to be presented at the workshop today. A second important element to highlight is learning from each other on how to best undertake the energy transition and ensuring that the consumer benefits in this as part of a just transition. CEER is proud to have the EC’s trust to be one of three implementing partners of Phase II of EU4Energy, which covers the EaP countries.  ECRB President Marko Bislimoski followed in the opening, noting that with the EaP countries, even if they are not all participating in CEER and/or ECRB, most of the basic regulatory concerns are the same: they are dealing with the current pandemic situation, but also implementing the Clean Energy Package in the long run.

CEER’s EU4Energy Project Manager Eszter Süle gave an overview of the EU4Energy project and CEER’s participation. Then CEER Vice President Jean-Laurent Lastelle presented the “First Analysis of the COVID-19 Pandemic’s Effects on the Energy Sector” first presented at the CEER Annual Conference, as noted above. Dietmar Preinstorfer of CEER Member E-Control then moderated a discussion where Eastern Partnership countries could give a view of the pandemic’s effects in their energy sectors following on the view of the situation in CEER Members and Observers.

This was followed by the EC presenting the “Just Transition” funding in the context of the European Green Deal – how it will be used.

Branislava Marsenic of the ECRB Secretariat presented a study (in progress) on addressing energy poverty and the protection of vulnerable customers, reviewing relevant legislation, before looking energy poverty, such as inability to properly heat homes. Percentages in these countries were often substantially higher than the EU average. Are vulnerable customers being properly targeted by measures in place? Are indicators appropriate? This will be further investigated, with recommendations to be developed.

The final discussion focused on what the “Just Transition” might mean in the context of each of the in the EaP countries and the situation there with their vulnerable customers as well as the energy transition measures being taken more generally. The European Investment Bank (EIB) gave the last presentation of the day on its work on just transition funding and policy, particularly in the context of Ukraine/heating. The workshop ended with a review of the day by the EC. 

Contact

Charles.Esser@ceer.eu

Tel Logo +32 278 873 36

www.ceer.eu

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