Editorial June was certainly the month for events (as always presentations and photos are online). Our annual Customer Conference was again a major success. This year, it focused on implementation of the 2020 Vision for Europe’s energy customers. Customers will remain a high priority for regulators in 2014 (see the CEER consultation on our 2014 work programme).
CEER held 2 workshops in the framework of Europe’s Sustainable Energy Week: one (jointly with FSR and CRE) on retail market functioning, and another on delivering Europe’s 2020 climate and energy targets cost efficiently. The latter showcased CEER’s fact-based report on renewable energy (RES) support schemes, (a must read if you want to compare, by technology and country, the volume of electricity receiving RES support and the cost to consumers.) Regulators also presented their response to the European Commission’s Green Paper on a 2030 energy and climate framework (see the Feature article below). Further afield, CEER participated in a G20 Roundtable in Kazan and organised an Eastern Partnership workshop in Georgia. There is also an opportunity to enhance regulatory knowledge around the world (see the International Section).
RES Support and Regulators' recommendations for the 2030 energy and climate framework
The current 2020 energy and climate targets (20-20-20) European heads of state already in 2008 committed to “20-20-20” targets: 20% cut in greenhouse gases; raising the share of EU energy consumption produced from renewable resources to 20%; and a target of a 20% improvement in energy efficiency, by the year 2020. Europe is on track for the CO2 and RES targets but there is uncertainty about the (non-binding) 2020 energy efficiency target.
RES Support This week, during the CEER workshop on “delivering Europe’s 2020 climate and energy targets cost efficiently”, CEER presented its fact-based report of Renewable Support Schemes in Europe. It compares the volume of electricity receiving RES support and the cost to consumers. The European Commission provided a glimpse of its forthcoming Guidance on best practice of renewable Energy Support schemes. The guidance dovetails exactly with CEER's own findings on RES support harmonisation (see CEER Conclusions Paper on the Implications of Non-harmonised Renewable Support Schemes). CEER believes that RES support needed to deliver 2020 targets should be effective, efficient and non-distortionary.
CEER’s view is that harmonising RES support isn’t a panacea. Instead, it is better to signal a clear 2030 direction with pan-EU harmonisation over time. The second part of the CEER workshop examined what shape the 2030 framework might take.
2030 Climate and Energy Framework The European Commission’s green paper on “A 2030 Framework for Climate and Energy Policies” (currently out for consultation), has 4 main parts: targets; instruments; competitiveness and security of supply; and effort sharing.
The CEER response to the Green Paper focuses on 6 key strategic points of relevance to regulatory activities: • Optimal regulatory design benefits from clarity over energy sector goals • Reaffirming the importance of achieving rapid implementation of the 3rd Internal Energy Market (IEM) Package • Delivering investment and consumer protection requires a stable market-based framework, implying structural reform of EU ETS • Importance of ‘total system’ functionality • Importance of (intelligent) networks • Coherence as a key principle in formulating 2030 arrangements
CEER, in its response, reaffirms the importance of rapid implementation of existing laws which is necessary to achieve an EU IEM. CEER’s vision of the IEM includes a 2020 Vision for delivering benefits to energy consumers (which was the focus of a separate annual customer conference this month). CEER believes that achieving the IEM can help to deliver the 2030 objectives and that a stable policy framework to 2030 will assist more efficient investment. A carbon price is a key element of a market-based framework, but the current ETS design is undermining efficient investment. Although sectoral target setting is outside of our remit, uncertainty in relation to the proportions of RES-E on the system has significant planning (and cost) implications for regulators in managing system balancing and financial arrangements. Similarly, a single greenhouse gas (GHG) target does not assist with forward planning / network coordination. A carbon price is a key element of a market-based framework for achieving this, but the instability of the current ETS design - arising from a fixed supply in the face of a steep demand curve - undermines this goal. CEER believes that the Green Paper places insufficient emphasis on the role of gas and electricity networks in supporting 2030 ambitions. Consequently, CEER underlines the role of smart grids and the importance of coherence as a key principle in formulating the 2030 climate and energy framework.
• CEER Response to European Commission Green Paper on a 2030 Framework for Climate and Energy Policies •Joint Press Release: European electricity & gas sector welcomes adoption of anti-VAT-fraud package by ECOFIN Council (21 June 2013) •CEER Press Release: On the path towards achieving the 2020 Energy Customer Vision (19 June 2013)
The International Confederation of Energy Regulators (ICER) has launched a call for papers for the 2015 Distinguished Scholar awards and also invites articles for its twice yearly publication (the ICER Chronicle). See www.icer-regulators.net
CEER participated in the G20 Energy Regulators Roundtable, held in Kazan, Russia on 3-4 June. The outcome of this G20+ Regulators Roundtable is a short Energy Regulators Statement on Sound Regulation and Promoting Investments in Energy Infrastructure.
On 18-19 June, CEER held in Georgia, jointly with the European Commission, its 2nd Eastern Partnership Workshop.