On 25 February 2015, the European Commission published ‘A Framework Strategy for a Resilient Energy Union with a Forward-Looking Climate Change Policy.
Cefic believes the Energy Union should focus on free-market solutions to benefit consumers and the competiveness of European industry. In particular a more efficient energy market can help revitalise the European chemical industry, a cornerstone of the EU economy, and underpin manufacturing, wealth-creation and jobs throughout the EU.
Such a Union is urgently needed to combat EU energy costs that are higher than those in competing industrial regions around the world, to reduce expensive energy subsidy and support schemes, and to contain the forces that are driving investment and jobs out of the EU.
Five elements critical to the success of the Energy Union
- Consumer choice and competition should be at the heart of the long-overdue internal energy market, which must deliver uninterrupted, competitively-priced, stable and secure energy to companies and consumers.
- Upgrading grids and interconnectors is essential to ensure a free market in energy. Gas and electricity grids should be open to both domestically-produced energy - including shale gas, and cost-competitive renewable power – and to imported energy, without discrimination.
- Realising the potential of energy efficiency will depend upon development by the EU chemical industry of affordable, carbon-efficient solutions and upon focusing efforts on sectors such as buildings and transport where they have most effect.
- Building a carbon-efficient energy mix will depend upon using market-mechanisms rather than dogma to select the best energy solutions and avoid simply displacing carbon-intensive activities outside the EU. The EU’s Emissions Trading Scheme, a COP21 agreement in Paris later this year and EU policies post-2020 should bear in mind economic realities – the need to strengthen Europe’s industrial competitiveness whilst achieving a carbon-efficient energy mix at the lowest cost.
- Fostering research and innovation is vital to developing technologies that can enhance both energy-efficiency and industrial competitiveness throughout the EU. Funding programmes need to be technology-neutral to enable the best solutions to emerge.
See Cefic views on Energy Union
A view on renewables
Renewable energy holds significant potential to assist in the reduction of CO2-emissions and help security of energy supply. However, renewables have also created new challenges, particularly in terms of costs related to subsidies, the transformation of the EU’s energy infrastructure to accommodate variable electricity production, and the need for backup capacity. Whilst supportive of the drive for a low-carbon energy mix, Cefic believes that achieving this should be pursued in a balanced low path cost, and progressive way, utilising the best available technologies with a key aim to ensure the competitiveness of Europe’s economy.