Forthcoming EU Regulation on Integrity and Transparency on Wholesale Electricity and Gas Markets

The European Commission will put forward on 8 December a proposal for regulation on energy market integrity and transparency. The purpose of the regulation will be to increase transparency on wholesale energy markets and prevent the occurence of market abuse in the form of insider trading and market manipulation. This will entail the adoption of harmonisation measures in the form of standards and oversight mechanisms. According to the European Commission, the adoption of a new regulation is justified because 'important segments of wholesale energy markets are not covered by clear rules prohibiting market abuse that makes prices higher than they should be.'

The Commission takes as overall objective to increase transparency on the wholesale electricity and gas markets for the benefits of competition and of final customers, which will in particular benefit from more transparent retail price fixing mechanisms. This has become a relevant issue for the Commission as markets become more complex and actors more diversified (utilities, traders, financial institutions and the like). The Commission sees also a clear benefit in terms of signals for future investments in energy infrastructure, another major concern of EU energy policy for the moment. Finally, the Commission founds the proposal necessary as the third liberalisation package did not address the shortcomings of market integration at this level. It goes together with the announced policy objective to reinforce energy customer protection.

The proposal has taken into account the conclusions of a report drafted by the Committee of European Securities Regulators (CESR) and the European Regulator's Group for Electricity and Gas (ERGEG) and published in January 2009, as well as from the results from a consultation exercise held in 2010 and available here.

Remaniement Governemental en France: Fin de l'Intégration Institutionnelle des Politiques de l'Energie et de l'Environnement

Sont parus au Journal Officiel de ce matin (JORF No. 274, 26.11.2010) les deux décrets portant attribution de compétences en matière d'énergie et d'environnement au sein du nouveau gouvernement Fillon II:

• Décret No 2010-1443 du 25 novembre 2010 relatif aux attributions du ministère de l'écologie, du développement durable, des transports et du logement;
• Décret No 2010-1447 du 25 novembre 2010 relatif aux attributions du ministère de l'économie, des finances et de l'industrie.

Le premier décret porte inter alia sur l'attribution du dossier environnement, développement durable et climat, et le second sur celui de l'énergie. Cette nouvelle répartition des compétences note la fin de l'intégration institutionnelle au sein du même ministère des politiques de l'énergie et de l'environnement. Une telle évolution va l'encontre de la tendance observée au cours des dernières années en Europe d'une fusion de ces portefeuilles. Voir anisi la création au Royaume-Uni du Department of Energy and Climate Change (DECC), en Belgique du Ministère fédéral belge pour le Climat et l'Energie (Ministère Climat Energie), ou encore au Danemark le Ministère du Climat et de l'Energie (Kemin). A noter également que le dossier énergie à plus souvent été associé à la problématique du changement climatique que de celle plus générale de l'environnement, comme le faisait le feu Ministère de l'Ecologie, de l'Energie, du Développement Durable et de la Mer (MEEDDM). Peut-être était-il plus innovant qu'il n'y paraissait. L'évolution en France dénote également de la difficulté de gérer des portefeuilles devenus trop gros et qui, de facto, se subdivisent. D'autres instances ont opté pour la création séparée de portfeuilles dédiés à une problématique transversale comme le changement climatique. Ce fut le cas au sein de la Commission européenne avec l'instauration de la Direction Générale Climate Action.

Les conséquences de la réogarnisation des portefeuilles ministériels en France sont tant d'ordre organisationnel que de fonds. Elles posent une question plus fondamentale sur la gestion intégrée de ces dossiers, dans un but de cohérence administrative, de procédure législative et d'intégration pratique au quotidien. Cette question appelle à une prochaine note plus approfondie sur la question.

Fiscalité de l'Electricité: La Commission Européenne Traduit la France devant la Cour de Justice

La Commission européenne a rendu publique hier son intention de traduire la France devant la Cour de Justice de l'Union Européenne. La Commission européenne estime que la France n'a pas transposé correctement les dispositions de la Directive 2003/96 EC du Conseil du 27 octobre 2003 restructurant le cadre communautaire de taxation des produits énergétiques et de l'électricité (JO L 283, 31.10.2003, p.51). La Commission avait préalablement envoyé un avis motivé aux autorités nationales le 18 mars 2010 (IP/10/295).

Dans son communiqué de presse (IP/10/1575), la Commission fait valoir que: 'La France disposait d'une période transitoire jusqu'au 1er janvier 2009 pour adapter son système de taxation de l'électricté dans le cadre de la directive 2003/96/EC ... Actuellement, le système francais ("taxes locales sur l'électricté") prévoit une différenciation des taxes sur une base locale, ce qui signifie qu'un consommateur qui réside dans une commune donnée ne paie pas les mêmes taxes qu'un consommateur résidant dans une autre commune ou un autre département. Un tel système n'est pas conforme aux dispositions de la directive."

La Commission fait également valoir que les modifications annoncées, particulièrement du fait de l'adoption de la loi NOME, maintiennent le système en vigueur que la Commission estime contraire à la directive.

Un dossier essentiel à suivre aux impacts directs pour les consommateurs.

La Loi NOME Est Adoptée

Le projet de loi portant nouvelle organisation du marché de l'électricité en France (dite Loi NOME) a été adoptée hier 24 novembre 2010 par l'Assemblée Nationale en seconde lecture. Le compte-rendu des derniers débats parlementaires au sein de l'Assemblée est accessible ICI.

Havvind Rapporten på Høring

I dag, 24. november 2010, sendte Olje- og energidepartementet (OED) ut rapporten om Havvind på høring. Rapporten ble offentliggjort tidligere 8. oktober (se tidligere notate).

Rapporten gjelder presis et forslag til utredningsområder og dekker flere relaterte spørsmål, blant annet: regulatoriske forhold, teknisk-økonomiske forhold, miljøbeskyttelse, arealbruksinteresser, metode for å velge arealer, og sammenligning med erfaring fra andre land.

OED har identifisert 15 potensielle havvind områder lang norsk kysten. Neste etappen blir gjennomføring av strategiske konsekvensutredninger for områdene som blir valgt ut.

Frist til å sende kommentarer er 31. januar 2011.

EU ETS: EU Regulation on Auctioning Rules for Emission Allowances Published

In today's official journal of the European Union (EU) (OJ L 302 of 18.11.2010, p.1), was published Commission Regulation (EU) No. 1031/2010 of 12 November 2010 on the timing, administration and other aspects of auctioning of greenhouse gas emission allowances pursuant to Directive 2003/87/EC of the European Parliament and of the Council establishing a scheme for greenhouse gas emission allowances trading within the Community.

The Regulation provides rules on the design of the auctions under Directive 2003/87/EC(Articles 4-7), auction calendar (Article 8-14), access to auctions (Articles 15-21), appointment of the auction bodies (auctioneer, auction monitor, auction platform) (Articles 22-35), auction market rules (market abuse, payments, transfers, delivery, management of the collateral, fees and costs of auction, market surveillance, transparency and confidentiality (Articles 36-63).

Pursuant to its scope of application (Article 2), the Regulation is applicable to the auctioning of allowances from the aviation sector (Chapter II of the EU ETS Directive) and from stationary installations (Chapter III), from 1 January 2013.

Nouvelles Modalités de Raccordement pour les Energies Renouvelables en France: Instauration d'un Producteur Mandataire Unique

Le Réseau de Transport d'Electricté (RTE), le gestionnaire du réseau de transport d'électricité en France, a rendu public ce jour la mise en place de nouvelles modalités pour l'instruction des demandes de raccordement d'installations utilisant des énergies renouvelables (ENR). Cette mesure vise à anticiper l'évolution réglementaire annoncées par le MEEDDM et porte sur le raccordement en un point unique du réseau public de transport de différentes installations de production d'électricité ENR.

Des installations de producteurs d'ENR solidairement responsables vis-à-vis de RTE

Ces nouvelles modalités sont conditionnées à la signature d'une convention entre producteurs d'ENR raccordement conjointement par laquelle ils s'engagent sur deux points: établir une responsabilité solidaire vis-à-vis de RTE, ce qui entraînera les adaptations contractuelles nécessaires; désigner un mandataire parmi eux comme représentant unique (le "producteur mandataire").

Le producteur mandataire comme interlocuteur unique

Le producteur mandataire porte, en tant qu'interlocuteur unique vis-à-vis de RTE, une lourde responsabilité en:

• apportant preuve du respect de toutes les conditions nécessaires au raccordement, telles les autorisation d'exploitation et divers permis;
• signant au nom de tous les autres producteurs les contrats et conventions avec RTE pour le raccordement et l'accès au réseau;
• veillant à la bonne exécution des divers contrats et engagements avec RTE pour l'ensemble des producteurs.

Source: Dépêche RTE-DICAP, 12/11/2010.

Reinforced Transparency Requirements in Access to Natural Gas Transport Systems

Amendments to Regulation (EC) No 715/2009 on conditions for access to the natural gas transmission networks have been published in today's the Official Journal of the European Union, in the form of a Commission Decision.

The Decision amends Chapter 3 of Annex I to the Regulation, by detailing further transparency requirements in the access regime to the transportation system. As its title indicates, Chapter 3 relates precisely to:

• the definition of the technical information necessary for network users to gain effective access to the system;
• the definition of all relevant points for transparency requirements; and
• the information to be published at all relevant points and the time schedule according to which this information shall be published.

In short, it details the list of information about systems and services Transmission system operators (TSOs) must provide to those seeking access (points 3.1.2, 3.2, 3.3 and 3.4) and the form of the publication (point 3.1.1). Those additional requirements contribute to the reinforcement of transparency on the natural gas transportation market. The ultimate goal consists in ensuring effective access to the transportation systems and providing a minimim guarantee of equal market access conditions in practice, in other words reinforcing competition on these markets.

References: Commission Decision 2010/685/EU of 10 November 2010 amending Chapter 3 of Annex I to Regulation (EC) No. 715/2009 of the European Parliament and of the Council on conditions for access to the natural gas transmission networks, OJ L 293 of 11.11.2010, p.67.

New Energy Strategy Towards 2020 Presented by the European Commission

The European Commission presented today its new energy strategy towards 2020. More analysis to come on the SEL Notebook shortly.

References:

• Press release, European Commission, IP/10/1492;
• Full text of the new Energy Strategy Towards 2020 available on the DG TREN website.

NER 300: First Call for Proposals Published - Updated

Following the adoption of Decision C(2010) 7499 (see previous post analysing Commission's Decision), the first call for proposals under the Commission's Decision has been published in today's Official Journal (OJ c 302, 09.11.2010, p.4).

The full text of the call is available HERE or on the "NER 300 Website" of the Commission's DG Climate Action at: http://ec.europa.eu/clima/funding/ner300/index_en.htm.

Who can submit a proposal - The project sponsor can either be a single project operator or a consortium.

Level of support - Under the call, and pursuant to the Commission's Decision, the financing threshold is fixed at 50% of the relevant costs (defined in point 4.5 of the call), except when the project sponsors provides more than 50%, which involves a consequent and proportional reduction of the NER 300 financing. In order to ensure that the requested technologies adn developed and that a certain geographical balance is kept, the total amount of funding to an individual project is limited to 15% of the total funding available (point 4.4 of the call). Some rules also apply to the combination of aids to the same project (point 4.6). Projects that accumulate support must clear any state aid issues, in particular whether it is necessary to notify additional state aids to the Commission. The NER 300 support in itself is not a state aid since it does not involve state resources (see point 6).

Submission procedure - Project sponsors must submit their application to the competent Member State by 9 February 2011. Member States will then procede to the eligibility assessment by 9 May 2011, deadline for submission to the European Investment Bank. The EIB should provides the Commission with its list of selected project 15 months after publication of the call, which means by the end of 2011/beginning 2012. The Commission should take its Award Decisions in the second half of 2012. Meanwhile, the legally binding instruments necessary to the implementation of the projects must be in place between the Member State and the project sponsors (Article 11 of the Decision, Annex 4 of the call). The project must be submitted in the country where it will be implemented, even if the project sponsors are from a different Member State. However, some project can be of trans-boundary nature. In that case, the Member State receiving the application must contact the other Member State concerned. The criteria for trans-boundary projects are defined in the call.

Forms - Different forms apply to the different sub-categories. All the documents are available on the Commission's website.

Additional reference: European Commission Press Release IP/10/1476 of 09.11.2010.

Loi NOME: Vers Une Adoption Rapide

Suite au peu de modifications adoptées par la Commission des Affaires Economiques de l'Assemblée Nationale lors de son examen du texte en deuxième lecture le 3 novembre dernier, le projet de loi portant Nouvelle Organisation du marché de l'Electricité (dite Loi NOME) devrait être rapidement adopté. La discussion en séance publique aura lieu le 17 novembre prochain.

Smart Grid Viewed by the French Energy Regulator (CRE)

The French Energy Regulator (Commission de Regulation de l'Energie, CRE) has made public today the first pillars of its strategy on smart grids. It intends to coordinate an institutional think tank on smart grids, organise public thematic debates (e.g., on electric vehicles, smart home, economic models for smart grids, supergrids, micro-grids, application to insulary areas), develop its publications, report of the international experiences, and concentrate the future national debates around a website dedicated to the the topic: http://www.smartgrids-cre.fr/

The first public event on smart grid organised by the French regulator was held in January 2010 in the form of a symposium and was followed by the publication also today of a book "L'Electricité du futur: un défi mondial" (Economica, 2010).

The press file released today by CRE introduces the main elements of the smart grid concept.

Renewables Policies: Outcomes of the Delhi International Renewable Energy Conference (DIREC 2010)

The Government of India organised the Delhi International Renewable Energy Conference (DIREC) 2010 on 27-29 October 2010. The theme of the conference was 'Up-scaling and Mainstreaming Renewables for Energy Security, Climate Change and Economic Development.' The support organisation for the conference, the Renewable Energy Policy Network for the 21st Century (REN 21), has just published the outcomes of the conference.

The institutional framework of the IRECs - DIREC 2010 is a follow-up event of an initiative created in 2002 at the World Summit on Sustainable Development in Johannesburg. The previous International Renewable Energy Conferences (IRECs) were hold in Washington in 2008 (WIREC), Beijing in 2005 (BIREC) and Bonn in 2004 (Bonn "Renewables2004").

The IRECs are organised around different sessions that refelct the diversity of the participants: ministerial level plenary sessions, interactive ministerial sessions; interactive stakeholder sessions; joint ministerial and stakeholder sessions; break out sessions on cross-cutting issues; CEO roundtables; and diverse side events and trade show.

Forms of cooperation and discussion - The starting point for discussion was the roadmap elaborated by REN21 entitled the Delhi International Action Plan (IAP). The IAP is the main instrument of the whole process and is completed at each conference. It is structured around "pledges", that are non-binding commitments made by parties to the different stakeholder groups. This means that any party can submit a pledge. The organisers see it as "a powerful and flexible way to stimulate voluntary action on renewables." 374 pledges have been submitted as of today. Because DIREC 2010 was held in India, the submission of pledges focused on the deployment of renewable energy in rural areas was particularly encouraged. The implementation of the pledges made are controlled or assessed (more exactly) by a reporting system one year after submission. Good pledge and good implementation can be rewarded by an award at the next IREC. The Pledges Database is accessible here. The Database is indeed a rich source of inspiration and control for the adoption and implementation of RES policies, on a voluntary basis. 31 new pledges were addedd along DIREC 2010.

DIREC 2010 Declaration - DIREC 2010 also closed on the adoption on 29 October of the DIREC Declaration. The Declaration insists on the following:

• the growth in renewable energy generation has increased despite the financial and economic crisis, mainly driven by policy. As of the beginning of 2010. more than 100 countries had adopted renewable energy targets and/or RES support policies. This growth concerns both industrialised and developing countries: "more than half of the existing renewable power capacity is now in developing countries." (para.3)
• But much remains to be done: "The world has tapped only a small amount of the vast supply of renewable energy resources. For the upward trend of renewable energy growth to accelerate, technology development and policy efforts need to be taken to the next level, and large-scale private investment needs to be encouraged." (para.4)
• The recourse of RES will directly contribute to alleviate energy poverty, but also poverty itself for the achievement of the Millenniun Development Goals (MDGs) (para.5). The objective is there to reach universal access to modern energy services by 2030 (para.6).
• The conference called upon the United Nations to designate 2012 as the International Year of Energy Access (para.7).
• Investments in research, development and deployment (RD&D) should be reinforced (para.8).
• Capacity building will be crucial to concretise the objectives (para.10).
• "Public funds are instrumental in leveraging and incentivizing large-scale private investment in developing countries..." (para.11).

References:

• Website of the conference, http://www.direc2010.gov.in/;
• REN 21 website dedicated to IREC and IAP.
• Norwegian Ministry of Energy and Petroleum press release on its participation.

NER300: The European Commission Adopts Criteria for the Financing of CCS and Innnovative RES Commercial Demonstration Projects

Commission Decision 2010/670/EU of 3 November 2010 has been published in the OJ of 6 November, L 290, p.39. The decision lays down the criteria and measures for the financing of commercial demonstration projects for carbon capture and storage (CCS) and innovative renewable energy technologies (RES).

The adoption of such criteria was a requirement under Article 10a(8) of Directive 2003/87/EC establishing a scheme for greenhouse gas emission allowance trading with the Community (EU ETS Directive), as amended. It also answers the demand made by the European Council of June 2008 to establish a mechanism for the public and private investments in the construction and operation by 2015 of up to 12 CCS demonstration plants. In particular, Commission Decision answers the requirement of Article 10a(8) of Directive 2003/87/EC to adopt rules and criteria for the selection and implementation of the above mentionned projects, based on the revenues of the sale of 300 million allowances from the New Entrants Reserve (NER 300). The Decision also provides the basic principles for the monetisation of alowances and for the management of revenues.

A selection process driven by the Commission, with the cooperation of the Member States - The Commission makes clear the leading role it intends to play in the selection of the projects, while it is assisted by the Member States:

"The establishment of an EU demonstration programme ... cannot be sufficiently achieved if projects are selected on a national level. The selection should therefore take place at Union level. ... Member States should be responsible for collecting funding applications from the sponsors and for the evaluation of the projects ... "

Pursuant to the Decision, Member States, that will co-finance in practice, do have a word to say on the national projects they want to co-support. After pre-selection at national level, they submit the applications to the EU selection process. The draft list of selected projects is then submitted to the Climate Change Committee for final decision (Article 5). Member States play a central role in the annual disbursement of revenues for the sale of allowances to project sponsors on the basis of legally binding instruments (Article 11).

Role of the European Investment Bank (EIB) - The EIB is already involved at the stage of the decision making process. Beyond project selection, the EIB will intervene in monetisation of allowances and the management of revenues (Article 10). The 300 million allowances will be transferred to the EIB for monetisation and management of the revenues. The EIB is indeed responsible for selling the allowances on the carbon market, managing them and transferring them to Member States (see procedure in Article 11). Revenues that are not disbursed to projects sponsors by Member States are returned to the EIB. Such intervention is justified, according to the Commission, by the EIB expertise in project selection and financing.

Award procedure - The NER300 revenues will be awarded to the selected projects in two rounds of calls for proposals: first round dedicated to mature projects (200 million allowances); second round, dedicated to corrections as regard financing and balance between different technologies (remaining allowances, 100 million or more). The calls will be published in the Official Journal of the EU.

Eligible technologies - The Decision adopts criteria as the technologies eligible to financing. The latter should be "innovative in relation to the state-of-the-art in the key substreams for each technology," not yet commercially available, but sufficiently mature for demonstration at pre-commercial scale, they should also have a high replicability potential. The Decision also requires that a balance is kept between CCS and RES projects: 8 CCS (with at least three in CCS with hydrocarbon reservoir storage and CCS with saline aquifer storage) and innovative RES projects. Eligible projects must:

• fall into one of the categories set out in Part A of Anne I (CCS or innovative RES);
• comply with the requirements set out in Part B of Annex I (Project requirments: I common requirements; II CCS demonstration projects);
• projects listed in Annex A.II of Annex I (innovative RES) must be innovative in nature. Existing, proven technologies are ineligible.

Eligible costs - The rules applicable to the calculation of eligible costs are defined in Article 3 of the Decision, with particular emphasis on the nature of investment costs.

Climate Refugees on the Agenda on the 4th Global Forum on Migration and Development

The 4th Global Forum on Migration and Development (GFMD) is going to be held in Puerto Vallarta, Mexico, from 10 to 11 November. The GFMD is "a voluntary, informal, non-binding and government-led process" that is opened to all members and observers of the United Nations (UN) to discuss issues of migration anf development, through a better understading of the challenges faced and the sharing of experiences in order to reach "practical and actional-oriented outcomes." The GFMD has not highly structured functioning rules, but operates on the basis of some Operating Modalities.

The theme of the Mexico meeting has been defined as "Partnerships for migration and human development: shared prosperity - shared responsibility." The three Roundtables will focus on: (1) the partnerships for migration and development: partnerships for more regular and protected migration, joint strategies to address irregular migration; (2) human mobility and human development: focusing on labor mobility, and then migration, gender and family; and (3) policy and institutional coherence to address the relationship between migration and development.

Roundtable 3.2 will discuss the "relevance and impact of climate change on migration and development." The GFMD intends here to fill the gap between the wide theoretical research on the topic and the very few decisions in practice.

See among the already extensive literature on climate change and migration:

• Migration and Climate Change, by Oli Brown, for the International Organization for Migration, Geneva, 2008;
• Future Floods of Refugees - A comment on climate change, conflict and forced migration, by V. O. Kolmannskog, for the Norwegian Refugee Council, Norway, 2008;
• Climate Change and Conflict: The Migration Link, by N. P. Gleditsch, I. Salehyan, R. Nordas, Policy Papers, CWC Working Paper Series, 14 May 2007.

The Meeting should be structured around the following questions: What are the key issues for development raised by the impact of climate change on migration? Can migration be considered as a form of adaptation? Which partnerships can be created between governments and other actors to assess the effects of climate change on human mobility, and to address the possible migration flows resulting from climate change?

The GFMD will be preceeded, as usual, by the so-called Civil Society Days (8-9 Nov.) gathering an even broader audience. Climate change, migration and development will also be debated during the Civil Society Days.

References:

• GFMD website;
• GFMD Mexico 2010;
• Theme Concept Paper for GFMD Mexico 2010.