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Environmental Effects of Oil Shale Utilisation and Shale Gas: The French National Assembly Debates

The French National Assembly is debatting today, 29 March, the environmental effects of oil shale use and shal gas production during its public session (video available online here).

Pros and Cons of Corn Ethanol - Infographic

I would like to share with you this Infographic (full size picture here) forwarded by Ecopolitology, which I thank for the information. It points out the pros and cons of ethanol with regards to cornfields in the light of recent debates in the United States.

This allows me to mention that tomorrow, 29 March 2011, is the deadline for submission of responses to the public consultation conducted by the European Commission on the Preparation of a report on additional sustainability measures at EU level for solid and gaseous biomass used in electricity, heating and cooling. Consultation page here. The consultation does not relate to biofuels and bioliquids, but to other energy uses of biomass. It focuses on the necessity to adopt additional sustainability criteria, following the entry into force of Directive 2009/28/EC and the adoption in February 2010 of a Commission's report on sustainability requirements for the use of solid and gaseous biomass sources in electricity, heating and cooling (COM(2010)11).

I also take the opportunity to remind one of my earlier publication on European bioenergy regulation: C. Banet, "Bioenergy as integration of sustainable development principle in energy policy: the particular case of EC biomass regulation," Chapter 4.4, in Bugge and Voigt (eds.), Sustainable Development in National and International Law - What did the Brundtland Report do to Legal Thinking and Development, (Europa Law Publishing, 2008), pp. 443-473.

Interrogations Surrounding the Earth Hour Event

For the ones you know me, they can attest that I am a fervent believer in energy savings measures. The easiest ones are to switch off the light when you do not need it, switch off electronic appliances when you stop using them, or use energy savings fluorescent light bulbs. But the Earth Hour event is posing me some problems.

First, I believe that it is every day that we should be sober in our consumption of energy, and primarily electricity. The mediatic effect of the event is certainly convincing, and making a party of an energy savings campaign looks very appealing. But I believed we were over the phase of sensibilisation and have entered the phase of action, again, in every day life, not just on Saturday evening around candles. Limiting an energy saving action to one hour on Saturday night is nearing hypocrisy.

Second, I remember comments from professionals of the electric industry that expressed concerns as to the environmental effects of such inpredictable variations in load consumption at large scale. Those professionals may not be in favour of such events for economic reasons, and drop in consumption is certainly a manageable challenge for grid operators, which will act almost like in a blackout recovery. Mediatisation surrounding the event certainly helps operators anticipate... but still, do we need to put the electricity network under stress to send a message instead of reducing every day our consumption? Similarly, what is the effect, at the end of the event, when everybody switches on the light in synchronisaton? Where goes on the grid the lost production of electricity that continues to happen during the earth hour?

If you really need inspiration, you can try to apply the energy savings measures described by, e.g.: Energy Savings Trust UK; ADEME compaigns in France; Norwegian ministry of Energy advices on energy savings (+ see videos on NRK website). On EU policy measures, see the recent Energy Efficiency Plan 2011 of the European Commission.

ENOVA Resultatrapport 2010 er Publisert

ENOVA har publisert i dag sin resultatrapport for 2010. Rapporten er tilgjengelig HER (i pdf versjon) eller fra websiden. Den blir kort kommentert på denne bloggen.

Alcoa case: EU Commission Refers Italy to Court for Non-Recovery of Illegal State Aid (Preferential Electricity Tariff)

The European Commission has announced today that it will refer Italy to the European Court of Justice (ECJ) in the Alcoa case for not having recovered the unlawful state aid following the Commission's decision of 19 November 2009.

The facts

The Alcoa case concerns the grant of subsidy to Alcoa in the form of preferential electricity tariff, the direct beneficiaries being two aluminium smelters in Sardinia and Veneto. See details of the facts in previous post from Sept. 2010 here and a similar case in Greece (see post from Jan. 2010 here). The Commission considered that the preferential tariff represented an unfair advantage in favour of the undertaking. The aid was received from January 2006 to January 2007, and the amount to be recovered near EUR295 million.

Recovery of Unlawful State Aid and Undergoing Judicial procedure

Alcoa appealed the Commission's decision before the ECJ, asking for interim measures (Case T-177/10, see previous post on the appeal here). In July 2010, the General Court first dismissed Alcoa's legal action and its request for interim measures. Alcoa introduced an appeal which is under examination.

Besides the undergoing judicial procedure, Italy has the obligation to recover the aid within the deadline decided by the European Commission (See Art. 14, Regulation No. 659/99). The reason is, as put by the European Commission, that delays in the recovery of unlawful subsidies maintain the distortion of competition created by the state aid. Where a Member State does not implement the recovery decision within the prescribed time, the Commission (or any other Member State) refer the matter to the Court of Justice pursuant to Article 108.2 TFEU. Where the Member State still does not comply with the ECJ judgment, the Commission can then require the Court to impose penalty payments to this State pursuant to Article 260 TFEU.

References:

Press release, European Commission, IP/11/352;

Press release, European Commission, IP/09/1750;

Notice on the implementation of decisions ordering the recovery of unlawful or incompatible aid, + IP/07/1609.

Extraordinary Energy Council Meeting of 21 March 2011: the Key "Messages"

The Hungarian presidency of the European Union (EU) called upon an extraordinary Energy Council meeting on 21 March 2011, in order to discuss "recent international developments and their impact on world energy markets and the EU energy sector." The meeting was primarily motivated by the consequences of the political movements in North Africa as an important energy supplier to Europe, as well as the consequences of the nuclear accident at Fukushima, Japan. Commissioner Oettinger addressed the Energy Council, and the Council will then "exchange views" as to the response to be given at EU and Member States' level.

In the list of "messages" that the Presidency highlighted at the end of the discussions are:

as regards political movements in North Africa:

• "member states have so far been able to cope with the consequences for the gas and oil markets";
• "however, the Council stressed the need to keep these markets and their impact on the EU under close watch, including as regards price developments";
• "the Council underlined the need to fully implement the orientations agreed for the new 2020 strategy";
• "when conditions permit, the EU partnership with southern countries should be taken forward";

As regards nuclear safety:

• "the priority is to ensure that the highest standards are in force; improving safety is a continuing process";
• "the Council welcomed voluntary steps taken by national authorities and industry operators regarding the review of the safety of nuclear facilities";
• "there is a shared willingness to launch a process for defining a comprehensive risk and safety assessment ("stress test") of nuclear plants in Europe":
• "the importance of transparency regarding both the outcome of this assessment and measures taken by member states at national level was underlined";
• "member states and the Commission invited ENSREG (European Nuclear Safety Regulators Group) and other relevant bodies to define the scope and modalities of such tests, making use of the available expertise and in due course of the lessons to be learnt from the recent accident";
• "the Council took note of the possible areas (flood risks, seismin risks, back-up systems, emergency procedures) that could be the basis for this assessment";
• "the Council underlined the need to involve neighbouring third countries in a similar safety and risk assessment for existing and future plants."

References:

• Website of the Council;
• Press release, Extraordinary Council meeting, Transport, Telecommunications and Energy, Energy Items, Brussels, 21 March 2011.

Picture: (c) Council of the European Union

Accident Nucléaire de Fukushima: Les Instances Parlementaires Francaises Débattent

Hier, 16 mars 2011, s'est tenue à l'Assemblée Nationale une réunion conjointe sur la crise nucléaire au Japon. La réunion avait lieu entre l'Office parlemenatire d'évaluation des choix scientifiques et technologiques, la Commission du développement durable et de l'aménagement du territoire et de la Commission de l'économie, du développement durable et de l'aménagement du territoire du Sénat.

La vidéo intégrale de la réunion est disponible ICI (onglet "Commissions"; 16 mars - "Crise nucléaire Japon").

Intervenants: Mme N. Kosciusko-Morizet, ministre de l'Ecologie, du développement durable, des transports et du logement; M. A.-C Lacoste, président de l'autorité de sûreté nucléaire; M. J. Repussard, directeur général de l'institut de radioprotection et de sûreté nucléaire; M. B. Bigot, administrateur général du Commissariat à l'énergie atomique et aux énergies alternatives; Mme A. Lauvergeon, présidente du directoire d'Areva; M. H. Proglio, PDF d'EDF; M. H. Revol, président du Haut Comité pour la transparence et l'information sur la sécurité nucléaire (HCTISN).

EFTA Surveillance Authority Validates a NOK 346.4 million State Aid to Troms Kraft Produksjon AS for a Windpark Project

The EFTA Surveillance Authority (ESA) has today given its aproval concerning a state aid granted to Troms Kraft Produksjon AS and concerning the construction of an onshore windpark (18 turbines, 138 GWh) in Fakken at Vannøya (project info here and here), granted by the Norwegian authorities through the Norwegian Energy Fund Scheme (managed by ENOVA).

The measure was notified to ESA in June 2010 under the State Aid Guidelines for environmental protection. The high amount of the aid, NOK 346.4 million (EUR 42 million), required a detailed assessment. According to the press release*, the high investment costs required for putting on line the windpark project justified the approval of the aid under the Guidelines. The benefits represented by the increased production of renewable energy consecutive to the project counter-balances the negative effects on competition, which themselves are considered to be "limited."

As sum up by ESA in general terms:

"The aid is proportional as it is limited to the aid necessary to trigger investments in the wind park. The aid also provides an incentive effect since the project would not be commercially viable without the aid. Finally, the market power of Troms Kraft is less than 1% and hence the structure of the market for electricity production is unlikely to be altered by the grant of the aid."

The granting of direct state aids of such amounts are expected to be reduced considerably after the entry into force of the green certificates scheme on 1 January 2012 (see previous post). The regime of the Norwegian Energy Fund Scheme has been approved by ESA in 2006 (Decision No. 125/06/COL) and renewed once in 2010 (Decision No.486/10/COL).

* The decision is not yet made available until confidentiality clearing.

Omorganisering av Statkraft for En Bedre Konkurranse?

Konkurransetilsynet kom slutten av februar med en anbefaling om Statkraft som må sees i sammenheng med en rekke tiltak knyttet til konkurransen i det norske kraftmarkedet. Anbefalingen ble gitt i forbindelse med høringsbrev av 17. desember 2010 fra Olje- og energidepartementet (OED) om en rapport utarbeidet av Eksperutvalget om driften av kraftsystemet ("Flere og riktigere priser - Et mer effektivt kraftsystem"). Konkurransetilsynet pekker på offentlig eierskap som en klar utfordring for konkurransen på engroskraftmarkedet.

Statkraft spiller en dominerende rolle på engrosmarkedet. Konkurransetilsynet pekker på her at de offentlige aktørene i markedet 'er vevd sammen i et nett av utbredt direkte og indirekte eierskap mellom selskapene.' Tilsynet understrekker her at 'I tillegg til minoritetseierskap og krysseierskap mellom aktørene, noe som fører til at konsentrasjonen øker ytterligere, er mange av vannkraftverkene eid i felleskap mellom to eller flere selskaper.'

Blant de tiltakene som Konkurransetilsyner foreslår er:

• å splitte opp det offentlige eierskapet med å dele Statkraft;
• å begrense antal felleseide kraftverk;
• å dele inn det norske kraftmarkedet i flere mindre områder (f. eks. 5), såkalt "noder", følgt av innføring av en nodeprismodell. Dette ble anbefalt i rapporten "Flere og riktigere priser - Et mer effektivt kraftsystem" i november 2010 (tilgjengelig HER).

Referanser:

• Pressemelding, Konkurransetilsynet, 9. mars 2011;
• Svar på Høringsuttalelsen, Konkurransetilsynet, Februar 2011;
• Om engros kraft markedet, jf. rapporten "Konkurranse i Norge", Konkurransetilsynet, 2009;
• Om konkurranse på kraftmarkedet og eierskap, se rapporten om Krysseierskap "Ownership relations and cooperation in the Norwegian power market", Konkurransetilsynet, 2006.

Report on Full Scale Deployment of CCS Technology in Norway (Fullskala CO2 Håndtering)

On 4 March 2011, the Norwegian government adopted a report to the national parliament (Stortinget) on the full-scale deployment of carbon capture and storage (CCS) technology. The report (Stortingsmelding nr.9 (2010-2011), available in Norwegian HERE), is both an assessment and a roadmap. It presents the efforts at national and international level up to now. At national level, it reviews in details the status of the Mongstad technology centre and the way towards full scale deployment (Chapter 3). Chapter 4 of the report reviews aspects related to transport and storage of CO2. It insists on the Norwegian state's responsibility for transport and storage from Mongstad. The involvement of Gassco, Gassnova and Statoil are also reviewed in that context. Chapter 5 looks at the state-of-play of the technology, knowledge and competences. The end of the report is dedicated to international experiences, both in terms of international cooperation and national experiences, and to the economic and administrative consequences of CCS projects. The report is mostly a policy document with few legal issues examined, but it gives an up-to-date analysis of the Norwegian policy and its achievements so far.

References:

• press release, Norwegian Ministry of Petroleum and Energy, 04.03.2011.
  Summary in English, HERE.

Conditions d'Achat de l'Energie Solaire en France: Nouvel Arrêté Publié au JORF

Publiés au Journal Officiel de ce jour (JORF No.0054 du 5 mars 2011):

• Arrêté du 4 mars 2011 fixant les conditions d'achat de l'électricté produite par les installations utilisant l'énergie radiative du soleil telles que visées au 3' de l'article 2 du décret no. 2000-1196 du 6 décembre 2000;
• Arrêté du 4 mars 2011 portant abrogation de l'arrêté du 31 août 2010;
• Délibération de la Commission de Régulation de l'Energie du 3 mars 2011 portant avis sur le projet d'arrêté.

Official Nomination of the Committee on the Future of Norwegian Energy Policy (Energiutvalget)

On 13 December 2010, the Norwegian Ministry for Petroleum and Energy announced the forthcoming establishment of an Energy Committee (Energiutvalget) that would draft proposals as regards Norway's energy policy towards 2030 and 2050 (see previous post with detailed mandate). On 4 March 2011, the King has officially nominated the Committee and its members. A shorter text of the mandate is available here (builds on the previous mandate description and will not be repeated. See previous post). The list of the 15 members of the committee is available here (including short bio). The Energy Committee must submit its assessment to the ministry by 1 March 2012.

Reference: press release, Ministry for Petroleum and Energy, 04.03.2011.

Third Energy Package: EU Commission Flexible on the 3 March 2011 Deadline of Transposition

EU Member States must transpose the third energy package (link) by 3 March 2011, for most of the provisions contained in: Directive 2009/72/EC on the internal market in electricity, and Directive 2009/73/EC on the internal market in natural gas. The provisions of Regulation (EC) No. 714/2009 on conditions for access to the network for cross-border exchanges in electricity, and of Regulation (EC) No. 715/2009 on conditions for access to the natural gas transmission networks also apply from 3 March 2011. Finally, Articles 5 to 11 of Regulation (EC) No. 713/2009 establishing the Agency for the Cooperation of Energy Regulators (ACER) apply from 3 March 2011. ACER will be officially inaugurated in Ljubljana, Slovenia, today (see, press release European Commission).

Meanwhile, the European Commissioner for Energy, Günther Oettinger, speaking at the occasion of the Energy Ministers Council on 28 February (see, video press conference), made clear that 3 March 2011 "is not an absolute deadline." The objective is to first complete the implementation of the second energy package, and then the one of the third energy package. On the implementation of the third energy package, the Commissioner underlined that it has been a progressive process since the adoption of the European legal texts. The European Commission is following the adoption of implementation measures by Member States, which it deems to be "on the right track." Once the national legislations will be passed, the Commission will monitor implementation and, when necessary, start infringement procedures. This means in practice that the Member States are given the necessary time to adopt their national implementation measures, but that the Commission will follow closely the process in the perspective of the completion of the internal market in energy by 2014.

The same day, the Commission published a "non-paper" on The internal energy market - Time to switch into higher gear (available HERE). The Non-paper underlines the positive outcomes of the internal energy market before poiting out the shortcomings: lack of interconnection capacity; lack of fluid transmission if energy within and between some countries, in particular in for electricity in Central Europe; gass systems remain relatively isolated and hinders spreading the benefits of access to cheap LNG resulting in a difference of commodity price; barries to cross-border trading remain; powers and independence of the energy regulators must be reinforced; national market remain "highly concentrated with little evidence of new entry of independent suppliers"; the decrease in wholesale prices has not automatically benefited retail consumers, in particular for electricity; regulated prices still exist, having negative effects on market entrance capacity; retail prices diverge widely in Europe; consumer choice is still weak.

Based on this assessment, the Commission identifies in the non-paper three lines of action: market opening; upgrading and integrating the networks; empowering consumers (for details, see the non-paper). Once again, the actions identified are not new. But the details given under these three actions provide a glimpse of the contain of the proposals to come in the short-run for the completion of the internal market in energy by 2014.

Picture: (c) Council. Press conference, Council Transport-Telecommunications and Anergy, 28 February 2011, Commissioner G. Oettinger and Hungarian Minister for National Development (EU Presidency) T. Fellegi.

EFTA Surveillance Authority Backs the Norwegian Power Guarantee Scheme

The Surveillance Authority of the European Free Trade Agreement (ESA) has adopted today a positive decision as regards the Norwegian guarantee scheme for purchase of electricity on long term contracts. ESA is of the opinion that the scheme "does not entail any state aid" and is conform to the Guidelines on state guarantees.

Here is an abstract of the press release from ESA (HERE), the publication of the final decision waiting confidentiality clearing:

• The scheme enables certain power intensive industries to benefit from a state guarantee for their payment obligations when entering into long term power contracts. The guarantee can cover up to 80% of the payment obligations of contracts lasting from 7 to 25 years. The scheme will be managed by GIEK (Garanti-instituttet for eksportkreditt).
• The calculation of the guarantee premiums will be made on a case-by-case basis. GIEK will assess the different risk factors, such as the profitability and solidity of the buyers and future development of power markets. GIEK will also require remuneration for the capital and coverage of its administrative costs. In addition, GIEK may require different types of collateral.
• Assessment of the risks involved is challenged due to the absence of corresponding long term guarantees in the financial market today. Nevertheless, the Authority considers that the model proposed by the Norwegian authorities provides for a reaslistic assessment of the risks. The model will in all likelyhood secure that the premiums charged will be in line with market pricing and that the scheme will be self-financing in the long run and, consequently, operate without state aid. The model for calculation of the premiums will be reviewed at least once a year to ensure that the scheme will be self-financing in the long run. This will also be the subject of an annual review by an independent expert.