24 June 2010

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Energy: Commission requests 20 Member States to implement and apply Single Market rules without delay

The European Commission has decided to send 35 separate requests to 20 Member States to implement and apply in full various aspects of EU legislation to create a Single Market for gas and electricity. These rules aim at increasing the capacity and transparency of gas and electricity markets. A properly functioning, well regulated, transparent and interconnected market, with market price signals is crucial for ensuring competition and security of supply. An efficient and fully functional EU Single Market in energy will give consumers a choice between different companies supplying gas and electricity at reasonable prices, and it will make the market accessible for all suppliers, especially the smallest and those investing in renewable energies. It will also help the EU to recover from the economic crisis. The Member States in question now have two months to respond to the requests, which take the form of 'reasoned opinions' under EU infringement procedures. In the absence of satisfactory responses from the Member States concerned, the Commission may refer them to the EU's Court of Justice.

The Commission is sending a total of 35 reasoned opinions to the following 20 Member States: Austria, Belgium, Bulgaria, the Czech Republic, Germany, Spain, France, Greece, Hungary, Ireland, Italy, Luxembourg, The Netherlands, Poland, Portugal, Romania, Slovenia, Slovakia, Sweden and the United Kingdom.
 

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The European Commission promotes integration of the electricity markets of the Maghreb

The Algerian, Moroccan and Tunisian energy ministers met EU Energy Commissioner Günther Oettinger in Algiers this week to step up the process to integrate the electricity markets of the Maghreb, the first step towards full integration of these markets into the European market.

The signature of a Ministerial Declaration also defines a concrete action plan for the next few years, as well as the principle of an annual meeting of ministers to monitor progress.

The reforms of the electricity sector launched in the three countries will progressively integrate the regional dimension and enable the trade and transport of electricity between these countries. This process is favourable for investment in the electricity sector, in particular projects relating to renewable energy such as the solar plans for each country and private initiatives such as DESERTEC.
 

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Oil platforms: Commission convenes second safety talks with industry

Energy Commissioner Günther Oettinger and Environment Commissioner Janez Potočnik will meet representatives of oil and gas companies and national surveillance authorities on 14 July 2010. The aim of the meetings is to discuss whether EU legislation should be reviewed in the light of the accident in the Gulf of Mexico.

The Commission is currently analysing the existing EU and national legislation and will complete its assessment on this basis. Depending on the results, Commissioner Oettinger will come out with new legislative and policy proposals this autumn.

 

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More: European Maritime Safety Agency

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Russia-Belarus gas dispute: Commission strongly concerned about gas cuts in Lithuania

Energy Commissioner Günther Oettinger is strongly concerned about cuts in gas supply to Lithuania, following the Russia-Belarus gas dispute. Lithuanian authorities confirmed that Russian gas supplies via Belarus decreased by around 50 percent on 23 June.

Three countries can be potentially affected by the gas dispute: Lithuania, Poland and Germany. In the case of Poland and Germany, Russian gas could be delivered via Ukraine. This is not possible for Lithuania which depends 100 percent from Russian gas delivered by Belarus. Latvia is expected to be able to deliver gas to Lithuania without any problems for one week.

6.25% of gas consumed in the EU is delivered via Belarus and could potentially be affected by the dispute.
 

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Background

Security of gas supplies: trialogues end with an informal agreement

 

Te Parliament's Industry Committee and the Spanish Presidency reached this week an agreement on a draft legislation that lays down new requirements for plans to offset any serious disruptions to gas supplies from third countries.

The proposal, prompted by the 2008 and 2009 gas crises, when supplies of Russian gas through Ukraine to the EU were disrupted by disputes between Moscow and Kiev, constitutes a draft regulation to remedy a lack of co-ordination and interconnected infrastructure among EU Member States.

While the compromise text still needs to be formally approved by the Council and the Parliament before entering into force, a brief overview of the informal agreement is provided hereunder:

 

1. Preventive action plans:

Member states will need to ensure that even if their biggest gas infrastructure fails, the remaining infrastructure is capable of meeting total daily gas demand on a day of "exceptionally high demand" (which, statistically, happens once every 20 years).

National authorities should also comply with an infrastructure standard, notably by additional storage capacities, introducing reverse flows, ensuring connections to the integrated EU gas network and by breaking dependence on one single third country gas supplier.

2. Emergency measures:

 If an emergency should occur as result of a serious disruption or exceptionally high demand where market mechanisms can no longer ensure supplies, then the Member State will activate an emergency response.

The three main crisis levels are early warning, alert and emergency.

In the event of an emergency, plans must ensure that cross-border access to storage facilities and the flow of gas across borders are maintained.

3. EU emergency response:

 The European Commission may declare a "Union emergency" or a regional emergency at the request of at least two member states who have declared national emergencies.

4. Customer protection:

 The market mechanisms are the first and best line of defence against possible supply disruptions. Member State should base their preventive plans primarily on such measures, leaving non-market measures as a very last resort when the markets alone cannot solve a supply disruption.

Nevertheless, householders are, by definition, customers whose gas supplies are protected. Member States may declare additional protected customers, such as small and medium sized enterprises and essential social services, provided they do not represent more than 20% in the final use of gas.

Gas suppliers should ensure supplies to protected customers in the event of extreme temperatures during a seven day peak period and for 30 days of exceptionally high demand, during the coldest weather, or for 30 days in the case of infrastructure disruption under average winter conditions.

More: Security of supply of natural gas

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