A real lack of energy

Big ideas but many of the details were familiar.

What is the point of the European Council? It is a question some were asking after seeing the conclusions on energy and innovation. Although not short on big ideas – a single market for gas, electricity and brainpower – many of the details were familiar from existing strategies or laws. 

Should European leaders meet just to agree they will enforce the laws they have already signed up to? For the European Commission, the answer is yes. EU summits allow the Commission to keep up the pressure on member states to see through unpopular tasks, such as breaking up powerful energy monopolies. “All of our member states are subject to heavy lobbying by their own companies,” an EU official explained. “It is totally legitimate that the European heads of state [or government] get behind the objective that they stood for in the legislation.”

So to look for reams of new announcements from a Council may be missing the point. Some summits are like weddings, where leaders make a promise for the first time – for example, the 2007 European Council that set climate targets. Other summits are a chance for leaders to make a ritual renewal of their vows – less dramatic, but no less important. This Council was more of an anniversary. Governments pledged to have the single market working properly by 2014 – so “power and gas should be transported as easily throughout Europe as goods and services”, in the words of Günther Oettinger, the European commissioner for energy. This means respecting an interim deadline to separate companies generating power from those transmitting power by March 2012.

Promises were also renewed on improving energy efficiency and creating a low-carbon energy system, so as to cut greenhouse-gas emissions by up to 95% by 2050. However, green campaign groups and low-carbon businesses were left asking whether repeating promises was meaningful when the EU is only halfway on course to meeting its energy-savings goal.

Finance questions

Other difficult questions were left for another day. Leaders agreed that “major efforts” were needed to update Europe’s outdated energy infrastructure, by building interconnectors to transfer gas and electricity across borders, and by upgrading the electricity grid system to cope with a big influx of renewable energy.

No figure was put on this investment, although the Commission has estimated around €1 trillion is needed by 2020, mostly from private sources. EU leaders asked the Commission to report back with precise figures by June. But private investors have little incentive to build new facilities and pipelines in countries that are dependent on Russian gas, in the EU’s “energy islands” of the Baltic states and Slovakia.

This was a consensual Council, but the fault-lines of future disputes are evident. The Commission would like a sprinkling of public funds to help stimulate private investment and is studying financing options for energy projects. But a group of northern EU countries warned against hasty writing of EU cheques. Germany, Sweden and the UK do not explicitly rule out public finance, but they say the case still has to be proven.

Fact File

Innovation

Some innovation-policy watchers were disappointed that the European Council’s twice-postponed innovation discussion was eventually squeezed in at the end of a summit dominated by the eurozone crisis and events in Egypt. But Máire Geoghegan-Quinn was not unhappy. The European commissioner for research and innovation declared herself delighted with the conclusions, which were “very much at the upper end of our expectations”.

Days before the summit, Geoghegan-Quinn had warned that the EU faces an “innovation emergency”. On cue, EU leaders promised to cut red tape in European research funding, collaborate more on big projects and develop sources of venture capital for innovative start-up companies. They also promised to complete the European Research Area by 2014, a long-standing plan to make it easier for scientists to work anywhere in the Union. These ideas were not new, but getting agreement was important.

One national diplomat conceded that there was an element of “public relations” in the conclusions, but they were still important. Ministries and domestic media sat up and took notice when a policy came in the name of the prime minister, the official suggested.

The eurozone competitiveness pact drawn up by Nicolas Sarkozy and Angela Merkel offered some comfort to those seeking EU attention to Europe’s so-called “innovation crisis”. The plan contained an (as yet unspecified) target for spending on research, development, education and infrastructure. Pessimists might note that the EU already has a decade-old target on R&D spending that it has failed to meet (largely because the private sector has fallen short). But optimists may be encouraged that governments are thinking about how to raise their game, without prompting from the Commission.

Questions also linger about whether governments will accept an energy policy that confers additional rights on the Commission. An earlier proposal obliging governments to submit reports on any bilateral deals they make with non-EU countries did not survive long. The grand announcements that the summit had shifted Europe up a gear on international energy negotiations are not yet borne out by the facts.