The loss of competitiveness because of elevated energy costs is concentrated in a limited number of sectors. The cost of subsidising energy-intensive companies might be greater than the benefits. Continue reading »
Unlike Germany, France has not decided to phase out nuclear power. But it plans to close the Fessenheim nuclear power plant, in Alsace, ahead of schedule. It has also made a commitment to reduce this technology’s share in its future energy mix. Underpinning these decisions we find the same factors as in Germany: a party built around combating nuclear power; a more acute perception of nuclear risk in the aftermath of the Fukushima-Daiichi disaster; electoral competition; and political alliances which make allowance for risks as perceived by the general public, not as calculated by experts. Just as in Germany we shall see that decisions on targets and the exit schedule have been based mainly on approximation, without paying much attention to economic factors. Continue reading »
In Germany’s election campaign the attention going to the national energy transition plan is bafflingly low. Official Environment ministry reports however suggest that total costs of Energiewende could or might rise to 1000 billion euros by the late 2030′s if the program is maintained as present, and its targets are not cut back or shifted further into the future. Despite this, most German political parties have tacitly agreed to limit discussion of Energiewende and backpedal their criticism of this free-spending plan, for reasons that are much more than simply political.
Continue reading »
Notre Europe –Jacques Delors Institute is leading an in-depth study of the future of European energy policy based on a proposal made by Jacques Delors for a “European Energy Community”. It has the merit of having opened a European wingspan debate engaged with various stakeholders: public, private, NGOs, local, national and European. Solidarity plays a key role in a European Energy Community and may later be one of the drivers of the development of an EU-wide energy policy Continue reading »
State level regulators, like politicians, read the newspaper headlines, notice what is in their in-box and have a good sense of what their constituents like and dislike. This, more than anything else, explains why they seem reluctant to modify or nullify prevailing net energy metering laws even when they realize that the status quo may be unsustainable in the long-run. Continue reading »
Europe is often criticized for its lack of global energy policy. The three objectives towards 2020 let Europe fancy it had started to build its own policy but the energy and climate package was no more than a list of nationally implemented objectives. Giving no more than objectives, the text is another proof that energy policies are still largely considered as national issues in Europe. Such a supremacy left to the countries seems paradoxical given that the European Union forced the liberalization of electricity markets to end with national supremacy in energy policies. However, liberalizing the electric production and distribution was somehow the second step to build a European energy policy. The first step was connecting the national networks after World War II. In a way, liberalization of electricity production gave birth to new actors and therefore started to reorganize European territories. This is how EDF started to produce electricity out of France, but big companies are not the only new European actors.
The debate on the costs of nuclear power generation is fairly confusing. Some present electricity production using nuclear power as an affordable solution, others maintain it is too expensive. These widely divergent views prompt fears among consumers and voters that they are being manipulated: each side is just defending its own interests and the true cost of nuclear power is being concealed. Companies and non-government organizations certainly adopt whatever position suits them best. But at the same time, the notion of just one ‘true’ cost is misleading.
Continue reading »
Following the vote in the European Parliament, the Commission will not be able to quickly implement “backloading”, the point of which is to send a very short-term signal to the market pending further structural reforms. There still remains the question of what actions can be taken to revitalize the CO2 allowances trading system. Continue reading »
The PJM market has always been, and continues to be, a source of fascination to anyone interested in organized or competitive wholesale electricity markets. First, it is by far the largest such organized market operating in North America, among the largest anywhere in the world, with 182 GW of installed capacity and a large geographical footprint. Second, PJM was among the first to introduce a number of features, such as locational marginal pricing (LMP), now common place in other markets. Third, PJM has introduced and successfully operates a number of markets, including capacity markets, that are extensively studies by other market operators who believe such a feature may be an improvement to their own.
Since the Copenhagen conference of December 2009, the actors involved in climate negotiations seem be engaged in a game of mistigri, in which everyone is in a hurry to pass on any card that exposes them to the slightest commitment. The overall result is that deadlines are being pushed back, and the prospect of an international agreement coming into force from 2020 now seems optimistic in the extreme. The economic crisis has accentuated this turning away from the climate issue, or at least its decline in policy makers’ scale of priorities. A curious semantic shift has accompanied this phenomenon: there is much less talk of global warming, while the media have turned their attention to the concept of energy transition. This shift is not innocuous, and may lead, if this novel concept is not defined more rigorously, to a justification of our collective resignation in the face of climate risk.
Continue reading »