Research

The School carries out applied research with the purpose of developing economically, legally, and socially-sound regulation and policy, using a multidisciplinary approach.

Proposal for reviewing the Regulation on trans-European Networks for Energy (TEN-E) : assessment and recommendations

Energy networks play an essential role in enabling competition, thus improving energy affordability, and in supporting decarbonisation of energy demand and security of supply....

Authors
Ronnie  Belmans Alberto Pototschnig ECSM
Article
Loss and damage of climate change : recognition, obligation and legal consequences
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Technical Report
A study on the relevance of consumer rights and protections in the context of innovative energy-related services
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Executive Education

We offer different types of training: Online, Residential, Blended and Tailor-made courses in all levels of knowledge.

Policy Events

A wide range of events for open discussion and knowledge exchange. In Florence, Brussels, worldwide and online.

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Discover more initiatives, broader research, and featured reports.

Lights on Women

The Lights on Women initiative promotes, trains and advocates for women in energy, climate and sustainability, boosting their visibility, representation and careers.

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Forum

FSR Global Forum

From 25 March 2019 to 28 March 2019

The FSR Global Forum is a 4-day event fostering practice-oriented solutions on key aspects of the world energy transition. It provides a platform for multi-stakeholder engagement to facilitate transnational knowledge exchange.

It brings together 100 representatives from government agencies, regulatory bodies, energy companies, energy utilities, development organisations and academics from across the world.

The Forum develops around 12 knowledge spaces to facilitate interactive discussions and digitally maps the key insights of each session. The topical issues addressed have a special focus on Latin America, Africa and Asia.

Participation to the event is by invitation only.

Read more information in the FSR Global Forum website

Follow us on twitter #FSRGlobalForum

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Online Event

Sustainable Consumption in the World Energy Transition

18 March 2019

Join us on the third online event leading up to the FSR Global Forum discussing Sustainable Consumption in the World Energy Transition.

The accomplishment of the world energy transition for a low-carbon economy imposes challenges on public authorities, but also civil society and consumers. Besides the universal access to clean and affordable energy, consumers and industrial customers are means to the energy transition when they respond and engage in consumption patterns to consume less and better energy, self-generate, or become prosumers. These goals are at the core of the United Nation SDG #12, which trickle the issue of Sustainable Consumption.

A wide range of techniques have been developed to bring consumption to more sustainable levels: information disclosure policy though smart-meters, energy label and eco-design; energy efficiency of residential and non-residential buildings; tax and regulatory incentives for the use of electric vehicles among others. Until now, these techniques remained scattered across different areas of law, with the resulting challenge for anyone interested in their forms and operation. The online debate aims to touch open the issue of sustainable consumption.

This online debate will discuss the following issues:

  • What does the UN Sustainable Development Goal #12 on Sustainable Consumption mean and how does it interact with SDG #7 on affordable and clean energy?
  • What are the main legal barriers that preclude consumers to engage in more sustainable patterns such as demand-response?
  • What are the legal techniques that have been developed to bring consumption to more sustainable levels in energy markets and other sectors?

An open discussion will follow.

Speakers:

Alberto do Amaral Júnior | Professor at the University of São Paulo (Brazil).

Tiago de Barros Correia | Former-Director of ANEEL (Brazilian Electricity Regulatory Authority)

Miguel Vazquez | Part-time Professor and Head of Florence School of Regulation Energy Innovation

Moderator:

Lucila de Almeida | Florence School of Regulation

 

 

The online debate aims to pre-launch the Springer book entitled ‘Sustainable Consumption: the right to a healthy environment’ of our Research Associate, Lucila de Almeida, together with Alberto do Amaral Junior (University of São Paulo) and Luciane Klein Vieira (University of Buenos Aires and UNISINOS). Tiago de Barros Correia is one among the more than 30 contributors and writes on the auction design to procure energy efficiency measures.

 

About the FSR Global Forum

The FSR Global Forum is a 4-day event fostering practice-oriented solutions on key aspects of the world energy transition. It provides a platform for multi-stakeholder engagement to facilitate transnational knowledge exchange.

It brings together 100 representatives (by invitation only) from government agencies, regulatory bodies, energy companies, energy utilities, development organisations and academics from across the world.

The Forum develops around 12 knowledge spaces to facilitate interactive discussions and digitally maps the key insights of each session. The topical issues addressed have a special focus on Latin America, Africa and Asia.

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Online Event

Energy Access and the Road Ahead

11 March 2019

Universal access to clean and modern energy is one of the top energy challenges of our time.

Significant progress to provide such energy access has been achieved in the past years. However, based on the current trajectory, the IEA estimates that around 674 million inhabitants will continue to lack access to electricity in 2030. It is therefore imperative to ‘think big’, involve all the relevant stakeholders and remove barriers to massive electrification business models.

The 2nd online debate leading up to the FSR Global Forum discusses the following issues

  • What are the main barriers to massive electrification business models? How to remove them to increase energy access?
  • Is a “utility-like” business model the most adequate long-term approach for electricity supply to the population that lacks acceptable electricity access?

Speakers:

Laura Cozzi |Deputy Head – Office of the Chief Economist of the IEA

Salvatore Vinci | Deputy Director, Country Support and Partnerships Division – IRENA

Praveer Sinha | CEO & Managing Director – Tata Power

Moderator:

Ignacio Perez Arriaga | Professor – FSR, MIT and UPComillas

An open discussion will follow.

Watch the debate recording:

 

About the FSR Global Forum

The FSR Global Forum is a 4-day event fostering practice-oriented solutions on key aspects of the world energy transition. It provides a platform for multi-stakeholder engagement to facilitate transnational knowledge exchange.

It brings together 100 representatives (by invitation only) from government agencies, regulatory bodies, energy companies, energy utilities, development organisations and academics from across the world.

The Forum develops around 12 knowledge spaces to facilitate interactive discussions and digitally maps the key insights of each session. The topical issues addressed have a special focus on Latin America, Africa and Asia.

Visit the Forum website

 

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Seminar

Trust in the Single Market?

02 May 2019

“Trust in the Single Market?” is a Side Event at the 2019 State of the Union – 21st Century Democracy in Europe, European University Institute, Florence, discussing the case of the EU Emissions Trading System

Jointly organised by FSR Climate (European University Institute) and the European Association of Environmental and Resource Economists (EAERE)

Chairing: Simone Borghesi, Director, FSR Climate, EUI;  Jos Delbeke, former Director-General for Climate Action,, European Commission, Professor, School of Transnational Governance, EUI

Watch the recording of this side event:

Presentations

Trust in the Single Market? The case of the EU Emissions Trading System – Introduction to the event, Simone Borghesi

Unilateral action, expectations and credible commitment, Ottmar Edenhofer

Do we trust carbon pricing?, Herman Vollebergh

Download the programme

Trust in the Single Market? The case of the EU Emissions Trading System

Carbon pricing is widely regarded as a key instrument to achieve the emission reduction targets set by the Paris Agreement. Since the introduction of the European Emission Trading System (EU ETS) in 2005, carbon pricing has grown extensively around the world. The EU ETS is the result of a complex legislative process involving the governments of 31 participating countries, thus providing one of the most interesting examples of democratic participation of EU countries in the design of a EU crucial policy and in the creation of a single market in the EU.

Since its adoption, the EU ETS has faced a number of challenges, including a substantial price fall with allowance prices getting below 5€/ton of CO2 during the economic recession. This has urged European institutions to implement a series of revisions of the system. As a result, after years of low carbon prices, in which trust in the EU ETS was low, the price of the European allowances has risen remarkably following the announcement of the reform of the EU ETS for Phase IV (2021-2030), which was passed in 2018. This confirms the crucial role that expectations can play in anticipating the policy when this is perceived as sufficient stringent, credible and long-run.

The following questions will be addressed by the event:

  • What is the current level of trust by participants and the public opinion in the EU ETS?
  • What can be done to further support the credibility of the system and enhance trust in the single market in the context of climate policy?
  • How can transparency and MRV (Measurement, reporting and verification) contribute to build trust in climate policy measures in general, and in the EU ETS in particular?
  • How can we trigger mutual trust across countries and facilitate the ongoing negotiations on CORSIA and on Article 6 in the Paris Agreement?
  • How can scholars and research better bridge with Policy Makers to enhance trust in Climate Policy measures?

FSR Climate, together with the Policy Outreach Committee of EAERE and in collaboration with the School of Transnational Governance of the European University Institute, organises this session to promote a more integrated dialogue between academia and the policy world, providing advice and support to EU policy makers and institutions in designing policy interventions. The event intends to continue the policy dialogue carried out by FSR Climate under the LIFE SIDE project (co-funded by the LIFE Programme of the European Union) concluded at the end of 2018, which supported European policy makers with the design and implementation of the new EU ETS legislation.

Invited speakers

Carlo Carraro, Professor (University of Venice), President European Association of Environmental and Resource Economists and Vice-Chair of IPCC Working Group III

Ottmar Edenhofer, Director and Chief Economist, Potsdam Institute for Climate Impact Research, Director, Mercator Research Institute on Global Commons and Climate Change, Professor, Technische Universität Berlin

Hermann Vollebergh, Professor of Economics and Environmental Policy, Tilburg University, and Senior Research Fellow, PBL Netherlands Environmental Assessment Agency

Martin Weitzman, Professor of Economics, Harvard University Center for the Environment

 

Roundtable panelists

 

Dominique Bureau, General Delegate of the Economic council for sustainable development, Ministry of Ecology, Sustainable Development and Energy, France

Ben Groom, Grantham Research Institute on Climate Change and the Environment, London School of Economics, London, UK

Xavier Labandeira, Director of Economics for Energy, Spain, and Department of Applied Economics, University of Vigo, Spain

Aldo Ravazzi , Chair OECD-WPEP (Working Party on Environmental Performance Country Reviews), President Green Budget Europe, and Chief Economist, DG Sustainable Development, EU&Global Affairs – TA Sogesid, Italian Ministry of Environment

 

Speakers & panelists bios 

 

climate SoU side event 2019Dominique Bureau is General Delegate of the Economic Council of the French Ministry of Ecology and he chairs its Green Tax Commission.  He is also Chairman of the Public Statistics Authority and lecturer at École Polytechnique. He started his career with the Finance Ministry. Then he has been in charge of the Economic and International Affairs department for the Ministry of Transportation, after creating the Economic department at the Environment Ministry. He is member of the scientific committees of La Fabrique de la Cité, Grand Paris Express and National Institute for agronomic research. He is also member of the Board of the French Association for Resources and Environmental Economics.

 

COP online debateCarlo Carraro is President Emeritus and Professor of Economics at Ca’ Foscari University of Venice. He holds a Ph.D. from Princeton University. He was President of the University of Venice from 2009 to 2014.  He is President of the European Association of Environmental and Resource Economists (EAERE) and member of the Bureau of the Intergovernmental Panel on Climate Change (IPCC). He is also Strategic Advisor of the Euro Mediterranean Centre for Climate Change (CMCC), a Fellow of the Association of Environmental and Resource Economists (AERE) and Co-Chair of the Green Growth Knowledge Platform Advisory Committee. He is President of H-Farm Education and the HforHuman Foundation. He is also Scientific Director of the Fondazione Nord Est and a Research Fellow of CEPR, London,  CESifo, Munich and CEPS, Brussels. His blog is www.carlocarraro.org

 

Ottmar Edenhofer is Director of the Potsdam Institute for Climate Impact Research, Professor for the Economics of Climate Change at the Technical University Berlin as well as founding director of the Mercator Research Institute on Global Commons and Climate Change. He is a member of the German National Academy of Sciences Leopoldina and the National Academy of Science and Engineering acatech. Edenhofer has published numerous articles in leading journals and authored various books. From 2008 to 2015 he served as Co-Chair of Working Group III of the IPCC, shaping the Fifth Assessment Report on Climate Change Mitigation substantially, which has been considered a landmark report and provided the scientific basis for the Paris Agreement.

 

bio side event climate 19 SoUBen Groom is Professor of Environment and Development Economics at the Department of Geography and Environment, London School of Economics and Political Science. He is also an associate of the Grantham Research Institute on Environment and Climate Change. His research has focused on the welfare analysis of public policies that have long-term welfare effects. In particular he has worked on the determinants of the social discount rate (SDR) and empirical measures of intergenerational and intra-generational fairness. At present he is working on several projects, looking at: the impact of different positions on intergenerational fairness on climate change policy; devising a new measure of economic performance that internalises inequality aversion; empirical measures of inequality aversion over environmental quality. Pr Groom’s work has fed into advice for international organisation such as the World Bank, the OECD, the Asian Development Bank and the WWF. He has also advised government in the UK, USA, Norway France, China and Pakistan on various aspects of environmental policy.

 

SoU side event climate 2019Xavier Labandeira is Professor of Public and Environmental Economics at the University of Vigo, Spain. In 2014-2017 he was the Director of the Florence School of Regulation Climate at the European University Institute, Italy, and in 2007-2009 he was in charge of the FEDEA Chair on Climate Change Economics. He is currently the director of Economics for Energy, a private research centre specialising in the analysis of energy issues. He is a member of the UN Intergovernmental Panel on Climate Change (IPCC) for the elaboration of its Fifth and Sixth Assessment Reports. Since 2018 he has been a member of the EAERE’s Policy Outreach Committee. 

 

 

bios SoU climate side event

Aldo Ravazzi Douvan is Chief Economist, at DG Sustainable Development, EU & International Relations, Italian Ministry of Environment – Sogesid TA, President of the OECD Committee on Environmental Performance Country Reviews and Professor, Environment Global Governance, U. Tor Vergata Roma.  He is also Technical Secretary for the Italian Observatory for Sustainable Finance, the Italian Natural Capital Committee and the Italian Catalogue of Environmentally Harmful and Friendly Subsidies. Ravazzi is President of Green Budget Europe (network of experts on Ecological Tax Reform and Greening Budgets) and Vice-President of Plan Bleu, one the Regional Activity Centres of the Mediterranean Action Plan of United Nations Environment Programme (UNEP), put in place by France in 1977. He was coordinator for the G20 Peer Review of Fossil Fuel Subsidies for Italy 2018 and was President of the OECD Committees on Environmental taxation and Biodiversity, Water & Ecosystems.

 

bios SoU climate side event

Herman Vollebergh is professor of Economics and Environmental Policy at Tilburg University (Department of Economics, Tilburg Sustainability Centre and CentER) and Senior Research Fellow at the PBL Netherlands Environmental Assessment AgencyHis current research covers a broad range of topics including the design and effects of market based incentive mechanisms, like taxation, subsidies and tradeable permits in the energy or waste market, (environmental) cost-benefit analysis, long run relationship between emissions and income, and the effect of environmental policy on technological change. Finally, he is strongly involved in applying his academic work to the policy community including the OECD, European Union and the Dutch government.

 

Martin L. Weitzman is Professor of Economics at Harvard University. Previously he was on the faculties of MIT and Yale. He has been elected as a fellow of the Econometric Society and the American Academy of Arts and Sciences. He has published widely in many leading economic journals and written three books. Weitzman’s interests in economics are broad and he has served as consultant for several well-known organizations. His current research is focused on environmental economics, including climate change, the economics of catastrophes, cost-benefit analysis, long-run discounting, green accounting, biodiversity, and comparison of alternative instruments for controlling pollution.

 

 

 

 

fsr climate side event 2019

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Online Event

The GB Capacity Market Standstill

17 April 2019

In the “The GB Capacity Market Standstill” webinar, we will debate the reasoning of the GC, assess the repercussions of the judgment and current state of the market, and consider the next steps for the EC and the GB power market

60 minutes of free-flowing debate among panellists and 30 minutes of Q&A between panellists and live online audience. Opening 5’ will give a brief summary of the situation

 

Investigating the Impact of the Tempus State Aid Judgment

Speakers:

  • Leigh Hancher | Florence School of Regulation (RSCAS; EUI); Tilburg University – Moderator
  • Jacques Derenne | Sheppard Mullin, Professor of State aid law at the Liège University and the Brussels School of Competition – The specific State aid issues (Jacques Derenne is acting on behalf of Tempus before the EU courts) (confirmed)
  • Dan Roberts | Frontier Economics – An economist’s perspective and an overview of the impact on the UK market (confirmed)

Register here

Abstract

On 15 November 2018, the General Court of the European Union issued a judgment on Case 793/14 Tempus Energy Ltd and Tempus Energy Technology V Commission, annulling the Commission’s original State aid decision to approve a capacity mechanisms scheme for Great Britain. The General Court ruled that the Commission should have initiated the formal investigation procedure before adopting a decision. This judgment renders aid granted through the scheme unlawful (i.e. granted without the approval of the Commission, which should be regarded as never been decided since its annulment). As a result, the UK Government decided to suspend the capacity market, meaning that it will not grant new associated subsidies until it is newly decided if they are compliant with EU law. However, in December 2018, the UK Government confirmed that it will operate the capacity market as normal, but without payments being made to agreement holders. The UK Government also confirmed that it intended to hold a replacement T-1 auction for the delivery year 2019/2020, which would be held by rearranging the postponed T-1 auction that had been scheduled for January 2019.

In the meantime, the Commission lodged an appeal against the General Court’s judgment before the Court of Justice on 25 January 2019. It also initiated the formal investigation on 21 February 2019 in order to adopt a new decision.

Why did the General Court annul the decision? What has been the effect on the industry and how will the market operate in this limbo period? What impact might it have on the UK energy policy? How will past unlawful payments be treated? Will they be recovered? Will a deal or no-deal scenario for Brexit play a role in the next steps?

Background

The capacity market in Great Britain[1] was established following the European Commission’s decision of 23 July 2014 to approve the aid scheme for the market, with the Commission having concluded that it was compliant with EU State aid rules. The purpose of capacity market is to ensure electricity supply in periods of peak demand by offering subsidies to capacity providers that successfully bid for capacity agreements in auctions. In December 2014, Tempus Energy, a UK-based demand side response (DSR) operator, contested the Commission’s decision.

 

The Tempus Argument & the GC’s Judgment

Tempus contended that the GB capacity market scheme privileges generation (largely fossil fuel operators) over demand-side response (DSR) in a discriminatory and disproportionate manner that goes beyond what is necessary to achieve its objectives and fulfil State aid requirements.

Tempus’s main argument was that the Commission approved the capacity market following the preliminary examination of its notification but without initiating the formal investigation, which is required when there are doubts about the compatibility of an aid. Tempus submitted that the Commission heavily relied on the UK government’s submissions on the market. The GC agreed that the Commission had not followed the necessary procedure and should have addressed doubts about the scheme. In order to show the existence of objective doubts, Tempus successfully argued that the scheme unfairly discriminates between capacity providers in the length of contracts awarded through the auction system, with DSR limited to one-year contracts as opposed to the fifteen-year contracts available to generators. Despite DSR offering an equivalent solution and having similar circumstances with respect to upfront investment and benefitting from long-term support, it is not offered the same opportunities as generators.

The Next Steps

Following the judgment, the UK government department for business, energy and industrial strategy (BEIS) did not re-notify the scheme. The effect of the GC’s judgment was to put the Commission in the situation it was when the UK notification was submitted in 2014. Until newly approved, the capacity market remains suspended. In the meantime, BEIS and National Grid, as the EMR delivery body, have issued guidelines for existing capacity providers during the standstill. On 25 January, the Commission lodged an appeal against the Court’s ruling. On 21 February, the Commission announced it had launched an in-depth investigation on the compatibility of the scheme with the EU State aid rules, inviting all interested parties to submit comments. On 5 March, Tempus initiated judicial review against the UK Government before the English High Court. Tempus is asking orders (i)  preventing the replacement T-1 auction, (ii) preventing the administration and enforcement of existing capacity agreements, (iii) preventing collection of the supplier charge financing the capacity market and (iv) requiring to recover any unlawful aid.

In the meantime, what does this uncertainty mean for the market? Is the security of supply at risk? What opportunities does the judgment present? How might the capacity market rules be reformed? Will it force the adoption of more innovative technologies? Will flexibility play a greater role in a future mechanism?

[1] The capacity market does not include Northern Ireland.

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Online Event

Energy Regulation in Times of Disruptive Innovation

04 March 2019

The first online debate leading up to the FSR Global Forum discusses the topic of energy regulation in times of disruptive innovation.

Innovation is not only affecting the choice of technology but also the economics of the electricity industry, the business models and potentially the whole organization of the sector.

Higher (pro-active) participation of consumers and decreasing scale economies (in generation or/and storage) will change the role of network and traditional organization of the sector (centralized with flows from generation to consumers). To benefit from the opportunities of the transformation it is imperative to adapt regulations and policy accordingly.

 

Speakers:

Laurent Schmitt | ENTSO-E

Michelle Hallack | FSR

Massimo Ricci | ARERA

Moderator:

Jean- Michel Glachant | Florence School of Regulation

An open discussion will follow.

Watch the debate recording:

About the FSR Global Forum

The FSR Global Forum is a 4-day event fostering practice-oriented solutions on key aspects of the world energy transition. It provides a platform for multi-stakeholder engagement to facilitate transnational knowledge exchange.

It brings together 100 representatives (by invitation only) from government agencies, regulatory bodies, energy companies, energy utilities, development organisations and academics from across the world.

The Forum develops around 12 knowledge spaces to facilitate interactive discussions and digitally maps the key insights of each session. The topical issues addressed have a special focus on Latin America, Africa and Asia.

Visit the Forum website

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Online Event

EU Common Rules for Gas Import Pipelines

28 February 2019

This Webinar by the FSR Energy Union Law will review the EU Common Rules for Gas Import Pipelines and the Latest Developments on the Amendment to the Gas Directive

Join Professor Kim Talus (Tulane Law School; University of Eastern Finland; and University of Helsinki) for a free webinar and open discussion on The Latest Developments on the Amendment to the EU Gas Directive, organised by the FSR Energy Union Law Area.

Topics

In this webinar, Professor Kim Talus will review the latest developments on the Commission’s proposed amendment to the 2009 Gas Directive, which extends the Third Energy Package to include gas import pipelines, following the agreement of 12 February 2019 reached at the conclusion of the trilogues. 

We will address:  

  • The background to the Amendment: Why do we need it or do we?
  • Details of the Amendment: What is changing and who is impacted?
  • Details of the Amendment: How does it impact the energy competences of Member States?
  • The relationship between Nord Stream 2 and the Amendment

Speaker

Professor Kim Talus is the James McCulloch Chair in Energy Law and founding Director of the Tulane Center for Energy Law (Tulane Law School). He is also a Professor of European Energy Law at UEF Law School (University of Eastern Finland) and a Professor of Energy Law at Helsinki University.

Disclaimer: While the webinar is an academic debate, please note that Professor Kim Talus has previously been attached to the Nord Stream 2 project. The Energy Union Law Area is not associated with the project. Professor Talus is an invited guest for the series.

Background

See Prof. K. Talus’ recent publication, in response to the agreement,  EU Gas Market Amendment – Despite of Compromise, Problems Remain (OGEL, February 2019), available here

And Professor Leigh Hancher’s recent paper on the proposalA common EU framework regulating import pipelines for gas? Exploring the Commission’s proposal to amend the 2009 Gas Directive,available here

 

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Seminar

Multilateral Electricity Trade in Southeast Asia

27 February 2019

This seminar presents the policy debates surrounding the development of multilateral electricity trade in Southeast Asia from the perspective of ASEAN policymakers, power sector stakeholders, and international consultants. It aims to explore the applicability of international experiences on this particular bloc of countries without fully built-out infrastructure and at varying stages of market liberalisation.

Four countries in Southeast Asia are currently piloting the first multilateral electricity trade initiative in the region. The Laos-Thailand-Malaysia-Singapore Power Integration Project (LTMS-PIP) has commenced phase one, with Malaysia recently signing an agreement to purchase electricity from Laos through existing transmission networks in Thailand. Singapore is expected to join at a later date.

The LMTS PIP is being put to trial in the context of a broader power integration initiative involving all ten-member countries in the Association of Southeast Asian Nations (ASEAN): the ASEAN Power Grid.[i] If successfully operationalised, the LTMS PIP would demonstrate the feasibility of trading and governing electricity trade across liberalised and regulated markets, and potentially encourage other countries in Southeast Asia to link up in the APG.

Presenter: Shelly Hsieh, Policy Leaders Fellow, School of Transnational Governance

The Seminar is organised by the Research Team of the Florence School of Regulation – Energy and open to all EUI members.

[i] The ten ASEAN member states are: Brunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam.

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Forum

5th Florence Intermodal Forum: Internalising the External Costs of Transport

20 May 2019

Following the usual approach of the Florence School of Regulation, stakeholders and academics will join the 5th Florence Intermodal Forum to examine the significant external costs of transport, and reflect on the necessary policy tools to internalise these. The discussion will be based on a new study “Sustainable Transport Infrastructure Charging and Internalisation of Transport Externalities”.

 


BACKGROUND

Personal and goods transport entail a significant societal and economic cost in the form of environmental and human health impacts, accidents, congestion, as well as infrastructure wear and tear. These costs are, however, largely unaccounted for in the price that transport users pay today.

In the absence of a dedicated policy framework, transport users do not consider external costs as part of their travel decisions. Cost reflective price signals are key to incentivising efficient transport patterns, while enabling consumers and industry actors to make informed purchase and investment decisions. The adequate internalisation of transport’s external and infrastructure costs offers important benefits in terms of promoting a more efficient use of infrastructure, reducing the transport sector’s contribution to climate warming CO2 emissions, air and noise pollution, while securing fairness for transport users.

Back in 2011 the European Commission acknowledged in its White Paper the importance of implementing ‘fair and efficient transport pricing’, and a number of ongoing legislative processes, most notably the revision of the Eurovignette Directive on road pricing, aim to enact the ‘user pays’ and ‘polluter pays’ principles. Yet while there is agreement over the general principles, the specific policy design is still to be determined. What is more, the French government’s recent backing down on a tax proposal that would have seen fuel prices increase by just under 3% shows just how difficult it is to impose any economic pain in the name of tackling climate change.

In order to summarise the existing scientific and practitioners’ knowledge the first Handbook on external costs was presented in 2008 as an output of the IMPACT study. The focus was on transport’s marginal external costs as a basis for the definition of efficient pricing schemes. The Handbook, however, did not provide information on existing taxes and charges or infrastructure costs, which was collected in 2012 in the Inventory of measures of internalisation.

The update of the Handbook followed in 2014. In comparison to the 2008 Handbook, the updated Handbook integrated infrastructure costs, which were initially addressed in a separate report, and provided more detailed country- and area-specific estimates of marginal external cost.

The European Commission recently commissioned a new study “Sustainable Transport Infrastructure Charging and Internalisation of Transport Externalities”, whose aim it is to feed into ongoing debates, both on technical and policy levels, through an update of the handbook on external costs, of the infrastructure costs and of the existing internalisation measures. The study’s scope is much broader and also more detailed than any work previously done in this area. The forum will share latest findings and discuss them. The study indeed compares infrastructure and external costs with taxes and charges paid by transport users. Based on this comparison it becomes evident that users and polluters do not fully pay the total costs (external and infrastructure) they are responsible for.

These preliminary findings lead us to the idea that, so far, in the EU the principle ‘the society pays’ is more applicable than e.g. ‘the user pays’ or ‘the polluter pays’. To put things into perspective, the study finds the overall size of transport external costs to be around 1 000 billion euro annually, the equivalent of almost 7% of EU28 GDP. Moreover, discrepancies can be observed between transport modes, with rail users paying a higher share of their external costs than road users.

This forum gathers policy makers, industry representatives from all transport modes, and academics for a well-timed discussion, based on the new study, to examine the significant external costs of transport, and reflect on the necessary policy tools to internalise these. More specifically, the forum seeks to answer the following three critical questions:

  • Is the ‘user pays principle’ an appropriate tool to account for the infrastructure costs of transport? Can it be implemented in a socially just manner?
  • Can carbon- and pollution-based taxation be a means to implement the ‘polluter pays principle’?
  • What policy measures need to be enacted at European, national and local levels to achieve the user-pays and polluter pays principles?

DOWNLOAD:

PROGRAMME

EUROPEAN TRANSPORT REGULATION OBSERVER


RELATED PRESENTATIONS:

 

For more information, please contact FSR.Transport@eui.eu.

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Workshop

Gas as an integral part of the EU decarbonisation strategy

18 February 2019

Biogas, biomethane, hydrogen and other “green gases” are increasingly being discussed as a part of the long-term EU decarbonisation strategy and as enablers energy transition.

The intermittent nature of renewable electricity production and the ambition to reach a share of 50% or above of wind and solar in the EU generation mix by 2030 invite reflection on the role of conventional natural gas in power in the short-to-medium term. Further, natural gas today plays a major role in industry and the residential heating sector.

Recent energy-related protests have underlined the importance of ensuring that the EU’s decarbonisation strategy is accompanied by public acceptance, and a great deal of public acceptance will be determined by the affordability of energy for citizens.

Despite the adoption of Paris Agreement and very recently the Katowice Rulebook, the IEA expects that oil, gas, shale gas and coal will continue to provide a great share of the global energy supply. Moreover, in several non-EU countries the consumption of conventional fuels, including natural gas, is foreseen to increase in the next years. IEA scenarios for Europe also see some continuing role for fossil fuels (see IEA World Energy Outlook 2018).

To what extent can we discuss the role and long-term prospects for conventional gas in this context? What should the next Commission do in order to ensure the EU decarbonisation strategy is carried out in a cost-effective way? Which problems should the Gas Market Design address and how should it address them?

Download the presentations

Among confirmed speakers: 
  • Christopher Jones | FSR
  • Ilaria Conti | FSR
  • Eva Hennig | Eurogas
  • Anne Sophie Courbeau | BP
  • Lisa Fischer | E3G
  • Torben Brabo | GIE

Programme Sessions:

  • Setting the scene: How can gas ensure that the EU meets its goals and keeps energy costs low for citizens and industry?
  • 1st Session: The role of gas in an increasingly electrified world
  • 2nd Session: What support is needed for the decarbonisation of energy-intensive industries?
  • 3rd Session: Fuelling transport – CNG, LNG, hydrogen?
  • 4th Session: The evolving building heating sector: electrification, hybrid heating, or hydrogen?

This workshop was organized in partnership with FSR, GIE and Eurogas 

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Workshop

Local Governance for the Energy Transition

25 February 2019

Decarbonisation, decentralisation, and digitalisation are major drivers of an ongoing transformation in the energy markets leading to a new energy governance framework. The so-called ‘energy transition’ challenges the way markets have been regulated, but not only. It also challenges the existing EU energy governance system. Besides the current multi-level governance between the EU, national authorities and undertakings, decentralised energy markets add to the puzzle the growing role of local authorities.

The role of local authorities for the energy transition needs to be suitably incorporated in the governance model of the emerging EU multi-layer and multi-sector energy market architecture. A coherent governance model must conciliate five different dimensions: technical system management, market organisation, institutional structures, consumer and market agent’s interaction (business) models and policy.

New energy governance requires the creation of new functions and structures, as well as the adaptation of existing ones. This increasing complexity must be urgently translated at regulatory and governance levels. It includes the vertical dialogue between regional, national and local authorities, as well as diagonal coordination between these multi-level authorities and the new business model or market roles, e.g. decentralised renewable generation, news role of DSOs, mini-grids, cooperative and digital platforms trading power, prosumers, targets on heating and cooling, electric vehicle charging industry, biogas plant for organic waste management, etc.

The objective of the workshop is twofold:

    1. to discuss the theory and practice of new energy local governance models;
    2. to launch a proposal for translating into an appropriate legal language all relevant technical, economic and institutional aspects at the core of new energy governance in the EU and for providing the necessary training structure to all involved decision-makers and stakeholders.

Implementation of this proposal should be achieved through a project supported by interested cities and the European University Institute (Florence School of Regulation and School of Transnational Governance). Active support from European institutions and the European Federation of Energy Law Associations is also expected.

Watch the live-stream here:

The workshop is a joint collaboration between the Florence School of Regulation and the School of Transnational Governance. 

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Seminar

Business models for renewable energy aggregation

11 February 2019

In cooperation with the European Union- funded BestRES project, this seminar will focus on the business models for renewable energy aggregation, providing an overview of the business models and legal framework available to aggregators acting in future markets.   

Aggregators should be intermediaries to put “Consumers at the heart of the Energy Union”. Currently, aggregators are mostly acting for large scale and industrial consumers. Consumers, and prosumers, do not have means to trade directly in the energy markets and require the services of an aggregator. Aggregation service providers are therefore central players for the active participation in the energy markets.

In the short and medium term, aggregation appears to be more attractive in the field of large applications. The regulations in the “Clean Energy for all Europeans” Package envisage a situation in long term prospective where the consumers and prosumers are more integrated in the energy market.

This workshop will provide the participants with an overview on the real-life implementation of business models for aggregators acting in the future markets to support prosumers engagement and their clients of decentralised RES production units.

The workshop will also provide a set of national and European enabling conditions identified during the BestRES project for the uptake of business models for RES aggregation to support policy-makers in elaborating strategies and ease the transition towards cleaner sources of energy.

For further details on the content of the workshop, you can contact Anne-Marie Kehoe or read more information on the BesRES website.

Agenda of the workshop

 

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