From Resilience to Solidarity: Shaping the Energy Security of Europe
This is the third installment of the Topic of the Month: Building Energy Security in Times of Uncertainty
Building on this series’ first and second blog posts, this installment focuses on the uncertainty of a permanent transformation of the EU’s energy security approach.
Energy system resilience has created significant challenges for governments, businesses, and consumers across the globe over the past few years. Various factors came into play, including supply chain disruptions caused by the COVID-19 pandemic, high demand due to the economic recovery, geopolitical tensions, and extreme weather events. As a result, governments and energy regulators were called upon to ensure the security of the energy supply and stabilize prices.
Untested security arrangements
If the global gas market tightens and the possibility of shortages in Europe increases, current EU legislation that includes energy solidarity measures may become more crucial. The fact that Member States have concluded so few solidarity agreements in the past means that the EU might still be vulnerable in the case of a harsh winter or another supply disruption moving forward, despite default solidarity agreed upon during the current energy crisis. Potential issues could emerge with exercising several new emergency regulations, such as the Security of Supply and Enhanced Security of Supply rules and the Gas Demand Reduction Regulation.
For instance, the implementation of the 15% storage filling obligation and the burden-sharing criteria as stated by Regulation EU 2022/1032, which aims to increase the minimum level of gas storage capacity that Member States must maintain to ensure the security of their energy supply, may result in disputes between Member States, within the Member States, and between Member States and the EC, undermining the regulation efficacy in a real crisis (Yafimava, 2023).
The regulation does not consider the diversity of the gas storage market across different EU Member States. Some countries have significant storage capacity, while others have limited ability and still rely heavily on imports. This means that the impact of the regulation may vary across different Member States, and some countries (e.g., Poland, Portugal, and Belgium, among others) may face more significant challenges in meeting the minimum storage requirements.
Energy security and solidarity among Member States exemplify the undelaying dichotomy regarding policy implementation between the EU and Member State levels, where the balance between top-down (fixing a target for the EU) and bottom-up approaches (converting EU goals into national targets based on regional demands and market traits) is struggling to find a balance in a Europe with a diversity of Member States contexts (ACER & CEER, 2022). To this end, an important sign of how Member States will ensure energy security going forward and how security and sustainability will interact is the planned revision of National Energy and Climate Plans (NECPs).
Building Energy Security Beyond the Crisis
Under the Regulation on the Governance of the Energy Union (2018/1999), Member States must submit a proposed update of their 2021-2030 NECPs to the European Commission by 30 June 2023. These plans must specify domestic targets and measures across all five dimensions of the Energy Union: decarbonization; energy efficiency; energy security; the internal energy market; and research, innovation, and competitiveness. Given the significant developments in EU energy and climate policy, since the Member States first submitted these Plans in late 2019, their update will likely be a critical juncture for the Union. As discussed in this series, Member States retain significant sovereignty regarding energy. The NECP update will show to what degree they are willing to align domestic energy law and policy with overarching European objectives, including those of the European Green Deal and the REPowerEU Plan. Through this process, the medium-term energy security strategies of the Member States and their complementarity will become clear. The NECP update will also indicate the degree of coherence between sustainability and security policies across the Union. Member States have their work cut out for them: a December 2022 Commission guidance document (Commission, 2022) provided a non-exhaustive list of 43 new EU laws, policies, and legislative proposals that will need to be incorporated in the updated NECPs.
Lessons Learned for Future Resilience
Another open question is how the fossil fuel supply crisis caused by the Russian invasion of Ukraine will inform security and resilience debates and measures in other adjacent sectors. In this regard, an encouraging sign is the European Commission’s March 2023 proposal for a Critical Raw Materials (CRM) Act (Commission, 2023). CRMs are needed to produce many technologies required for the decarbonization of the energy sector, including wind turbines, electric vehicle batteries, and solar PV panels. A secure supply of these materials is thus crucial for achieving the renewable energy targets of the European Green Deal, which at the same time will increase energy security in the Union. The CRM Act draws lessons from the past overreliance on a single import country and sets ambitious diversification goals for all stages of the CRM value chain. While these objectives will be challenging to reach, this proposal may indicate that the Union is determined not to make itself vulnerable to weaponization of imports in the future.
Building European energy security remains a challenging task. While crisis, as so often in the European Union’s history, has driven unprecedented political unity and legislative advances, the long-term effects on the EU’s energy acquis remain to be seen. Much will depend on whether Member States will continue to hold firm in their current solidarity with each other and whether this solidarity will lead to a more constructive exercise of their right to energy sovereignty going forward.
ACER & CEER (2022). ACER and CEER views on the proposal for a regulation amending Regulations (EU) 2017/1938 and (EC) n°715/2009 relating to the access to gas storage facilities.
Commission (2022). Commission Notice on the Guidance to Member States for the Update of the 2021-2030 National Energy and Climate Plans. C(2022)9264 final.
Commission (2023). Proposal for a Regulation of the European Parliament and of the Council establishing a framework for ensuring a secure and sustainable supply of critical raw materials and amending Regulations (EU) 168/2013, (EU) 2018/858, 2018/1724 and (EU) 2019/1020. COM(2023) 160 final.
Yafimava, K. (2023). EU solidarity during a gas crisis: even with a will, the way still looks challenging.