carbon dioxide

A time for pragmatism on the EU package: the Trialogue kicks in

1 December 2008

The issues of climate change and energy – encompassing such challenges as supply security, meeting renewables targets and implementing CCS – are too big to be addressed by individual EU member states acting alone; a unified European approach is needed. A comprehensive EU framework on energy & climate was therefore long overdue when the Council of the EU finally really got the ball rolling in spring 2007 with its invitation to the Commission to rapidly submit proposals in order to meet the famous 20-20-20 targets.

However, if a record book for legislation existed, the Commission would probably hold the world record for the fastest legal package ever drafted, presenting its “Climate Action” proposals – better known as the Energy & Climate Package – on 23.01.2008.

The Package clearly has potentially deep implications for the power plant business. Elements of it currently under debate in the European Parliament (EP) include:

• Geological storage of carbon dioxide (known as the CCS directive), dealing with the legal framework related to the underground storage and the permitting of storage sites, including the purity of the CO2 stream).

• A Communication on “Supporting Early Demonstration of Sustainable Power Generation from Fossil Fuels.”

• The EU Emissions Trading System, dealing with the legal framework for the European cap-and-trade system after 2013 – the 3rd trading period, and including provision for the use of some allowances to support CCS demonstration projects.

• Energy from renewable energy sources, addressing the topic of having 20% of final energy in the EU coming from renewable energy sources (a challenging target).

These measures need to get a formal two-step approval from the EP before they can be sent to the Council of Ministers for endorsement or modification. First the Rapporteur of the responsible parliamentary standing committee steers a “report” through the committee, which is then presented to all parliamentarians for approval during the plenary vote. Between these two steps all parliamentarians have the opportunity to propose modifications, which the plenary vote either endorses or rejects in defining the final position of the EP.

All the Commission’s proposed draft directives have now passed the first step and therefore a report exists for the plenary to vote on and for the parliamentarians to propose modifications of.

But this decision-making process (as established in EU treaties) can take quite some time and has been known to take years.

In the specific case of the Energy & Climate Package, time is running out if the EU wants to present a binding EU framework in keeping with the bold CO2 reduction aspirations it has been promoting globally, in time for the UN Climate Change Conference in Copenhagen in November 2009. This is mainly due to the constraint created by the EP election scheduled for 4-7 June 2009, and the fact that the EP will consequently terminate its current phase of committee activities in April 2009, with a last plenary on 4-7 May 2009 (the new parliament only becoming truly active in September 2009).

Therefore a more pragmatic approach is needed and this is where a procedure kicks-in, unmentioned in the EU Treaties, as the only realistic response to the time pressure now being faced: the Trialogue.

The Trialogue unites the EP, via the responsible Rapporteur and the Shadow Rapporteurs from the other political groups, the Commission, via the responsible Directorate General (DG) and of course the Council, via its Presidency, which steers the whole process.

The aim of the Trialogue is to achieve a compromise on a specific text with the assurance that none of the parties represented at the table may deviate from the agreed compromise. They commit themselves to officially endorsing the text during the official votes of the EP and the Council in order to have the Directive adopted in record time. The idea is that a smaller number of participants is more flexible, can therefore schedule more meetings in a shorter timeframe and can reach compromises faster. The French Presidency of the Council has managed to have all parties agree on a timeframe, which foresees the adoption of the texts by the end of this year.

The problem with such pragmatic approaches is always that one is not really doing things “by the book” and that’s why some parliamentarians feel that they cannot exercise their rights as they should.

Indeed, under the “normal” process, any political group or 40 parliamentarians may introduce an amendment to the report, giving the plenary a chance to vote on it. This problem is exacerbated if there is a disagreement within a political group as to whether their Rapporteur has really taken into account all the interests represented in the group (as has been felt by one of the big political groups in relation to the EU-ETS draft directive).

No player in this institutional game wants to be the “bad guy” by boycotting the process, since all agree that a Trialogue is the only option given a short timeframe. The EU would lose face globally if due to “procedural disagreements” the whole Energy & Climate Package was delayed – or worse, canned.

So the French Presidency of the Council, which runs until end of 2008, scheduled a weekly Trialogue throughout November 2008 in order to reach a compromise in the given timeframe.

But since this process is quite “opaque”, it is very difficult for the European energy sector to follow the evolution of the discussion on very hot topics, such as:

• Will there be sufficient funds available to build 10-12 demonstration plants by 2015?

• Will the requirements for storage be acceptable from a purely technical viewpoint?

• Who will be responsible for the stored CO2 and for how long?

• Should biomass no longer be considered as biomass if it is incinerated in a waste-to-energy plant?

Thinking on these important points, and more, will only be revealed to the public, once a compromise has been achieved, which may of course take into account the current financial and economic crisis.

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