Since its formation in 1993 the driving vision of the European Union has been to create a single market, a continental economic powerhouse without national borders or laws. But while this vision has been partially enacted with the abolition of passport controls and through the introduction of common policies on trade, agriculture, fisheries and regional development, it has been less successful in creating a single EU energy market.

This lack of energy market progress has been a constant thorn in the side of the European Commission since the first electricity directive in 1999, with a EU Energy Summit in February explicitly recognising the need to build new electricity infrastructure to meet the 2020 targets for energy efficiency, emissions reductions and renewable energy, and to provide for supply security. The Council also called for the completion of the single energy market by 2014.

When the first directives for Europe’s electricity and gas markets were agreed a decade ago, and collectively known as the first energy package, their focus was on competition, supply security and the affordability benefits that a reciprocally competitive market would support. Even the second and third energy packages, with the latter required to be incorporated by member states in March 2011 with the exception of the unbundling clause, focused on competition and security of supply. Yet it is not competition and security that is at the core of EU energy policy; it is sustainability and climate change.

In the absence of any direct US involvement the EU’s voice has carried extra weight in recent global climate discussions with Brussels intent on other economies’ following its lead on carbon trading and emission reduction targets. Indeed such is the Commission’s almost blinkered focus on climate issues that sustainability has arguably become a more pressing energy policy issue than supply security, with the Commission seemingly believing that security can be achieved through sustainability.

This view is endorsed by the Commission’s broad support for a European Supergrid, which envisions a EU-wide transmission system linking the bloc’s renewable generation, and in particular offshore wind. According to Ana Aguado Cornago, chief executive of Friends of the Supergrid (FOSG), an integrated transmission system will be integral in ensuring the bloc’s energy goals are achieved with Cornago also arguing that a supergrid will create wealth and further assist with the development of a single EU energy market.

By ‘energy goals’ Cornago is referring to the Commission’s so-called 20/20/20 vision to cut emissions and increase renewable usage and energy efficiency 20% by 2020. But these are not energy goals; they are climate goals that have been conveniently wrapped in the energy market’s clothes. Although the Commission has not combined the directorates for energy and climate change it nonetheless appears content to let the climate change directorate wield a powerful influence over energy policy. Consequently it is unsurprising that there is no correlation in the deliverables timeline. For example, the Commission wants the single energy market to be complete by 2014 and believes a supergrid will assist in this process, yet such a system is arguably at least two decades away.

Energy policy cannot be developed exclusive of climate considerations, but the first consideration in any policy development has to be security and not sustainability. If Europe’s electricity demand grows at an annual average of 2% then electricity demand will double by 2050, and if annual growth averages 3% it will more than treble. Clearly this incremental demand growth will have to be met sustainably and there is broad support for the Commission’s emissions cut of 85-90% by 2050 relative to 1990 levels.

Where there is less consensus is on the rate of transition to this emission target. The Commission favours deep cuts this decade of 30% followed by an almost linear path to the 2050 goal, while others favour smaller cuts this decade followed by a deeper cuts post 2020. Of the two paths, the former places sustainability over security, and believes sustainability will support security, while the latter places security first and believes that only once security has been ensured can sustainability be fast-tracked.

In support of its sustainability-first approach, the Commission adopted the European Climate Foundation’s Roadmap to 2050 in March that sets out a ‘practical guide to a prosperous low-carbon Europe,’ and identifies three key factors in the development of Europe’s low-carbon economy: continent-wide electricity grid interconnection; doubling annual energy efficiency improvement rates; and reforming the European energy market to enable investment in zero-carbon generation infrastructure.

Proponents of a supergrid argue that with renewable energy playing the driving role in transforming Europe’s fossil fuel economy to a lower-carbon model the proposed grid will benefit the market economically and make supply more secure. The economic argument is straightforward; for an economically optimised energy supply system the generation sites must be placed where there is the highest possible output, yet these sites do not necessarily correlate with centres of consumption. Consequently, a supergrid would maximise economic output of renewable generation and make it available to areas where consumption exceeds renewable output.

The security argument is more tenuous, and is based on the assertion that there is always wind blowing, or sun shining, somewhere in Europe and thus the variable output of wind and solar would be mitigated by a supergrid. While a supergrid would indeed provide a balance among renewable output locations it would be unlikely to fully mitigate the variability of wind and solar generation, given that the average load factor of wind generation is 25-30%. Consequently the primary balancing function of a supergrid would be to balance renewable and back-up generation (gas, clean coal) to ensure that supply security is not compromised.

Central to the creation of a supergrid is the development path of Europe’s energy sector over the next two decades. According to FOSG, ‘If we are to reduce carbon emissions by 80% then all of this increased demand will have to be met by renewable energy. Existing coal, oil and gas generation will have to be phased out – completely. By 2030 there will be no more fossil fuel plant built in Europe. New build will consist mainly of renewables. By 2050, all of Europe’s electricity could come from zero carbon sources.’

This Utopian vision of energy market development is being driven by renewables bigotry that risks becoming endemic. The FOSG and the renewable/environment lobby groups are misguided in promoting such an energy development timeline, and Europe’s energy market and its economy would also be poorer if such a path were followed.

The Commission has to wake up to a couple of unpalatable facts; a single EU energy market will not be completed by 2014 when the current Commission’s term in office ends, and accelerating emission cuts for this decade could risk undermining supply security, energy affordability and, potentially, economic prosperity.