To Green or not to Green; The EU energy talks ended ignominiously

Talks between European Union leaders on energy policy ended without an agreement on Thursday (December 16th) as states disagreed on how to respond to high coal prices and upcoming green investment rules.

EU leaders met in Brussels for the summit to discuss various issues, including energy prices. Some Member States (and especially Poland) have pressured the EU to reduce volatile coal prices by restricting speculative activity, a stance that contrasts with that of other countries – including Germany.

Another controversy has arisen over whether the EU should classify gas and nuclear energy as climate-friendly investments. Some countries are pressuring the European Commission to propose “sustainable funding and classification” rules within the month.

Talks were suspended without agreement on various energy issues, as leaders could not agree on a final text.

“We realized that there were different views around the table and we could not reach an agreement on the conclusions presented,” said EU Summit President Charles Michel. He added that the leaders would discuss the issue again at a future meeting.

Poland, Hungary against the coal market

Polish Prime Minister Matthew Morawiecki criticized the fluctuations in CO2 prices, which – as he said – mainly benefit speculators.

“The prices of the Emissions Trading Scheme (ETS) should be stable and reasonably predictable,” Morawiecki said, adding that Poland had proposed changes to the coal market to the European Commission.

Morawiecki was backed by Hungarian Prime Minister Viktor Orban, who attended the summit on Thursday, accusing Brussels of “bad regulation” that led to rising energy prices.

The reference price for coal in Europe hit a new record high of 90.75 euros per tonne last week, having risen by more than 50% since early November amid rising gas prices and the impending expiration of its rights. ΣΕΔΕ. The price of CO2 started the year at around 31 euros per tonne.

Analysts say the sharp rise in electricity prices is mainly due to growing global demand for gas and the economic recovery following the pandemic, combined with limited gas supplies from Russia.

Data released by the Ember think tank also show that carbon dioxide prices have little to do with rising electricity prices – an analysis shared by the environment of Ursula von der Leyen, president of the European Commission.

A draft of the summit conclusions had called on the European Commission to deepen its monitoring of EU ETS trade. Spain has also called for a reduction in speculative activity in recent months.

But the effort was eventually abandoned, as EU leaders could not agree on a common position.

Bulgarian President Rumen Radev has called for a deeper study of the causes of rising electricity prices. “In my opinion, the reports do not have the necessary depth, because they simply state that speculation has not been discovered,” he told reporters.

“We expect more from the analysis,” he added.

Classification

Another controversy was over the EU’s ranking of green financing, which determines which investments in Europe can be described as “sustainable” for the transition to a climate-neutral economy.

Brussels is also expected to decide whether to designate gas and nuclear energy as climate-friendly investments by the end of the month.

The Commission has said it plans to propose the rules this month, but is struggling to resolve internal disputes between countries that disagree over which fuels are worth the “green” label.

France leads a group of twelve EU countries pushing for the recognition of nuclear energy as a green energy source in the classification.

However, Austria has threatened to sue the European Commission if it includes nuclear energy in the classification, even winning the deletion of the reference to nuclear energy from the summit conclusions.

“We have won a battle today, but not yet the war over the use of nuclear energy in the European Union,” Austrian Chancellor Carl Nehammer said after the summit. “Austria has made it clear that nuclear energy has no future,” he said.

Germany, which will abandon nuclear power in 2022, has taken a more compromising stance.

“People are overestimating the importance of this issue,” said Olaf Solz, the new German chancellor, who gave a press conference after the summit with French President Emanuel Macron.

“We should not exaggerate the importance of this issue,” he added, adding that the issue was mainly about funding and would not interfere in the individual course of EU countries to become carbon neutral.

euractiv.gr

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