Andris Piebalgs Energy CommissionerFuture of Euro-Mediterranean Energy Relations Speech at the OME General Assembly MeetingBrussels, 10 December 2007

20 octobre 2021 Pierre Perrin-Monlouis

Speech at the OME General Assembly Meeting
Brussels, 10 December 2007

Mr. Chairman, Ladies and Gentlemen,

I would like to thank the OME [Observatoire Méditerranéen de l’Energie] for inviting me to speak at the Association’s General Assembly meeting on the future of our Euro-Mediterranean relations in the field of energy. It is good to see together the leading energy companies operating in this region.

I would also like to thank the OME for the important work it has done to promote the co-operation between the major energy companies operating in the Mediterranean basin since it was founded back in 1988.

Now, I would like to seize the excellent opportunity of today’s meeting to inform you about the latest steps we have taken as regards energy policy.

This exchange of view comes at a very timely moment. We are today a week ahead of a meeting that will have a decisive impact on the Euro–Mediterranean cooperation in the energy field. Indeed, on 17th December, the 5th Euro-Mediterranean Ministerial Conference on Energy will take place in Cyprus during which Ministers of the EU Member States and Ministers from our partner Mediterranean countries will endorse a comprehensive Priority Action Plan for the Euro-Mediterranean energy cooperation running from 2008 to 2013.

I am pleased to present to you the main guidelines of this Action Plan, but before sharing it with you, let me please recall what we achieved recently in terms of energy policy and Euro-Mediterranean cooperation.

Over the last three years, the energy landscape has significantly changed. And it will continue to change rapidly in the years to come:

Oil prices have hit record highs – close to $100 a barrel;
Global demand for hydrocarbons is increasing – by more than 50% by 2030. According to the latest IEA World Energy Outlook, the energy demand is ‘increasingly unsustainable’. Energy demand in developing countries is likely to double by 2030;
In Europe, domestic reserves are dwindling. This is increasing import dependence from around 50% of supply today to almost 70% by 2030;
The global energy system requires investments of more than $20 trillion until 2030;
And above it all, looms the spectre of climate change, with global CO2 emissions set to rise by more than 50% between now and 2030.
And the combined challenges of global energy security and climate change give rise to a new interest in the debate not only about conventional energy and renewable energies, but also about the future of nuclear energy.

At the same time, the Maghreb and Mashreq regions have a crucial energy supply potential with major oil and gas reserves but also with a huge potential for renewable energy; in particular solar, wind and biomass.

The EU is a major reliable, attractive and growing market for the energy, offering a real win-win scenario. I firmly believe it is in our common interest to use this market for the economic and social development of the region. I am also convinced that there is clear added value to be gained by the EU and the private sector from the working together in this direction and along our latest energy policy developments.

Ladies and gentlemen,

If I am asked today what is the most important issue for global security and development, the issue with the highest potential for solutions but also for serious problems if we do not act in the right way, it is energy and climate change.

History will judge us on our ability to manage this energy environment, and mitigate the worst effects of climate change. It is the great challenge of our generation.

The European Union has put its cards on the table. As the world’s biggest importer of energy, and second biggest consumer, I think it was important for us to show a lead.

On the basis of a Commission’s proposal, the Heads of State and Government of the 27 Member States have committed themselves to a low-carbon energy future. A future that reinforces Europe’s competitiveness safeguards, our environmental objectives and ensures our security of supply.

With this objective in mind, we adopted a major energy and climate change package this year, which sets out the tough goals and targets we want to achieve.

It contained an ambitious, but achievable, headline target: to reduce EU greenhouse emissions by at least 20% by 2020 compared with 1990 levels – a target that we are keen to increase to 30%, if other developed countries join us.

This is an essential first step on the road to our ultimate goal: to reach a shared vision on reducing global emissions by at least 50% below 1990 levels by 2050. Nothing less will do if we are to limit global warming to 2°C above pre-industrial levels. This objective if the basic driver of our policies. In the context of Bali discussions launched last week, I would like to share my expectations that an agreement with the US will be reached, because the elements used to tackle the climate change challenge are very similar with those used in Europe.

Our energy package rests on five pillars:

First, we will increase our energy efficiency, saving 20% of our energy by 2020. This will reduce the carbon dioxide we pump into the atmosphere by 780 million tonnes.
Second, we will substantially increase the amount of energy we use from renewable sources, tripling renewable energy use to 20% by 2020, and requiring a 10% biofuel component in vehicle fuel by 2020 as well. It will be based on a binding national target.
The third pillar involves substantially increasing the amount of clean hydrocarbons we consume. Great technological advances are being made to reduce the carbon emissions from hydrocarbons – for example through the capture and storage of carbon dioxide.
Fourth, we are strengthening the EU’s carbon market, which already covers 50% of our energy emissions and represents a market value of more than €20 billion. Commission’s proposal on the ETS 2013- 2020 will be published at the beginning of the next year. The main principles are clear: auctioning and EU wide cup for emissions.
Finally, we are continuing in our efforts to forge an open and competitive internal energy market. Key in this context is the separation of production and supply from transmission networks in order to create a genuinely Europe wide market for gas and electricity.
The single European energy market will continue to be open to our partners around the world, as long as they play by the same rules as our companies. In other words, we will protect and ensure fair competition in our newly liberalised market. I expect that the proposal is adopted by the end of 2008.

Ladies and gentlemen,

These proposals and decisions have an important impact on our external relations with the objectives of diversification, security and interdependence and there is no doubt that we need the support of your companies operating in the Euro-Mediterranean region to achieve our policy goals. The private sector is essential to carry out projects and provides us with new ideas.

The EU is progressively putting in place a common external energy policy with shared policy objectives and enabling us to speak with one voice in our external relations. The guiding principles in our external action are transparency, inter-dependence, reciprocity and rule of law.

On the basis of these principles, we are gradually developing a new form of energy dialogues and partnerships that focus on progressive convergence between the EU and our partners’ policies.

We are stepping up our efforts to strengthen energy relations. We are also progressing in the gradual convergence of our energy policies and regulatory frameworks with the Mediterranean partner countries towards the long term goal of creating a fully interconnected and common Euro-Mediterranean energy market.

We are deepening our relations not only at regional and sub-regional levels, but also progressing at bilateral level. The aim of these agreements is to promote our mutual energy security through a convergence of markets and legislative frameworks to promote investments, the development of key infrastructures, the exchange of know-how and technologies, facilitate better access to energy services and to promote renewable energies, energy efficiency and energy savings.

By the end of this year we will, together with Egypt and in full cooperation with our German and Danish colleagues, set-up a regional centre for renewable energy and energy efficiency. This will be an important initiative for enhancing cooperation between the EU and Mediterranean partners in this important domain. This could be the basis for the progressive creation of a Euro-Mediterranean green energy market.

I am convinced that these initiatives can play an important role in promoting regional and intra-regional co-operation of benefit to the countries and companies involved.

Next week, on 17th December, Ministers of the EU Member States and Ministers from our partner Mediterranean countries will endorse a comprehensive Priority Action Plan for the Euro-Mediterranean energy cooperation running from 2008 to 2013.

In the Action Plan, we are focusing our efforts on three areas that are:

– Firstly, to ensure the improved convergence of energy policies and to pursue the integration of energy markets in the Euro-Mediterranean region;

– Secondly, to promote sustainable development in the energy sector;

– And thirdly, to develop initiatives of common interest in key areas, such as infrastructure extension, investment financing and research and development.

In order to ensure the improved convergence of energy policies and to pursue the integration of energy markets in the Euro-Mediterranean region, we envisage to help to develop realistic energy scenarios, master plans, reform agendas, to define longer term policy objectives and priorities, to develop the use of appropriate set of tools such as demand/supply forecasts and to establish adequate monitoring and benchmarking tools.

To improve convergence of energy policies and pursue the integration of energy markets in the region, we also encourage the set up of monitoring systems to assess progress and prospects for energy sector reform. This includes the functioning of a comprehensive regional database containing all information relevant to the status and progress of energy reforms in the Mediterranean Partner Countries, which will provide examples of best-practices and serve as a permanent common reference and to define benchmarks.

Besides, the Action Plan mentions the establishment and development of independent energy regulatory agencies. I would be pleased to see the work developed under the Mediterranean Working Group on Electricity and Natural Gas Regulation consolidated and extended to facilitate the transparency of information, to speed up reforms and to gradually liberalise prices, towards the promotion of a harmonized and investment-friendly regulatory framework in the power sector.

To promote sustainable development of the energy sector, the Action Plan foresees to develop and implement appropriate strategies and build the necessary institutional capacity for promoting sustainable energy in the Mediterranean Partner Countries, building inter alia on the knowledge and experience of the European Union. In this area of cooperation, the priority actions would include regulatory policy, institutional building, awareness and information, networking and overcome financial barriers.

We also aim to review the experiences gained in the framework of the MED-ENEC project on energy efficiency in the construction sector in the Mediterranean. We would like to replicate these experiences in other areas, such as improved energy performance of buildings, clean urban transport systems, improved efficiency in the energy transformation or biomass production and co-generation.

To foster sustainable development of the energy sector, priority actions also concern reduction of gas flaring by encouraging the participation in the Global Gas Flaring Reduction partnership by oil and gas producing countries.

In order to develop initiatives of common interest in key areas, including infrastructure, the overall objective of the Action Plan is to facilitate the implementation of investments in energy infrastructure of common interest in the Euro-Mediterranean region.

Here, priority actions include the improvement of the functioning of the Mediterranean regional and sub-regional gas and electricity markets, the extension of the ongoing sub-regional projects in these sectors in the Maghreb and Mashreq, and their ultimate integration with the EU internal markets.

We would like to work jointly, in particular with the support of the European Investment Bank, to strengthen electricity and natural gas networks, installations and other transport means. We would also like to assess oil pipeline options in order to reduce maritime transport of oil and oil products through the Mediterranean Sea.

Ladies and gentlemen,

The Euro-Mediterranean region can and should play an important role in the field of energy. This region has a great potential: energy is a sector in which we can make a real breakthrough, thus bringing a new impetus to the overall cooperation. That is why next week, at the Euro-Mediterranean Energy Ministerial Conference, we are proposing a new ambitious energy partnership to our regional partners. Also, France has identified 2 priorities for its presidency in the second part of the next year – energy and Mediterranean. Your full support and participation are crucial for the success of this partnership. OME can make a key impact in this regard: there are new opportunities, but also a necessity to be truly ambitious.

Thank you for your attention.

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