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Chair's conclusions from the Northern European Energy Dialogue

This note reflects the conclusions of the second Northern European Energy Dialogue on putting in place the conditions required for investment in modern energy infrastructure.

This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

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10th October 2013 at the Royal Society, London

On 10th October energy ministers and high level representatives from Belgium, Denmark, Estonia, Finland, Germany, Ireland, Latvia, Lithuania, the Netherlands, Norway, Poland, Sweden, the United Kingdom; the European Commission Director General for Energy; the President of the European Network of Transmission System Operators; representatives from the UK energy regulator; the energy industry; institutional investors and an independent think tank, gathered in London for the second Northern European Energy Dialogue. This note reflects the conclusions of this informal political dialogue on putting in place the conditions required for investment in modern energy infrastructure.

  1. The group was clear that Europe must deliver a significant increase in network infrastructure to derive the full benefits of the single market and its three goals: competitiveness, security of supply and sustainability, including the cost-effective integration of low carbon sources of energy.

  2. Recalling the conclusions of the first Northern European Energy Dialogue in Copenhagen, the group reiterated the need for well-functioning market mechanisms and a stable and predictable investment climate to support the financing of energy infrastructure. A liberalised single market in Europe can enable effective investments in network infrastructure.

  3. The group welcomed the progress that has been made since the first Northern European Energy Dialogue last year. This included the adoption of the Trans-European Networks-Energy (TEN-E) Regulation and the imminent publication of the first Union wide list of ‘Projects of Common Interest’. This is a major step forward in achieving a more integrated energy market, but it is only one step.

  4. The group also welcomed the Commission’s work to deliver early concrete proposals on a 2030 Climate and Energy Framework, for discussion at the March 2014 European Council. In this context many countries noted that there was an urgent need for the EU and the Member States to provide a clear and stable policy framework – with a reformed EU Emissions Trading System at its heart – to bring forward cost-effective investment, not just in generation but also in the infrastructure that will underpin secure and cost-effective reductions in greenhouse gas emissions. Some countries pointed out that the EU ETS should remain a market based instrument promoting reductions of greenhouse gas emissions in a cost-effective and economically efficient manner as stipulated by the EUETS Directive.

  5. In this regard, a number of countries expressed concern that current debate on the 2030 Climate and Energy Framework did not give due weight to the need for new infrastructure to integrate higher volumes of low carbon generation efficiently and cost-effectively. The group also emphasised the importance of energy market integration in underpinning the cost-effective delivery of long term energy and climate goals.

  6. Several countries noted with concern the views of some institutional investors that EU unbundling rules continued to present a barrier to capital deployment in energy infrastructure assets. While acknowledging the important objective of underpinning competition and open market entry, and acknowledging the efforts of the European Commission, the group agreed that it was important to avoid the unintended consequence of deterring investment in both transmission and generation where there is no risk to competition.

  7. Taking the above into account, the group:

  • agreed that the development of the 2030 Climate and Energy Framework should reflect the need for market integration and network delivery to facilitate the deployment of new low carbon generation - alongside demand side response and energy efficiency while maintaining affordable energy prices;

  • welcomed agreement on the TEN-E regulation, and urged the relevant EU bodies and national Governments should work together with TSOs, regulators, industry and other market participants to prioritize the delivery of Projects of Common Interest. EU Member States should reiterate their commitment to full implementation of the TEN-E regulation, including all the necessary steps to be taken in our national administrative requirements and procedures;

  • expressed strong support for the work of regional inter-governmental groups (such as NSCOGI, BEMIP, NSI-East or the Pentalateral Energy Forum) in facilitating the infrastructure investment required to meet our future energy challenges. The regional groups should co-operate closely with ENTSO-E to inform its Ten Year Network Development Plans, and;

Ministers and their representatives looked forward to convening again in 2014. In the meantime, Martin Lidegaard, Minister for Climate, Energy and Building for the Government of Denmark, offered to report the conclusions of the dialogue to the Lithuanian Presidency Event on energy infrastructure on 4-5 November, 2013.

Published 16 October 2013