Table.Briefing: Europe

Brussels hesitates after ECJ ruling + EU-Africa summit and the energy transition + Electricity prices

  • After ECJ ruling: Brussels hesitates
  • EU-Africa summit as an opportunity for energy transition
  • EU heads of state discuss Russia
  • Electricity prices: proposals on ETS and market design
  • Steel industry struggles with high energy costs
  • Offshore tenders: EP wants sustainability criteria
  • Google retains tracking on Android
  • EU Commission: Europe faces long road to AI standard
  • Study: semiconductor shortage back on track in 2023
  • Kristina Sinemus: Hesse’s pioneer for digital policy
Dear reader,

Yesterday, the ECJ dismissed the actions brought forward by the governments in Poland and Hungary against the EU’s rule of law mechanism. This allows the EU Commission to withhold funds for member states if democratic rights and freedoms are violated. But there is no question of Brussels taking swift action: it could take “weeks” before action is taken against the violations, it said. Numerous politicians criticize the slow pace and speak of a “stalling tactic”. But Eric Bonse has learned that there are good reasons for proceeding cautiously.

More than four years have passed since the last official summit between the European Union and the African Union. Today, the heads of state and government of the two continents are meeting in Brussels to strengthen relations that have not always been easy. The EU wants to mobilize €150 billion and help its partner countries from the global south with infrastructure projects, including with know-how. The focus is also on sustainable economic development and possible cooperation in the field of renewable energies and green hydrogen. But while industry already sees the EU’s import needs covered, development experts warn against neocolonial structures, as Timo Landenberger reports.

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Sarah Schaefer
Image of Sarah  Schaefer

Feature

After ECJ ruling: Brussels hesitates

The EU Commission will not take action against Hungary or Poland in the short term following the ruling of the European Court of Justice (ECJ) on the rule of law mechanism. Before taking action against violations of the rule of law, it could still take “weeks,” said a spokeswoman in Brussels. She did not want to commit to a date.

Yesterday, the ECJ ruled that the regulation on the conditionality of the rule of law, which was adopted in January 2021, was legally valid. The judges thus rejected the complaints from Hungary and Poland. EU Commission President Ursula von der Leyen welcomed the decision. It shows “that we are on the right track,” she said.

The EU Commission is thus allowed to withhold funds from the EU budget if violations of the rule of law in a member state endanger the financial interests of the EU. This includes, for example, an inadequate fight against corruption or a lack of independence of the judiciary. Such a violation must involve “a circumstance or conduct attributable to an authority of a member state and relevant to the sound financial management of the Union’s budget,” the Court stressed.

Hungary is considered the clearer case

The Commission now intends to examine the ruling in detail. On this basis, existing guidelines for the reduction of EU funds are to be revised. Only then will it be possible to implement the ruling and formally notify countries with violations of the rule of law, according to the authority. The Commission had already sent an initial letter to Budapest and Warsaw, and the replies have now also been received.

In Brussels, the Commission is expected to take action against Hungary first. Experts think this is obvious: “It is easier to prove the link between the deficits in the rule of law and the EU budget here than in the case of Poland,” says Thu Nguyen, Policy Fellow at the Jacques Delors Centre. When the mechanism is used for the first time, the Commission will be very keen to have a watertight case that will stand up before the ECJ.

However, it remains to be seen whether the Commission will initiate the procedure before Hungary’s parliamentary elections in April. In Brussels and Berlin, there is concern that this would provide Prime Minister Viktor Orbán with new ammunition in his campaign against the EU. In any case, the greater leverage would be the funds from the Next Generation EU reconstruction fund, which the Commission continues to withhold, according to government circles.

In contrast, there have recently been signs of détente between Warsaw and Brussels. President Andrzej Duda presented a bill to dissolve the controversial disciplinary chamber of the Supreme Court. In addition, both sides are united by concerns about a Russian invasion of Ukraine and the resulting wave of refugees.

Barley criticizes “stalling tactics”

Sharp criticism of the Commission’s hesitation is coming from the European Parliament. Vice President Katarina Barley (SPD) said the procedure envisaged by the Commission would take at least five months, perhaps even nine. The EU authority’s “stalling tactics” are unacceptable, the former German justice minister said. The MEPs had filed an action for failure to act with the ECJ in the fall to force the Commission to act.

Sharp criticism also came from the Greens and Liberals. The Commission is not living up to its responsibility for fundamental rights and for the EU budget, said Green MEP Terry Reintke. She threatened to postpone the discharge of the EU Commission “until it stops ducking responsibility.”

EU Budget Commissioner Johannes Hahn justified his agency’s action. The aim was to “move forward quickly” but also to “ensure a safe and fair process,” he said. He said the guidelines presented by the Commission for cutting EU funds were well advanced. Nevertheless, it is important to prove a direct link between rule of law violations and the EU budget. Any funding cuts would have to be court-proof, he said, adding that mistakes could not be afforded.

In Berlin, German Justice Minister Marco Buschmann (FDP) called on the Commission to use the instrument now. The chairman of the European Affairs Committee in the Bundestag, Anton Hofreiter, advocated swift action: “The EU Commission must not lose any more time now and must apply the regulation consistently,” the Green politician told Europe.Table.

Somewhat more reserved tones come from the SPD. The Commission will now first name the criteria for a procedure in its guidelines, said the SPD rapporteur in the Bundestag, Johannes Schraps. “On this basis, the Commission should carefully examine whether the violations by Poland and Hungary identified in other proceedings justify the withholding of European funds.” With Till Hoppe and Falk Steiner

  • European policy
  • Hungary
  • Poland
  • Rule of Law
  • Society

Feature

EU-Africa summit as an opportunity for the energy transition

Expectations are high ahead of the sixth summit between the African Union and the European Union, which begins today in Brussels under the French presidency. The two-day summit, which is expected to be attended by all 27 EU heads of government as well as some 40 heads of state from Africa, is intended to put relations between the two continents on a new footing and address pressing issues in the areas of security, health, digitization, and education as well as the energy transition and climate protection.

“Africa can become one of the hubs for the energy policy of the future. The continent has huge potential,” says Udo Bullmann, development policy spokesman for the S&D Group in the EU Parliament, to Europe.Table. The triad of sun, water, and wind is obvious, but in many places there is still a lack of knowledge about this potential. Here, the EU-Africa summit could quickly achieve results.

For African economies, it is important to shape their development in such a way “that dependencies on fossil fuels are avoided from the outset, but at the same time competitive and strong industrial and service sectors are built up,” Bullmann said. This can only be done with Europe’s support, he said, and there is still time: the whole of Africa currently emits less carbon for energy production than Germany alone. “So with the right investments and incentives, we can make Africa one of the leading producers and possibly even a net exporter of clean energy.” This, in turn, could also benefit Europe.

High EU import demand

Because the EU will not be able to meet its growing demand for renewable electricity and green hydrogen through domestic production. Neither the hours of sunshine nor the available surface area are sufficient for this. Estimates of the need for imports range from around 30 to over 50 percent. The German Association of Energy and Water Industries (BDEW) is convinced that “African countries, among others, could play a major role here.”

This makes it all the more important to enter into international partnerships at an early stage. Hydrogen, in particular, offers great opportunities for cooperation and trade relations along new value chains, said a BDEW spokeswoman. “Talking platforms like the EU-Africa summit are therefore enormously important.”

The African Hydrogen Partnership (AHP), based in Mauritius, also has high hopes for the diplomatic meeting. After all, the development of sustainable economic areas requires functioning and fair markets, political stability, and security. It is the task of the EU and the AU to create an appropriate framework, says AHP Secretary General Siggi Huegemann to Europe.Table. Then a win-win situation could emerge. “Due to Africa’s proximity and its potential for production, green hydrogen from Africa is not only necessary for the decarbonization of Europe, but also relatively cheap,” Huegemann said.

Development-oriented approach

Green MEP Anna Cavazzini is calling for a development-oriented approach from the representatives of both sides. The summit must ensure “that the African continent benefits from the development of innovative climate technologies, can create value locally and is not limited to the role of a raw material supplier.

17 percent of the world’s population lives on the African continent, of which more than half have inadequate access to electricity. Four percent of global greenhouse gas emissions are caused in Africa. Yet it is precisely the regions there that are suffering, in some cases considerably, from the effects of climate change. This is another reason why Europe has a special responsibility toward its neighboring continent, says Kerstin Opfer of the development and environmental organization Germanwatch.

The expert on energy policy and civil society in Africa calls for a renewed partnership of equals between the African Union and the European Union based on mutual trust. Structural inequalities must be overcome. Therefore, Europe should pay special attention to the needs of the African population and put its own economic interests on the back burner.

Investment package over €150 billion

During a visit to Senegal last week, Commission President Ursula von der Leyen held out the prospect of an investment package worth €150 billion by 2030 for projects on the African continent. The amount corresponds to half of the total sum earmarked for the European investment and development offensive “Global Gateway” and is to be made up of EU funds, loans, and private capital, as an EU representative explained in the run-up to the meeting. With the infrastructure initiative, the EU also wants to slow China’s advance in countries of the global south and counter China’s new Silk Road (Belt and Road).

The use of the funds, targeted deepening of the partnership and concrete projects are to be discussed today and tomorrow in seven themed rounds of talks. Chancellor Olaf Scholz will take part in one such round table on “climate protection, energy transition, digitization and transport” and, as G7 chairman, will represent the position of the international community, according to a spokesman for the German government.

Originally, the diplomatic exchange was to have taken place in 2020, but was postponed due to the COVID-19 pandemic, making it more than four years since the last official EU-Africa summit.

  • Africa
  • Climate & Environment
  • Energy
  • Energy policy
  • Hydrogen
  • Renewable energies

News

EU heads of state and government discuss Russia

EU leaders will discuss the situation in the Russia-Ukraine crisis at noon today. Before the start of the long-planned EU-Africa summit, the European side will meet for an hour to discuss the latest developments, Council President Charles Michel’s spokesman announced.

France’s President Emmanuel Macron and German Chancellor Olaf Scholz had recently sought a de-escalation of the conflict with President Vladimir Putin in Moscow. Russia had surprisingly announced on Tuesday that it was withdrawing troop units from the Ukrainian border. The EU, NATO, and the US government, however, have not yet confirmed this. The US and NATO said Wednesday that Russia was continuing to build up troops around Ukraine, although Moscow was talking about a withdrawal. It would be good “if they backed up their words with actions, but so far we haven’t seen that,” US Secretary of State Antony Blinken said Wednesday. “What Russia says is one thing. What Russia does is another.”

NATO Secretary-General Jens Stoltenberg also expressed skepticism: “So far, we have not seen any de-escalation on the ground. On the contrary, Russia appears to be continuing its military buildup,” he said on the sidelines of a meeting of alliance defense ministers in Brussels. The German government is demanding clear evidence from Russia of the announced partial withdrawal.

Russia’s Minister of Finance: supplies to other markets

The Ministry of Defence of the Russian Federation said that soldiers from Crimea have returned to their barracks. It released a video showing a train of tanks and other military vehicles on the Crimean bridge. Foreign Minister Sergei Lavrov reiterated his country’s readiness for dialogue with the West on security in Europe – “but not to the detriment” of Russia’s fundamental positions. After all, there is now a willingness to talk about the deployment of short- and medium-range missiles, the transparency of maneuvers, and the restoration of contacts between the militaries of Russia and NATO countries, Lavrov said.

The EU and US have threatened Moscow with far-reaching sanctions against Russia’s largest banks, industry, and energy sector if Russia attacks Ukraine. Russian Finance Minister Anton Siluanov said yesterday that in the event of punitive measures against Russian energy companies, supplies would be diverted to other markets. Russia’s foreign exchange reserves, sovereign wealth fund, and budget surplus should protect the country’s economy and banks from possible sanctions.

Commission President Ursula von der Leyen told the European Parliament that the EU is now prepared for possible disruptions in Russian gas supplies. “All our models show that with the measures we have taken, we are now on the safe side this winter.” For example, he said, several states are ready to supply more liquefied natural gas to Europe. dpa/rtr/tho

  • Energy
  • European policy
  • Nord Stream 2
  • USA

Electricity price: ETS and market design proposals

In response to rising energy prices, new proposals for far-reaching market intervention were voiced on Tuesday. The EPP group in the EU Parliament proposed a safeguard clause in emissions trading. The German Ministry for Economic Affairs, on the other hand, wants to push ahead with the reorganization of the electricity market and is calling the marginal cost model, the central pricing mechanism, into question.

The EPP wants an automatic mechanism to take effect in emissions trading in the future. If the price is more than twice as high as the average of the past two years for six months, 100 million certificates are to be released from the market stability reserve, according to an amendment by MEP Peter Liese, which is available to Table.Media. Recently, the price of CO2 has risen more than citizens can adjust, Liese said at an online event on the Fit for 55 package. In principle, however, Liese wants to continue to hold on to the certificate price as a control instrument. In the long term, the CO2 price must rise above €100, the climate politician affirmed.

Liese sees speculation with CO2 certificates

Liese was convinced that the current CO2 prices were also driven by speculation. Stronger monitoring is therefore needed. “The Commission must propose an addition to the legislation immediately after the submission of a report by the European Securities and Markets Authority,” the EPP MEP wrote in a background paper. “This does not then have to be regulated exclusively in the emissions trading directive, but other financial market monitoring instruments can be used for this purpose.”

The German Federal Ministry for Economic Affairs also sees the need for price corrections. Abolishing the EEG levy will not be enough, said State Secretary Patrick Graichen during the discussion. However, he is skeptical about interventions in emissions trading. “The actual price increase in the electricity market is due to gas prices,” said the top official of the green-led ministry.

Spain and France for new market design

Member states such as Spain and France instead pushed to talk about market design. “I think the discussion is more going there,” Graichen said, questioning the central pricing mechanism in the electricity market: “We need to have an open discussion about whether the marginal power plant sets the price for everyone.” A similar problem looms in a world with 100 percent renewables, he said, if expensive hydrogen-fueled gas-fired power plants set the price for all generators.

In the coalition agreement, the traffic light coalition agreed to set up a “climate-neutral electricity system” platform, which is to present proposals for market reform before the end of 2022. Graichen conceded that there was a need for even faster reforms, but at present, the ministry did not have any elaborate concept in the drawer. In recent days, department head Robert Habeck indicated sympathy for contracts for differences for larger energy parks. ber

  • Climate & Environment
  • Climate Policy
  • Emissions trading
  • Energy

Steel industry struggles with high energy costs

The steel industry is sounding the alarm over the sharp rise in electricity and gas costs. “In the last six months alone our spending on gas and electricity has risen by a three-digit million euro amount,” the head of ThyssenKrupp Steel Europe, Bernhard Osburg, said on Wednesday at the “Handelsblatt Annual Conference Future Steel 2022”. He said prices had doubled and tripled. He said Thyssenkrupp has the advantage of producing two-thirds of the electricity it needs itself through processes at the Duisburg steel site. The remaining third alone leads to these additional costs.

Osburg pointed out that the planned conversion to climate-neutral production would increase electricity consumption even further because hydrogen, for example, would be produced for this purpose with the help of renewable energy. “If we produce in a climate-neutral way, our electricity requirements in Duisburg alone will be equivalent to 4.5 times those of the city of Hamburg.” That’s a gigantic amount that would then have to be purchased in its entirety. The climate protection contracts planned by Federal Economics Minister Robert Habeck would have to partially compensate for this.

Abolition of the free allocation of CO2 certificates

The industry is struggling with an unprecedented increase in energy costs, said Hans Jürgen Kerkhoff, President of the German Steel Federation, at the conference. He said that increased electricity and gas prices were already adding up to annual costs of €1.5 billion for the German steel industry. With emissions of around 60 million tons of CO2 per year, the steel industry in Germany could make an important contribution to climate protection. However, this will only succeed with the right framework conditions.

The heavy industry is already facing significant burdens from the EU’s planned gradual abolition of the free allocation of CO2 allowances, emphasized ArcelorMittalMT.LU’s European CEO Geert Van Poelvoorde. “You really have to ask yourself, will there still be a business model of steel in Europe?” He added that high energy prices were now adding to the problem. rtr

  • Climate & Environment
  • Climate Policy
  • Emissions
  • Energy

Offshore tenders: EP wants sustainability criteria

Tenders for offshore wind farms should include sustainability criteria in the future, according to the European Parliament. “The European Parliament recognizes that for the transition to clean energy, sustainability and the carbon footprint of the entire value chain must be taken into account when offshore wind and other energy technologies are used,” reads the resolution adopted Wednesday on the Commission’s draft offshore strategy. In Germany, bids in tenders for offshore wind farms are awarded solely on the basis of price; in the event of a tie, the decision is made by drawing lots.

The Commission had been more non-binding in its draft, stating that the recyclability of the plants would only have to be examined. The resolution prepared by Danish MEP Morten Petersen (RENEW) is much more specific. In addition to the push for tenders, the parliament calls for a ban on the landfilling of complete rotor blades by 2025.

Member states should also consider the entire life cycle in their expansion plans. The Commission is called upon to develop a strategy for the sustainable decommissioning of offshore installations, if necessary.

Wind energy for heat grids

Parliament also calls on the Commission to analyze best practices for direct electric use of offshore wind energy in district heating networks. MEPs complain that offshore wind energy is currently not taken into account in municipal heat planning. At the German federal level, offshore wind power has so far been considered mainly as a source for producing green hydrogen for industry.

Parliament has not yet decided on a concrete market model for offshore plants. German Economics Minister Robert Habeck (Greens) recently spoke out in favor of contracts for differences, also known as symmetrical market premiums. In the interest of electricity customers, this would allow high revenues from subsidized renewable plants to be skimmed off in the future as a result of high electricity prices. ber

  • Climate & Environment
  • Climate protection
  • Energy
  • Energy policy
  • Renewable energies
  • Wind power

Google maintains tracking on Android

The Alphabet subsidiary has announced Google’s intention to make far-reaching changes to so-called AdID ad tracking early on. The current model of advertising IDs in the Android mobile operating system is to continue operation for at least two years.

However, the company is now looking at alternatives to the current method of cross-app ad IDs. Google announced it is working with app makers such as Snap Inc and Activision Blizzard on ways to enable ad targeting and click logging with less access to personal data.

Competitor Apple had limited the possibilities for its advertisers to identify users across applications without their consent in April 2021 with changes at iOS operating system level. The consent then subsequently required was not granted by many users after the change. The change caused significant financial losses for some providers, the most prominent of which was Facebook.

The dispute over tracking has been raging on several levels for years. Whether, as here, at the operating system level, at the browser level, or in website tracking mechanisms, solutions to the satisfaction of the advertising industry are not currently in sight. On the contrary, the Digital Services Act threatens to impose further restrictions on its data processing options.

US-based providers in particular also face the problem that, in the view of some data protection supervisory authorities, their data processing is currently not compatible with European data protection law, or is compatible only to a limited extent. fst/rtr

  • Android
  • Cybersecurity
  • Data
  • Data protection
  • Digital policy
  • Digitization

EU Commission: Europe faces a long road to the AI standard

Europe’s efforts to set a standard for artificial intelligence (AI) will likely take more than a year. The debate is likely to focus on whether facial recognition should be banned and who should enforce the rules, the EU Commission said Wednesday.

The European Commission presented a draft for AI regulations last year. The EU Parliament could agree on a common position in November, launching talks with EU countries. These could take a year and a half, said Dragoş Tudorache, an artificial intelligence expert at the European Parliament.

The key issue is facial recognition. The Commission wants to allow the use of facial recognition by law enforcement in cases of terrorist attacks and serious crimes. However, civil libertarians fear that this could facilitate discrimination and surveillance by governments and companies.

“I don’t believe in a total ban. For me, the solution is to put the right rules in place,” Tudorache said. MEP Axel Voss, who is working on the legal framework, agreed that facial recognition should be allowed with proper safeguards. While the commission wants the rules to be enforced at the national level, Tudorache said some aspects should be handled by the commission. rtr

  • Artificial intelligence
  • Digital policy
  • Digitization
  • European policy
  • Technology

Study: semiconductor market back on track in 2023

The management consultancy McKinsey expects the chip industry to grow by six to eight percent annually until 2030. The sound barrier of $1 billion in sales is falling, it said in a study. Digitalization has accelerated as a result of the pandemic, McKinsey partner Ondrej Burkacky said.

Megatrends such as working at home, the growth of artificial intelligence, or the increasing demand for electric cars lead to a strong increase in semiconductor demand. At the same time, the shortage of chips in the automotive industry will continue this year; supply and demand will not come back into balance until 2023 thanks to additional production capacities.

Last week, the EU Commission presented the European Chips Act. With this program, the EU wants to promote the production of semiconductors in Europe in order to become less dependent on Asian manufacturers. rtr

  • Digital policy
  • Digitalpolitik
  • Digitization
  • Semiconductor

Profile

Kristina Sinemus: Hesse’s pioneer for digital policy

Kristina Sinemus is Hesse’s Minister for Digital Strategy and Development.

Kristina Sinemus is under special scrutiny. Europe’s administrative experts are likely to follow her every move very closely. This is because Hesse’s digital minister has an ambitious plan. She wants to make her state a model state for digitization. Since taking office in 2019, the 58-year-old has been pursuing the goal of turning Hesse into a “German Silicon Valley,” as she calls it.

Among other things, Sinemus is equipping rural regions with the most powerful internet connections possible, driving forward business models around artificial intelligence (AI) and digitizing administration. “We can serve as a blueprint for digital policy at the federal level and in Europe,” she says. In the German federal government and the EU Commission, digital ministries are bundled with other departmental responsibilities.

One legislative period – she would already have to deal with this duration to build up the team, her colleagues had said at the time when she took office in 2019. “I am impatient by nature and initially wanted to do it in six months.” But she had to learn that many a process passes through many hands. “The advantage is thoroughness,” she says. After 15 months, she was finally fully operational with 100 employees.

Ambitious targets at the EU level

Since then, Sinemus has already got a lot underway in Hesse. Almost 5500 cell towers have been built or renewed in the state. More than 1,500 public internet connections have been installed in the state. And a new research institute for artificial intelligence is being built in Darmstadt at an initial cost of €38 million.

She is not only advancing the topic of AI in her own state. Sinemus is also active at the European level. At her invitation, European politicians and AI experts met at the “Digital Leaders Roundtable” last November to discuss the topic of “Artificial Intelligence for Tomorrow”.

The first goal: a binding legal framework at EU level for the use of AI. And here, too, Hesse’s expertise was relied upon. Last spring, the Hessian Council for Digital Ethics had published a thesis paper entitled “Trust in AI.” “If we follow these guidelines in Europe, we can become pioneers in the development of responsible AI,” says the digital minister.

Kristina Sinemus sees her own house as a cross-sectional ministry. “We want to strengthen the other ministries in their digital projects as best we can.” For example, her ministry is supporting the establishment of a center for quantum computing with almost €3.2 million together with the science ministry. She helped the social affairs department with the purchase of 10,000 tablets for retirement and nursing homes.

Budget sovereignty as a condition

Sinemus herself manages €1.2 billion in this legislative period. “Budget sovereignty must be centralized. This is the only way to see where projects from different departments can be merged,” she says. She declared power over the distribution of funds a condition when Hesse’s Minister-President Volker Bouffier offered her the ministerial post via cell phone three years ago. “I was surprised, consulted with my family for a day and then accepted,” she says.

In fact, she is not a proven digital expert. Until 1991, she studied biology, chemistry, education, and German studies in Münster and Kassel and worked as a research assistant at the Center for Interdisciplinary Technology Research at Darmstadt Technical University. In the late nineties, she founded and managed an agency for science communication. Since 2011, she has held a professorship for political communication at Quadriga Hochschule Berlin.

At the German federal level, she misses clearer structures and processes. “We definitely need a coordinating body, ideally a digital ministry at the federal level.” There’s no way around that. In addition, “Interdepartmental budget coordination must be joined by operations for the entire infrastructure sector. Mobile service, broadband, and its regulation, which has proven itself in Hesse.”

At the moment, however, Sinemus has to take a break. The passionate volleyball player has torn her Achilles tendon. Now she has no choice but to exercise patience for once. “Everything is good for something,” she says. Andreas Schulte

  • Artificial intelligence
  • Digital policy
  • Digitization
  • European policy
  • Germany

Europe.Table Editorial Office

EUROPE.TABLE EDITORS

Licenses:
    • After ECJ ruling: Brussels hesitates
    • EU-Africa summit as an opportunity for energy transition
    • EU heads of state discuss Russia
    • Electricity prices: proposals on ETS and market design
    • Steel industry struggles with high energy costs
    • Offshore tenders: EP wants sustainability criteria
    • Google retains tracking on Android
    • EU Commission: Europe faces long road to AI standard
    • Study: semiconductor shortage back on track in 2023
    • Kristina Sinemus: Hesse’s pioneer for digital policy
    Dear reader,

    Yesterday, the ECJ dismissed the actions brought forward by the governments in Poland and Hungary against the EU’s rule of law mechanism. This allows the EU Commission to withhold funds for member states if democratic rights and freedoms are violated. But there is no question of Brussels taking swift action: it could take “weeks” before action is taken against the violations, it said. Numerous politicians criticize the slow pace and speak of a “stalling tactic”. But Eric Bonse has learned that there are good reasons for proceeding cautiously.

    More than four years have passed since the last official summit between the European Union and the African Union. Today, the heads of state and government of the two continents are meeting in Brussels to strengthen relations that have not always been easy. The EU wants to mobilize €150 billion and help its partner countries from the global south with infrastructure projects, including with know-how. The focus is also on sustainable economic development and possible cooperation in the field of renewable energies and green hydrogen. But while industry already sees the EU’s import needs covered, development experts warn against neocolonial structures, as Timo Landenberger reports.

    Your
    Sarah Schaefer
    Image of Sarah  Schaefer

    Feature

    After ECJ ruling: Brussels hesitates

    The EU Commission will not take action against Hungary or Poland in the short term following the ruling of the European Court of Justice (ECJ) on the rule of law mechanism. Before taking action against violations of the rule of law, it could still take “weeks,” said a spokeswoman in Brussels. She did not want to commit to a date.

    Yesterday, the ECJ ruled that the regulation on the conditionality of the rule of law, which was adopted in January 2021, was legally valid. The judges thus rejected the complaints from Hungary and Poland. EU Commission President Ursula von der Leyen welcomed the decision. It shows “that we are on the right track,” she said.

    The EU Commission is thus allowed to withhold funds from the EU budget if violations of the rule of law in a member state endanger the financial interests of the EU. This includes, for example, an inadequate fight against corruption or a lack of independence of the judiciary. Such a violation must involve “a circumstance or conduct attributable to an authority of a member state and relevant to the sound financial management of the Union’s budget,” the Court stressed.

    Hungary is considered the clearer case

    The Commission now intends to examine the ruling in detail. On this basis, existing guidelines for the reduction of EU funds are to be revised. Only then will it be possible to implement the ruling and formally notify countries with violations of the rule of law, according to the authority. The Commission had already sent an initial letter to Budapest and Warsaw, and the replies have now also been received.

    In Brussels, the Commission is expected to take action against Hungary first. Experts think this is obvious: “It is easier to prove the link between the deficits in the rule of law and the EU budget here than in the case of Poland,” says Thu Nguyen, Policy Fellow at the Jacques Delors Centre. When the mechanism is used for the first time, the Commission will be very keen to have a watertight case that will stand up before the ECJ.

    However, it remains to be seen whether the Commission will initiate the procedure before Hungary’s parliamentary elections in April. In Brussels and Berlin, there is concern that this would provide Prime Minister Viktor Orbán with new ammunition in his campaign against the EU. In any case, the greater leverage would be the funds from the Next Generation EU reconstruction fund, which the Commission continues to withhold, according to government circles.

    In contrast, there have recently been signs of détente between Warsaw and Brussels. President Andrzej Duda presented a bill to dissolve the controversial disciplinary chamber of the Supreme Court. In addition, both sides are united by concerns about a Russian invasion of Ukraine and the resulting wave of refugees.

    Barley criticizes “stalling tactics”

    Sharp criticism of the Commission’s hesitation is coming from the European Parliament. Vice President Katarina Barley (SPD) said the procedure envisaged by the Commission would take at least five months, perhaps even nine. The EU authority’s “stalling tactics” are unacceptable, the former German justice minister said. The MEPs had filed an action for failure to act with the ECJ in the fall to force the Commission to act.

    Sharp criticism also came from the Greens and Liberals. The Commission is not living up to its responsibility for fundamental rights and for the EU budget, said Green MEP Terry Reintke. She threatened to postpone the discharge of the EU Commission “until it stops ducking responsibility.”

    EU Budget Commissioner Johannes Hahn justified his agency’s action. The aim was to “move forward quickly” but also to “ensure a safe and fair process,” he said. He said the guidelines presented by the Commission for cutting EU funds were well advanced. Nevertheless, it is important to prove a direct link between rule of law violations and the EU budget. Any funding cuts would have to be court-proof, he said, adding that mistakes could not be afforded.

    In Berlin, German Justice Minister Marco Buschmann (FDP) called on the Commission to use the instrument now. The chairman of the European Affairs Committee in the Bundestag, Anton Hofreiter, advocated swift action: “The EU Commission must not lose any more time now and must apply the regulation consistently,” the Green politician told Europe.Table.

    Somewhat more reserved tones come from the SPD. The Commission will now first name the criteria for a procedure in its guidelines, said the SPD rapporteur in the Bundestag, Johannes Schraps. “On this basis, the Commission should carefully examine whether the violations by Poland and Hungary identified in other proceedings justify the withholding of European funds.” With Till Hoppe and Falk Steiner

    • European policy
    • Hungary
    • Poland
    • Rule of Law
    • Society

    Feature

    EU-Africa summit as an opportunity for the energy transition

    Expectations are high ahead of the sixth summit between the African Union and the European Union, which begins today in Brussels under the French presidency. The two-day summit, which is expected to be attended by all 27 EU heads of government as well as some 40 heads of state from Africa, is intended to put relations between the two continents on a new footing and address pressing issues in the areas of security, health, digitization, and education as well as the energy transition and climate protection.

    “Africa can become one of the hubs for the energy policy of the future. The continent has huge potential,” says Udo Bullmann, development policy spokesman for the S&D Group in the EU Parliament, to Europe.Table. The triad of sun, water, and wind is obvious, but in many places there is still a lack of knowledge about this potential. Here, the EU-Africa summit could quickly achieve results.

    For African economies, it is important to shape their development in such a way “that dependencies on fossil fuels are avoided from the outset, but at the same time competitive and strong industrial and service sectors are built up,” Bullmann said. This can only be done with Europe’s support, he said, and there is still time: the whole of Africa currently emits less carbon for energy production than Germany alone. “So with the right investments and incentives, we can make Africa one of the leading producers and possibly even a net exporter of clean energy.” This, in turn, could also benefit Europe.

    High EU import demand

    Because the EU will not be able to meet its growing demand for renewable electricity and green hydrogen through domestic production. Neither the hours of sunshine nor the available surface area are sufficient for this. Estimates of the need for imports range from around 30 to over 50 percent. The German Association of Energy and Water Industries (BDEW) is convinced that “African countries, among others, could play a major role here.”

    This makes it all the more important to enter into international partnerships at an early stage. Hydrogen, in particular, offers great opportunities for cooperation and trade relations along new value chains, said a BDEW spokeswoman. “Talking platforms like the EU-Africa summit are therefore enormously important.”

    The African Hydrogen Partnership (AHP), based in Mauritius, also has high hopes for the diplomatic meeting. After all, the development of sustainable economic areas requires functioning and fair markets, political stability, and security. It is the task of the EU and the AU to create an appropriate framework, says AHP Secretary General Siggi Huegemann to Europe.Table. Then a win-win situation could emerge. “Due to Africa’s proximity and its potential for production, green hydrogen from Africa is not only necessary for the decarbonization of Europe, but also relatively cheap,” Huegemann said.

    Development-oriented approach

    Green MEP Anna Cavazzini is calling for a development-oriented approach from the representatives of both sides. The summit must ensure “that the African continent benefits from the development of innovative climate technologies, can create value locally and is not limited to the role of a raw material supplier.

    17 percent of the world’s population lives on the African continent, of which more than half have inadequate access to electricity. Four percent of global greenhouse gas emissions are caused in Africa. Yet it is precisely the regions there that are suffering, in some cases considerably, from the effects of climate change. This is another reason why Europe has a special responsibility toward its neighboring continent, says Kerstin Opfer of the development and environmental organization Germanwatch.

    The expert on energy policy and civil society in Africa calls for a renewed partnership of equals between the African Union and the European Union based on mutual trust. Structural inequalities must be overcome. Therefore, Europe should pay special attention to the needs of the African population and put its own economic interests on the back burner.

    Investment package over €150 billion

    During a visit to Senegal last week, Commission President Ursula von der Leyen held out the prospect of an investment package worth €150 billion by 2030 for projects on the African continent. The amount corresponds to half of the total sum earmarked for the European investment and development offensive “Global Gateway” and is to be made up of EU funds, loans, and private capital, as an EU representative explained in the run-up to the meeting. With the infrastructure initiative, the EU also wants to slow China’s advance in countries of the global south and counter China’s new Silk Road (Belt and Road).

    The use of the funds, targeted deepening of the partnership and concrete projects are to be discussed today and tomorrow in seven themed rounds of talks. Chancellor Olaf Scholz will take part in one such round table on “climate protection, energy transition, digitization and transport” and, as G7 chairman, will represent the position of the international community, according to a spokesman for the German government.

    Originally, the diplomatic exchange was to have taken place in 2020, but was postponed due to the COVID-19 pandemic, making it more than four years since the last official EU-Africa summit.

    • Africa
    • Climate & Environment
    • Energy
    • Energy policy
    • Hydrogen
    • Renewable energies

    News

    EU heads of state and government discuss Russia

    EU leaders will discuss the situation in the Russia-Ukraine crisis at noon today. Before the start of the long-planned EU-Africa summit, the European side will meet for an hour to discuss the latest developments, Council President Charles Michel’s spokesman announced.

    France’s President Emmanuel Macron and German Chancellor Olaf Scholz had recently sought a de-escalation of the conflict with President Vladimir Putin in Moscow. Russia had surprisingly announced on Tuesday that it was withdrawing troop units from the Ukrainian border. The EU, NATO, and the US government, however, have not yet confirmed this. The US and NATO said Wednesday that Russia was continuing to build up troops around Ukraine, although Moscow was talking about a withdrawal. It would be good “if they backed up their words with actions, but so far we haven’t seen that,” US Secretary of State Antony Blinken said Wednesday. “What Russia says is one thing. What Russia does is another.”

    NATO Secretary-General Jens Stoltenberg also expressed skepticism: “So far, we have not seen any de-escalation on the ground. On the contrary, Russia appears to be continuing its military buildup,” he said on the sidelines of a meeting of alliance defense ministers in Brussels. The German government is demanding clear evidence from Russia of the announced partial withdrawal.

    Russia’s Minister of Finance: supplies to other markets

    The Ministry of Defence of the Russian Federation said that soldiers from Crimea have returned to their barracks. It released a video showing a train of tanks and other military vehicles on the Crimean bridge. Foreign Minister Sergei Lavrov reiterated his country’s readiness for dialogue with the West on security in Europe – “but not to the detriment” of Russia’s fundamental positions. After all, there is now a willingness to talk about the deployment of short- and medium-range missiles, the transparency of maneuvers, and the restoration of contacts between the militaries of Russia and NATO countries, Lavrov said.

    The EU and US have threatened Moscow with far-reaching sanctions against Russia’s largest banks, industry, and energy sector if Russia attacks Ukraine. Russian Finance Minister Anton Siluanov said yesterday that in the event of punitive measures against Russian energy companies, supplies would be diverted to other markets. Russia’s foreign exchange reserves, sovereign wealth fund, and budget surplus should protect the country’s economy and banks from possible sanctions.

    Commission President Ursula von der Leyen told the European Parliament that the EU is now prepared for possible disruptions in Russian gas supplies. “All our models show that with the measures we have taken, we are now on the safe side this winter.” For example, he said, several states are ready to supply more liquefied natural gas to Europe. dpa/rtr/tho

    • Energy
    • European policy
    • Nord Stream 2
    • USA

    Electricity price: ETS and market design proposals

    In response to rising energy prices, new proposals for far-reaching market intervention were voiced on Tuesday. The EPP group in the EU Parliament proposed a safeguard clause in emissions trading. The German Ministry for Economic Affairs, on the other hand, wants to push ahead with the reorganization of the electricity market and is calling the marginal cost model, the central pricing mechanism, into question.

    The EPP wants an automatic mechanism to take effect in emissions trading in the future. If the price is more than twice as high as the average of the past two years for six months, 100 million certificates are to be released from the market stability reserve, according to an amendment by MEP Peter Liese, which is available to Table.Media. Recently, the price of CO2 has risen more than citizens can adjust, Liese said at an online event on the Fit for 55 package. In principle, however, Liese wants to continue to hold on to the certificate price as a control instrument. In the long term, the CO2 price must rise above €100, the climate politician affirmed.

    Liese sees speculation with CO2 certificates

    Liese was convinced that the current CO2 prices were also driven by speculation. Stronger monitoring is therefore needed. “The Commission must propose an addition to the legislation immediately after the submission of a report by the European Securities and Markets Authority,” the EPP MEP wrote in a background paper. “This does not then have to be regulated exclusively in the emissions trading directive, but other financial market monitoring instruments can be used for this purpose.”

    The German Federal Ministry for Economic Affairs also sees the need for price corrections. Abolishing the EEG levy will not be enough, said State Secretary Patrick Graichen during the discussion. However, he is skeptical about interventions in emissions trading. “The actual price increase in the electricity market is due to gas prices,” said the top official of the green-led ministry.

    Spain and France for new market design

    Member states such as Spain and France instead pushed to talk about market design. “I think the discussion is more going there,” Graichen said, questioning the central pricing mechanism in the electricity market: “We need to have an open discussion about whether the marginal power plant sets the price for everyone.” A similar problem looms in a world with 100 percent renewables, he said, if expensive hydrogen-fueled gas-fired power plants set the price for all generators.

    In the coalition agreement, the traffic light coalition agreed to set up a “climate-neutral electricity system” platform, which is to present proposals for market reform before the end of 2022. Graichen conceded that there was a need for even faster reforms, but at present, the ministry did not have any elaborate concept in the drawer. In recent days, department head Robert Habeck indicated sympathy for contracts for differences for larger energy parks. ber

    • Climate & Environment
    • Climate Policy
    • Emissions trading
    • Energy

    Steel industry struggles with high energy costs

    The steel industry is sounding the alarm over the sharp rise in electricity and gas costs. “In the last six months alone our spending on gas and electricity has risen by a three-digit million euro amount,” the head of ThyssenKrupp Steel Europe, Bernhard Osburg, said on Wednesday at the “Handelsblatt Annual Conference Future Steel 2022”. He said prices had doubled and tripled. He said Thyssenkrupp has the advantage of producing two-thirds of the electricity it needs itself through processes at the Duisburg steel site. The remaining third alone leads to these additional costs.

    Osburg pointed out that the planned conversion to climate-neutral production would increase electricity consumption even further because hydrogen, for example, would be produced for this purpose with the help of renewable energy. “If we produce in a climate-neutral way, our electricity requirements in Duisburg alone will be equivalent to 4.5 times those of the city of Hamburg.” That’s a gigantic amount that would then have to be purchased in its entirety. The climate protection contracts planned by Federal Economics Minister Robert Habeck would have to partially compensate for this.

    Abolition of the free allocation of CO2 certificates

    The industry is struggling with an unprecedented increase in energy costs, said Hans Jürgen Kerkhoff, President of the German Steel Federation, at the conference. He said that increased electricity and gas prices were already adding up to annual costs of €1.5 billion for the German steel industry. With emissions of around 60 million tons of CO2 per year, the steel industry in Germany could make an important contribution to climate protection. However, this will only succeed with the right framework conditions.

    The heavy industry is already facing significant burdens from the EU’s planned gradual abolition of the free allocation of CO2 allowances, emphasized ArcelorMittalMT.LU’s European CEO Geert Van Poelvoorde. “You really have to ask yourself, will there still be a business model of steel in Europe?” He added that high energy prices were now adding to the problem. rtr

    • Climate & Environment
    • Climate Policy
    • Emissions
    • Energy

    Offshore tenders: EP wants sustainability criteria

    Tenders for offshore wind farms should include sustainability criteria in the future, according to the European Parliament. “The European Parliament recognizes that for the transition to clean energy, sustainability and the carbon footprint of the entire value chain must be taken into account when offshore wind and other energy technologies are used,” reads the resolution adopted Wednesday on the Commission’s draft offshore strategy. In Germany, bids in tenders for offshore wind farms are awarded solely on the basis of price; in the event of a tie, the decision is made by drawing lots.

    The Commission had been more non-binding in its draft, stating that the recyclability of the plants would only have to be examined. The resolution prepared by Danish MEP Morten Petersen (RENEW) is much more specific. In addition to the push for tenders, the parliament calls for a ban on the landfilling of complete rotor blades by 2025.

    Member states should also consider the entire life cycle in their expansion plans. The Commission is called upon to develop a strategy for the sustainable decommissioning of offshore installations, if necessary.

    Wind energy for heat grids

    Parliament also calls on the Commission to analyze best practices for direct electric use of offshore wind energy in district heating networks. MEPs complain that offshore wind energy is currently not taken into account in municipal heat planning. At the German federal level, offshore wind power has so far been considered mainly as a source for producing green hydrogen for industry.

    Parliament has not yet decided on a concrete market model for offshore plants. German Economics Minister Robert Habeck (Greens) recently spoke out in favor of contracts for differences, also known as symmetrical market premiums. In the interest of electricity customers, this would allow high revenues from subsidized renewable plants to be skimmed off in the future as a result of high electricity prices. ber

    • Climate & Environment
    • Climate protection
    • Energy
    • Energy policy
    • Renewable energies
    • Wind power

    Google maintains tracking on Android

    The Alphabet subsidiary has announced Google’s intention to make far-reaching changes to so-called AdID ad tracking early on. The current model of advertising IDs in the Android mobile operating system is to continue operation for at least two years.

    However, the company is now looking at alternatives to the current method of cross-app ad IDs. Google announced it is working with app makers such as Snap Inc and Activision Blizzard on ways to enable ad targeting and click logging with less access to personal data.

    Competitor Apple had limited the possibilities for its advertisers to identify users across applications without their consent in April 2021 with changes at iOS operating system level. The consent then subsequently required was not granted by many users after the change. The change caused significant financial losses for some providers, the most prominent of which was Facebook.

    The dispute over tracking has been raging on several levels for years. Whether, as here, at the operating system level, at the browser level, or in website tracking mechanisms, solutions to the satisfaction of the advertising industry are not currently in sight. On the contrary, the Digital Services Act threatens to impose further restrictions on its data processing options.

    US-based providers in particular also face the problem that, in the view of some data protection supervisory authorities, their data processing is currently not compatible with European data protection law, or is compatible only to a limited extent. fst/rtr

    • Android
    • Cybersecurity
    • Data
    • Data protection
    • Digital policy
    • Digitization

    EU Commission: Europe faces a long road to the AI standard

    Europe’s efforts to set a standard for artificial intelligence (AI) will likely take more than a year. The debate is likely to focus on whether facial recognition should be banned and who should enforce the rules, the EU Commission said Wednesday.

    The European Commission presented a draft for AI regulations last year. The EU Parliament could agree on a common position in November, launching talks with EU countries. These could take a year and a half, said Dragoş Tudorache, an artificial intelligence expert at the European Parliament.

    The key issue is facial recognition. The Commission wants to allow the use of facial recognition by law enforcement in cases of terrorist attacks and serious crimes. However, civil libertarians fear that this could facilitate discrimination and surveillance by governments and companies.

    “I don’t believe in a total ban. For me, the solution is to put the right rules in place,” Tudorache said. MEP Axel Voss, who is working on the legal framework, agreed that facial recognition should be allowed with proper safeguards. While the commission wants the rules to be enforced at the national level, Tudorache said some aspects should be handled by the commission. rtr

    • Artificial intelligence
    • Digital policy
    • Digitization
    • European policy
    • Technology

    Study: semiconductor market back on track in 2023

    The management consultancy McKinsey expects the chip industry to grow by six to eight percent annually until 2030. The sound barrier of $1 billion in sales is falling, it said in a study. Digitalization has accelerated as a result of the pandemic, McKinsey partner Ondrej Burkacky said.

    Megatrends such as working at home, the growth of artificial intelligence, or the increasing demand for electric cars lead to a strong increase in semiconductor demand. At the same time, the shortage of chips in the automotive industry will continue this year; supply and demand will not come back into balance until 2023 thanks to additional production capacities.

    Last week, the EU Commission presented the European Chips Act. With this program, the EU wants to promote the production of semiconductors in Europe in order to become less dependent on Asian manufacturers. rtr

    • Digital policy
    • Digitalpolitik
    • Digitization
    • Semiconductor

    Profile

    Kristina Sinemus: Hesse’s pioneer for digital policy

    Kristina Sinemus is Hesse’s Minister for Digital Strategy and Development.

    Kristina Sinemus is under special scrutiny. Europe’s administrative experts are likely to follow her every move very closely. This is because Hesse’s digital minister has an ambitious plan. She wants to make her state a model state for digitization. Since taking office in 2019, the 58-year-old has been pursuing the goal of turning Hesse into a “German Silicon Valley,” as she calls it.

    Among other things, Sinemus is equipping rural regions with the most powerful internet connections possible, driving forward business models around artificial intelligence (AI) and digitizing administration. “We can serve as a blueprint for digital policy at the federal level and in Europe,” she says. In the German federal government and the EU Commission, digital ministries are bundled with other departmental responsibilities.

    One legislative period – she would already have to deal with this duration to build up the team, her colleagues had said at the time when she took office in 2019. “I am impatient by nature and initially wanted to do it in six months.” But she had to learn that many a process passes through many hands. “The advantage is thoroughness,” she says. After 15 months, she was finally fully operational with 100 employees.

    Ambitious targets at the EU level

    Since then, Sinemus has already got a lot underway in Hesse. Almost 5500 cell towers have been built or renewed in the state. More than 1,500 public internet connections have been installed in the state. And a new research institute for artificial intelligence is being built in Darmstadt at an initial cost of €38 million.

    She is not only advancing the topic of AI in her own state. Sinemus is also active at the European level. At her invitation, European politicians and AI experts met at the “Digital Leaders Roundtable” last November to discuss the topic of “Artificial Intelligence for Tomorrow”.

    The first goal: a binding legal framework at EU level for the use of AI. And here, too, Hesse’s expertise was relied upon. Last spring, the Hessian Council for Digital Ethics had published a thesis paper entitled “Trust in AI.” “If we follow these guidelines in Europe, we can become pioneers in the development of responsible AI,” says the digital minister.

    Kristina Sinemus sees her own house as a cross-sectional ministry. “We want to strengthen the other ministries in their digital projects as best we can.” For example, her ministry is supporting the establishment of a center for quantum computing with almost €3.2 million together with the science ministry. She helped the social affairs department with the purchase of 10,000 tablets for retirement and nursing homes.

    Budget sovereignty as a condition

    Sinemus herself manages €1.2 billion in this legislative period. “Budget sovereignty must be centralized. This is the only way to see where projects from different departments can be merged,” she says. She declared power over the distribution of funds a condition when Hesse’s Minister-President Volker Bouffier offered her the ministerial post via cell phone three years ago. “I was surprised, consulted with my family for a day and then accepted,” she says.

    In fact, she is not a proven digital expert. Until 1991, she studied biology, chemistry, education, and German studies in Münster and Kassel and worked as a research assistant at the Center for Interdisciplinary Technology Research at Darmstadt Technical University. In the late nineties, she founded and managed an agency for science communication. Since 2011, she has held a professorship for political communication at Quadriga Hochschule Berlin.

    At the German federal level, she misses clearer structures and processes. “We definitely need a coordinating body, ideally a digital ministry at the federal level.” There’s no way around that. In addition, “Interdepartmental budget coordination must be joined by operations for the entire infrastructure sector. Mobile service, broadband, and its regulation, which has proven itself in Hesse.”

    At the moment, however, Sinemus has to take a break. The passionate volleyball player has torn her Achilles tendon. Now she has no choice but to exercise patience for once. “Everything is good for something,” she says. Andreas Schulte

    • Artificial intelligence
    • Digital policy
    • Digitization
    • European policy
    • Germany

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