Tempered expectations for EU summit + Sp • Table.Briefings

Dear reader,

“Expectation management” will play an essential role at today’s EU summit, according to Brussels. The negotiations on the EU Commission’s proposals on the energy crisis are likely to be difficult in parts, and the energy ministers will have to discuss the details at their meeting next week anyway. Till Hoppe, Stephan Israel and Claire Stam compiled for you what is on the summit’s agenda and where things could go wrong.

Part of the EU Commission’s proposal package is the establishment of an energy platform for joint gas purchasing in the EU. Yesterday, it published a list of companies and associations that are supposed to advise it on the advisory board. Read in the News which German energy suppliers are part of it.

Smart meters are seen as a building block in the energy transition. Germany now picks up the pace to roll out the systems because there is a lot of catching up to do – in an EU-wide comparison, Germany is very far behind. Corinna Visser analyzed why the rollout in Germany is so complex.

It is not only the expansion of smart meters that is supposed to make faster progress – the EU also has ambitious expansion targets for charging stations for EVs and hydrogen refueling stations. The Parliament adopted a report to this effect yesterday. Federal Transport Minister Volker Wissing presented the “Charging infrastructure master plan” in Berlin.

And with that, the Europe.Table team wishes you a pleasant Thursday!

Your
Lisa-Martina Klein

Summit: the lowest common denominator against the energy crisis

By

Redaktion

The EU heads of state and government are meeting today in Brussels for their regular fall summit. On the table are the new proposals on the energy crisis, which the EU Commission presented last Tuesday. It is the long-awaited response to the skyrocketing energy costs for households and businesses. Diplomats, however, expected difficult discussions in advance and, at the same time, dampened expectations.

The package is technically demanding, the proposals are still very fresh and the starting point for the individual member states is, in part, very different, according to Brussels. It is not expected that the heads of state and government will go into too much detail. Expectation management will play an important role at the summit. There are no easy solutions. An initial political assessment will be made at the summit and the detailed work will be left to the experts and energy ministers, who will meet again next week. Diplomats are also stressing that the EU has already achieved a great deal in a short time.

The impatience is shared, but the “incredible effort of the last few months” should not be underestimated, said one diplomat. In fact, the EU-27 have mastered the first challenge posed by the war in Ukraine, namely to be able to manage practically without Russian gas in the winter. That would have been unimaginable just a year ago. After 45 percent last year, the share of Russian gas is now just over seven percent. At the same time, the joint target of reducing gas consumption by 15 percent has been achieved. The member states pledged to reduce electricity consumption by five percent during peak periods. It has been possible to fill gas storage facilities by 92 percent to date and to diversify supplies with Norway or the USA.

Populists on the rise?

The contentious issue of market design with coupled gas and electricity prices, on the other hand, remains unresolved. In some member states, impatience is growing in the face of plant closures and high energy bills, even for households. Moreover, with inflation galloping and recession looming, many leaders fear social turmoil. The recent demonstrations and strikes in France or Belgium are a clear warning here.

These protests could lead to a decline in public support for Ukraine but also increasingly call into question its goals to combat global warming. This, of all things, comes just days before the start of COP27. Discontent over skyrocketing energy prices are, at the same time, fodder for populists. The arrival of the far right in Sweden and Italy in recent national elections may be just a start. “If no solution is found, this will lead to people taking to the streets,” Czech Industry Minister Josez Sikela warned recently. The coming winter will be decisive, he said.

A gas prices cap, as demanded by more than 15 member states, is also not on the summit’s agenda. There is now talk of a price corridor or a dynamic price cap. Commission President Ursula von der Leyen said on Tuesday that further tests were needed here. The package also includes a platform for energy companies to jointly purchase gas at lower prices. However, antitrust issues still need to be clarified.

Price cap still not an option

In German government circles, there is confidence that a compromise on energy issues will be found at the summit. The Commission’s proposals are “approaches that point the way quite well”. The German government still firmly rejects the price cap for gas. The proposal for a dynamic price corridor also goes too far for Berlin. A price cap could lead to ships taking LNG to Japan and Korea instead of Europe. The German government also remains opposed to the Iberian model of subsidizing electricity production with gas, saying that the model would create the wrong incentives to consume more gas. In addition, there is the problem of leakage, i.e., subsidized electricity could flow to third countries such as Great Britain or Switzerland.

Other member states, however, see these problems as entirely solvable with goodwill. More work is needed, but the discussion will have to be held with the energy ministers rather than at the level of the heads of state and government. Chancellor Olaf Scholz, however, is taking a fundamentally different approach: The aim must be to increase the supply of energy and to distribute it throughout Europe – “that is the much more relevant issue than price caps,” according to the German government. For this reason, he says, the focus should be on sharing energy infrastructure and pushing ahead with cooperative projects such as wind power expansion in the North and Baltic Seas or pipelines to distribute LNG imports.

Coherent package on the agenda

The German government does not want to enter into a discussion about new EU funding sources at the present time. With the funds from NextGenerationEU, there are still “hundreds of billions in the bank”, according to government circles. “If so many funds are still available, the discussion about new funds is actually moot.” Observers in Berlin expect the issue to be discussed seriously only at the December summit. Germany or the Netherlands are not fundamentally opposed to new EU programs such as a new edition of SURE. However, they are waiting to see how the new government in Italy positions itself.

Ursula von der Leyen limited herself to the lowest common denominator with her energy package on Tuesday. She had to accept the reproach of having delivered late and only hesitantly. More speed, however, is difficult in view of the very different positions within the EU-27. Nor can any impetus be expected from the Franco-German engine, as the chemistry between Olaf Scholz and Emmanuel Macron has not been right so far and opinions on the response to the energy crisis differ on key issues.

Ursula von der Leyen prefers to pass the ball back to the member states and wait until a compromise emerges. After all, EU diplomats say, a coherent package is now on the table, unlike a few weeks ago. But the detailed work cannot be done at the summit. The goal, they say, is to demonstrate unity and signal to the markets that the EU is on the right track. “The message has to be: Go for it,” said one EU diplomat. The summit must give clear instructions for action to experts and line ministers so that the package can be adopted in November if possible. Till Hoppe, Stephan Israel, Claire Stam

Smart meters: ready for rollout

By

Corinna Visser

Things are moving: “We will accelerate the smart meter rollout, remove red tape from the Metering Point Operation Act, stimulate the market and competition and, of course, focus on sustainability in the long term,” announced Patrick Graichen, State Secretary at the Federal Ministry for Economic Affairs and Climate Action, recently at the Digital Energy Conference in Berlin. What is meant is the installation of smart metering systems in the German power grid. The draft is supposed to be available by the beginning of 2023.

The industry is already waiting: “The German government must now quickly present and pass the amendment to the Metering Point Operation Act so that the rollout of smart meter gateways can take place nationwide and with legal certainty,” demanded Wolfgang Weber, Chairman of the Board of ZVEI, in an interview with Europe.Table.

The EU is also pushing the pace. In the action plan for digitizing the energy system that has just been presented, the Commission urges member states to accelerate their efforts and increase their national targets for this rollout. After all, smart meters are a core element of intelligent power grids and, thus, a success factor for the energy transition.

Germany lags behind in smart meter rollout

In fact, Germany has a lot of catching up to do. The EU’s previous target for the installation of smart metering systems in the electricity sector was 80 percent of metering points by 2020. Germany has fallen far short of this target. Experts estimate that just 300,000 such systems have been installed in this country – out of 15 million cases where installation would actually be mandatory. However, the EU had left a loophole for the member states: The expansion would only have to take place if there was a positive cost-benefit analysis. In a 2013 study, this analysis was negative.

But the situation is not quite so clear-cut. “Every country has a different definition of smart meter,” says Jarmila Bogdanoff, Manager Smart Energy Systems at ZVEI. In this country, a smart metering system includes a digital electricity meter (modern measuring device) and a communication unit (smart meter gateway). In other EU countries, she said, there are, in some cases, much fewer functionalities and the markets are structured differently. “In Germany, the rollout is far more complex; here we have more than 800 players at the distribution network level,” Bogdanoff explains.

High safety standards, lots of bureaucracy

In addition, Germany placed a lot of emphasis on security. “To many, that may have seemed a bit excessive at the time,” Bogdanoff says. “But our efforts paid off, which was, after all, confirmed by the Cyber Resilience Act.” However, installation is also very costly because of the high security requirements for the supply chain (Silke). “In order to pick up more speed in Germany, the secure supply chain should be streamlined in its design,” Bogdanoff demands.

In the Metering Point Operation Act (MsbG), the German government has developed minimum requirements and a phased plan for expansion. According to this, network operators are obliged to install smart meter gateways for consumers with 6,000 kilowatt hours or more. However, the obligation has been suspended following an emergency ruling by the Higher Administrative Court of North Rhine-Westphalia. However, voluntary installation is possible.

At present, however, network operators are showing little commitment to installing smart meters. The price ceilings for installation are possibly an obstacle. The industry is therefore calling for the amendment of the MsbG: “The state must create incentives so that meter operators install as many smart metering systems as possible as quickly as possible – but without placing an additional burden on customers,” says Bogdanoff.

A lot of potential for new business models

Another way to accelerate expansion would be to lower the mandatory installation limit. This would allow even more households to participate in the energy transition, according to the ZVEI. The sooner a broad mass of smart metering systems is installed, the sooner added value will become apparent and the greater the economic benefit. Entirely new applications could emerge. “Right now, smart metering systems are like cell phones without apps; we’re not using their full potential,” Bogdanoff says. “Yet the opportunities for new business models are huge.”

It took a long time to develop everything on the greenfield site, Bogdanoff says. But now, he says, the technology is ready. “We have tried the systems and tested them in many pilot projects. Now we finally have to get going.” And the amendment to the Metering Point Operation Act must set a clear – and ambitious – target corridor for this.

Uniper and Naftogaz advise EU on gas procurement

German utilities Eon, RWE, VNG and Uniper will advise the EU Commission on joint gas procurement. On Wednesday, the Commission published a list of 36 companies and associations it has selected for the energy platform’s advisory board. The members are supposed to help the Commission make the EU less dependent on Russian gas supplies, according to a website of the Brussels-based authority.

The Leipzig-based energy exchange EEX and the Ukrainian gas group Naftogaz are also represented on the advisory board. Members also include other major European energy companies such as BP, Shell, OMV, TotalEnergies and Eni. The EU Commission has scheduled a first meeting for Oct. 26 in Brussels. Five of the 36 selected members are still waiting to be entered in the transparency register, including the European Bank for Reconstruction and Development.

The energy platform would enable European energy companies to jointly purchase part of their gas on the world market in the future to achieve more favorable gas prices. On Tuesday, Commission President Ursula von der Leyen presented plans to this effect. According to the plan, EU states are to fill 15 percent of their gas storage facilities through joint purchasing starting next year. As von der Leyen said, the countries of the EU’s Eastern Partnership, which includes Ukraine, are also supposed to be involved in the energy platform. ber

Franco-German ministerial meeting postponed due to disagreements

The Franco-German Council of Ministers planned for next Wednesday in Paris has been canceled. Together with the French side, it was decided to move the meeting to January, said government spokesman Steffen Hebestreit on Wednesday. As a reason for the postponement, he named, in addition to scheduling problems of some ministers, continuing need for coordination on bilateral issues.

The Chancellery and the Élysée Palace are currently debating whether Chancellor Olaf Scholz will travel to Paris alone next Wednesday for a meeting with French President Emmanuel Macron. There will also be a bilateral meeting between the two today in the run-up to the EU summit. There, the topics of the summit are to be discussed in advance, i.e., energy issues or Ukraine.

Relations between the two governments have suffered considerably in recent months. Paris has sharply criticized the scope and lack of coordination on the traffic light coalition’s energy “defense shield”. At the same time, Germany was preventing effective action at EU level against high gas prices.

Berlin, in turn, is registering with surprise how Macron is preventing the expansion of gas pipelines to Spain for selfish motives. Scholz considers the construction of the MidCat pipeline important to ensure Germany’s natural gas and, in the future, hydrogen supply. Paris is preventing this to be able to supply hydrogen produced with French nuclear power to Germany in the future, it is said in Berlin. Macron talks a lot about Europe but is not prepared to act when it matters, according to government circles in Berlin.

In addition, there are differences of opinion on the reform of the Stability and Growth Pact, as became clear at Wednesday’s meeting between Finance and Economy Minister Bruno Le Maire and his German colleagues Robert Habeck and Christian Lindner. There are also disputes over armaments policy: From France’s point of view, the German government is relying too much on existing US technology when procuring new equipment for the German armed forces as part of the special fund and is neglecting European development projects such as the FCAS fighter jet or the new battle tank. tho

Charging infrastructure: EU Parliament votes in favor of AFIR report, but against sanctions

From 2026, there is supposed to be a charging station for EVs every 60 kilometers and a hydrogen filling station every 100 kilometers along Europe’s main roads from 2028. This is what the EU Parliament voted for on Wednesday in the vote on the Alternative Fuel Infrastructure Regulation (AFIR). The report by rapporteur Ismail Ertug (SPD) was adopted with 485 votes in favor, 65 against and 80 abstentions.

“There are currently 377,000 charging stations in the EU, but that is only half of what would need to be achieved if EU countries were to keep their promises,” Ertug said. Compared to previous legislation, the AFIR contains binding national minimum targets for the development of alternative fuel infrastructure.

There are supposed to be:

3 kW per registered EV if the share of EVs in the national passenger car fleet is less than 1 percent.
2.5 kW if the share of EVs is between 1 and 2.5 percent.
2 kW for EV share between 2.5 and 5 percent
1.5 kW for EV share between 5 and 7.5 percent
1 kW for EV share above 7.5 percent

Slightly lower expansion quotas apply to plug-in hybrids (see here). And even if no EVs are registered in a country, a minimum coverage of charging infrastructure would have to be built according to the AFIR. The EU Commission had proposed significantly lower requirements in some cases.

In addition, Parliament wants public charging points to be designed for all car brands, credit card payment to be possible, and prices per kilowatt hour or kilogram to be displayed for hydrogen. The sanction mechanism introduced by rapporteur Ertug, which provided for penalties for non-compliance with AFIR requirements, was rejected and is thus off the table.

Already on Oct. 27, the trilogue begins. Ertug made it clear on Wednesday that he will fight for the parliamentary report there, as he considers the Commission proposal and especially the general orientation of the Council to be insufficient to meet the Paris climate targets. VDA President Hildegard Müller welcomed the more ambitious parliamentary position and called on the German government to push for these proposals in Brussels. In addition, Müller said, the EU should “make it mandatory to determine the extent to which political action will be taken if individual member states fail to meet the expansion targets”.

Wissing presents master plan for charging infrastructure

In a bid to drive forward the expansion of charging infrastructure in Germany, German Transport Minister Volker Wissing (FDP) on Wednesday unveiled the new Charging Infrastructure Master Plan, which had been approved by the cabinet shortly before. “The world is looking at us,” he said. Everyone assumed that Germany would be the lead market for e-mobility. By 2030, Germany wants to have one million charging points; there are currently around 70,000, which means that 160,000 charging points would have to be built each year starting immediately. The federal government is providing €6.3 billion for this purpose, Wissing explained.

However, the expansion is also relying on the private sector, especially the automotive industry. The automotive industry is prepared to make its contribution to the success of electromobility, promised VDA President Müller. But as far as infrastructure development is concerned, she apparently sees herself as having only limited responsibility. Müller announced that charging facilities would only be expanded within companies. As envisaged in the master plan, the automotive industry will examine “how it can ensure a functional full supply of electricity for employees and guests at its own locations, linked to the dynamic market ramp-up.”

The Federal Minister of Transport also emphasized on Wednesday that in places where there is no sufficient demand in terms of area technology, the intention is to provide regulatory assistance. This should prevent gaps in supply from developing. luk

Sustainable marine fuels: FuelEU Maritime adopted

Maritime shipping has to reduce its greenhouse gas emissions by 2 percent from 2025, 20 percent from 2035 and 80 percent from 2050 compared to 2020 levels. That’s what the EU Parliament called for in its negotiating mandate set on Wednesday. The report on sustainable marine fuels (FuelEU Maritime) was adopted by 451 votes in favor, 137 against and 54 abstentions. The Commission had proposed lower reduction targets.

The reduction targets are to be achieved through the use of more sustainable marine fuels. The new rules apply to ships of more than 5,000 gross tons, which are responsible for 90 percent of CO2 emissions in maritime shipping. In addition, at least 2 percent synthetic e-fuels or so-called renewable fuels of non-organic origin (RFNBOs) are to be used from 2030.

Swedish rapporteur Jörgen Warborn (EPP) stressed that the Parliament’s position ensures that climate targets are met, the competitiveness of the maritime sector is maintained and carbon leakage and loss of labor are prevented.

Higher RFNBO quotas fail

However, some members of Parliament accuse Warborn of pursuing the interests not of the industry but of the mineral oil companies with this proposal. Tiemo Wölken (SPD) had proposed setting a 6 percent quota for 2035 in addition to the 2 percent quota for RFNBOs by 2030. “We need synthetic fuels such as ammonia, methanol or synthetic marine diesel to make shipping climate neutral,” he explained. However, his proposal was rejected by the EPP and now also by the plenary.

Wölken says his demands are broadly supported by the shipbuilding and mechanical engineering industries, the hydrogen industry, shipping companies and the logistics sector. He, therefore, finds it “absurd that the EPP, which otherwise never misses an opportunity to spout phrases about innovation, jumps ship when it comes to promoting innovation”. The background to the criticism is also that the EPP had insisted on the ramp-up of e-fuels in road transport but only wants to use them in small quantities in shipping.

Warborn defended the rejection of a 6 percent quota, pointing out that the Commission’s proposal does not include one at all. Moreover, it is not yet known what quantities of RFNBOs will be available for shipping. Should the availabilities allow it, the quota could still be increased, the Swede said.

Discrepancy FuelEU Maritime and ETS Maritime

Proposals to expand the scope of FuelEU Maritime to include ships of more than 400 gross tons, as well as geographic coverage, also failed to receive majority support. Instead, voyages that start or end outside the EU are only half considered. Expanding the scope would have aligned with Parliament’s position on including shipping in the European Emissions Trading System (ETS). The EPP’s rejection is particularly surprising because EPP MEP Peter Liese is responsible for the ETS reform in the trilogue.

Warborn justified his stance by saying that the expansion to smaller ship types would mean only 6 percent more emissions savings and thus “wouldn’t have much of an impact.” He also sees no reason why ETS and FuelEU Maritime need to be aligned.

This prompted the Greens to reject the report outright in Wednesday’s vote. The Social Democrats also do not share the rapporteur’s view but ultimately voted in favor of the report because the regulation sets binding rules for the first time ever, explains Wölken. “Even if the targets are not ambitious enough for us and for large parts of the industry, at least we are now setting a starting signal.” luk

CDU/CSU calls for mining renaissance in Germany

The CDU/CSU parliamentary group in the Bundestag wants to strengthen domestic mining again for raw materials extraction and speed up approval procedures in Germany for this purpose. This emerges from a motion for a resolution which the CDU/CSU intends to introduce in the Bundestag on Friday and which Table.Media received in advance.

In it, the parliamentarians call for:

a raw materials summit with the federal states and industry
the adaptation of corresponding laws
the examination of a raw material stockpiling reserve for the resilience of companies against supply chain interruptions.

In this way, the CDU/CSU parliamentary group is drawing attention to the threat to the German economy posed by the shortage of raw materials, supply bottlenecks and significant price increases. In total, it is calling for 19 measures from the German government. “In addition to measures to strengthen the circular economy and increase resource efficiency, greater German involvement in the extraction of raw materials at home and abroad is also required,” the document states.

At the German and European level, the German government must work to establish new partnerships with third countries and provide political and financial support for the raw materials activities of German companies abroad. The Japanese raw materials agency JOGMEC could serve as a model. Trade agreements such as the modernized EU-Chile Association Agreement and CETA must be ratified as quickly as possible.

“The traffic light coalition promise to facilitate domestic raw materials mining has so far waited in vain for implementation,” said Stefan Rouenhoff, the rapporteur of the Bundestag parliamentary group for raw materials policy. Approval procedures that are completed in just a few weeks in Canada, for example, would take many years in Germany. “The federal government must show leadership here, bring the states and industry to the table for a raw materials summit and adopt measures to speed up planning and approval procedures.”

Parliamentary State Secretary Franziska Brantner (Greens), who is responsible for the raw materials strategy in the Federal Ministry for Economic Affairs, said on Tuesday at an event organized by the NGO alliance Arbeitskreis Rohstoffe that she wanted to prevent Germany from going it alone. Instead of developing a new raw materials strategy, she said, the German government would develop key points and incorporate them into the German circular economy strategy and the European raw materials law. The EU Commission will present a draft in early 2023. leo

Habeck: ‘Can’t start a trade war with the US’

Germany and France want to prevent further trade disputes with the United States through negotiations. “We can’t enter into a trade war in times like this,” said German Economy Minister Robert Habeck in Berlin on Wednesday. However, fair competitive conditions should not be abandoned by the United States. This is currently threatening to happen. The EU Commission, which is responsible for European trade policy, must find a decisive answer to this. The talks on this are good, he said.

The Green politician was referring to a package of bills from the Biden administration that would provide government aid for certain industries, such as the auto industry. European companies could be disadvantaged in the process. Habeck said these were strong subsidies intended to lure companies to the United States. France’s Economy Minister Bruno Le Maire added at a joint press conference that there is no need for ramping up sanctions against each other. “There is a need to talk.” rtr

Andreas Baumüller – champion for nature conservation

Andreas Baumüller is Head of Natural
Resources at WWF in Brussels.

The Tiroler Lech Nature Park led the Austrian Andreas Baumüller to Brussels. He calls it the first great success of his career that his involvement prevented a hydroelectric power plant in the 1990s. In 2000, the Tiroler Lech became part of the Natura 2000 network of protected areas.

That was the first contact the forestry graduate had with the European Union. After a few years, he decided that he could do more for his homeland at the level of European politics and moved to Belgium. Since 2012, he has been Head of Natural Resources at the Brussels office of the World Wide Fund for Nature (WWF).

Nature conservation and business are not opponents

With his commitment, he even broke an EU record in 2015: In the Nature Alert campaign for the protection of EU nature conservation law, more people got involved than ever before in a public consultation process. Baumüller was a co-organizer alongside many other NGOs at the time.

Born in Innsbruck in 1970, he does not describe himself as a pure nature conservation lobbyist. “My concern is that we have a pleasant home and give nature the respect it deserves.” Without this attitude, sustainability in business is also not guaranteed. Social, economic and conservation goals must be balanced, in his view. He works for an equitable balance of these three areas.

“One problem is that we focus on the short-term economy. The medium- and long-term economy also needs climate targets.” One of the problems Baumüller sees here is that politicians are usually elected because of their short-term goals. The understanding for a more long-term approach, however, is already there, he says. What is missing, he says, is implementation at the end. “If we just went by what many politicians claim, we should have saved biodiversity three or four times over the course of my career – and fixed climate change at an even higher rate.”

Renaturation and biodiversity

However, the head of the department for nature conservation sees the development of recent years as fundamentally positive. There are more discussions at the political level that revolve around nature’s potential. A good example of this is the EU Commission’s proposed directive from this year: Renaturation of forests and peatlands for binding CO2 from the atmosphere and more biodiversity.

The latter is the focus of his work for WWF, along with the protection of streams and forest areas. “Without biodiversity, the world would be so monotonous.” Behind his house, he does his bit through a meadow orchard and a few beehives. Even a rare little owl has taken up residence there in the meantime. Kim Fischer

EUROPE.TABLE EDITORS

Till
Hoppe

Charlotte
Wirth

Falk
Steiner

Timo
Landenberger

Corinna
Visser

Lukas
Knigge

Eric
Bonse

Sarah
Schaefer

Manuel
Berkel

Lisa-Martina
Klein

Markus
Grabitz

Stephan
Israel

Claire
Stam

Dear reader,

“Expectation management” will play an essential role at today’s EU summit, according to Brussels. The negotiations on the EU Commission’s proposals on the energy crisis are likely to be difficult in parts, and the energy ministers will have to discuss the details at their meeting next week anyway. Till Hoppe, Stephan Israel and Claire Stam compiled for you what is on the summit’s agenda and where things could go wrong.

Part of the EU Commission’s proposal package is the establishment of an energy platform for joint gas purchasing in the EU. Yesterday, it published a list of companies and associations that are supposed to advise it on the advisory board. Read in the News which German energy suppliers are part of it.

Smart meters are seen as a building block in the energy transition. Germany now picks up the pace to roll out the systems because there is a lot of catching up to do – in an EU-wide comparison, Germany is very far behind. Corinna Visser analyzed why the rollout in Germany is so complex.

It is not only the expansion of smart meters that is supposed to make faster progress – the EU also has ambitious expansion targets for charging stations for EVs and hydrogen refueling stations. The Parliament adopted a report to this effect yesterday. Federal Transport Minister Volker Wissing presented the “Charging infrastructure master plan” in Berlin.

And with that, the Europe.Table team wishes you a pleasant Thursday!

Your
Lisa-Martina Klein

Summit: the lowest common denominator against the energy crisis

By

Redaktion

The EU heads of state and government are meeting today in Brussels for their regular fall summit. On the table are the new proposals on the energy crisis, which the EU Commission presented last Tuesday. It is the long-awaited response to the skyrocketing energy costs for households and businesses. Diplomats, however, expected difficult discussions in advance and, at the same time, dampened expectations.

The package is technically demanding, the proposals are still very fresh and the starting point for the individual member states is, in part, very different, according to Brussels. It is not expected that the heads of state and government will go into too much detail. Expectation management will play an important role at the summit. There are no easy solutions. An initial political assessment will be made at the summit and the detailed work will be left to the experts and energy ministers, who will meet again next week. Diplomats are also stressing that the EU has already achieved a great deal in a short time.

The impatience is shared, but the “incredible effort of the last few months” should not be underestimated, said one diplomat. In fact, the EU-27 have mastered the first challenge posed by the war in Ukraine, namely to be able to manage practically without Russian gas in the winter. That would have been unimaginable just a year ago. After 45 percent last year, the share of Russian gas is now just over seven percent. At the same time, the joint target of reducing gas consumption by 15 percent has been achieved. The member states pledged to reduce electricity consumption by five percent during peak periods. It has been possible to fill gas storage facilities by 92 percent to date and to diversify supplies with Norway or the USA.

Populists on the rise?

The contentious issue of market design with coupled gas and electricity prices, on the other hand, remains unresolved. In some member states, impatience is growing in the face of plant closures and high energy bills, even for households. Moreover, with inflation galloping and recession looming, many leaders fear social turmoil. The recent demonstrations and strikes in France or Belgium are a clear warning here.

These protests could lead to a decline in public support for Ukraine but also increasingly call into question its goals to combat global warming. This, of all things, comes just days before the start of COP27. Discontent over skyrocketing energy prices are, at the same time, fodder for populists. The arrival of the far right in Sweden and Italy in recent national elections may be just a start. “If no solution is found, this will lead to people taking to the streets,” Czech Industry Minister Josez Sikela warned recently. The coming winter will be decisive, he said.

A gas prices cap, as demanded by more than 15 member states, is also not on the summit’s agenda. There is now talk of a price corridor or a dynamic price cap. Commission President Ursula von der Leyen said on Tuesday that further tests were needed here. The package also includes a platform for energy companies to jointly purchase gas at lower prices. However, antitrust issues still need to be clarified.

Price cap still not an option

In German government circles, there is confidence that a compromise on energy issues will be found at the summit. The Commission’s proposals are “approaches that point the way quite well”. The German government still firmly rejects the price cap for gas. The proposal for a dynamic price corridor also goes too far for Berlin. A price cap could lead to ships taking LNG to Japan and Korea instead of Europe. The German government also remains opposed to the Iberian model of subsidizing electricity production with gas, saying that the model would create the wrong incentives to consume more gas. In addition, there is the problem of leakage, i.e., subsidized electricity could flow to third countries such as Great Britain or Switzerland.

Other member states, however, see these problems as entirely solvable with goodwill. More work is needed, but the discussion will have to be held with the energy ministers rather than at the level of the heads of state and government. Chancellor Olaf Scholz, however, is taking a fundamentally different approach: The aim must be to increase the supply of energy and to distribute it throughout Europe – “that is the much more relevant issue than price caps,” according to the German government. For this reason, he says, the focus should be on sharing energy infrastructure and pushing ahead with cooperative projects such as wind power expansion in the North and Baltic Seas or pipelines to distribute LNG imports.

Coherent package on the agenda

The German government does not want to enter into a discussion about new EU funding sources at the present time. With the funds from NextGenerationEU, there are still “hundreds of billions in the bank”, according to government circles. “If so many funds are still available, the discussion about new funds is actually moot.” Observers in Berlin expect the issue to be discussed seriously only at the December summit. Germany or the Netherlands are not fundamentally opposed to new EU programs such as a new edition of SURE. However, they are waiting to see how the new government in Italy positions itself.

Ursula von der Leyen limited herself to the lowest common denominator with her energy package on Tuesday. She had to accept the reproach of having delivered late and only hesitantly. More speed, however, is difficult in view of the very different positions within the EU-27. Nor can any impetus be expected from the Franco-German engine, as the chemistry between Olaf Scholz and Emmanuel Macron has not been right so far and opinions on the response to the energy crisis differ on key issues.

Ursula von der Leyen prefers to pass the ball back to the member states and wait until a compromise emerges. After all, EU diplomats say, a coherent package is now on the table, unlike a few weeks ago. But the detailed work cannot be done at the summit. The goal, they say, is to demonstrate unity and signal to the markets that the EU is on the right track. “The message has to be: Go for it,” said one EU diplomat. The summit must give clear instructions for action to experts and line ministers so that the package can be adopted in November if possible. Till Hoppe, Stephan Israel, Claire Stam

Smart meters: ready for rollout

By

Corinna Visser

Things are moving: “We will accelerate the smart meter rollout, remove red tape from the Metering Point Operation Act, stimulate the market and competition and, of course, focus on sustainability in the long term,” announced Patrick Graichen, State Secretary at the Federal Ministry for Economic Affairs and Climate Action, recently at the Digital Energy Conference in Berlin. What is meant is the installation of smart metering systems in the German power grid. The draft is supposed to be available by the beginning of 2023.

The industry is already waiting: “The German government must now quickly present and pass the amendment to the Metering Point Operation Act so that the rollout of smart meter gateways can take place nationwide and with legal certainty,” demanded Wolfgang Weber, Chairman of the Board of ZVEI, in an interview with Europe.Table.

The EU is also pushing the pace. In the action plan for digitizing the energy system that has just been presented, the Commission urges member states to accelerate their efforts and increase their national targets for this rollout. After all, smart meters are a core element of intelligent power grids and, thus, a success factor for the energy transition.

Germany lags behind in smart meter rollout

In fact, Germany has a lot of catching up to do. The EU’s previous target for the installation of smart metering systems in the electricity sector was 80 percent of metering points by 2020. Germany has fallen far short of this target. Experts estimate that just 300,000 such systems have been installed in this country – out of 15 million cases where installation would actually be mandatory. However, the EU had left a loophole for the member states: The expansion would only have to take place if there was a positive cost-benefit analysis. In a 2013 study, this analysis was negative.

But the situation is not quite so clear-cut. “Every country has a different definition of smart meter,” says Jarmila Bogdanoff, Manager Smart Energy Systems at ZVEI. In this country, a smart metering system includes a digital electricity meter (modern measuring device) and a communication unit (smart meter gateway). In other EU countries, she said, there are, in some cases, much fewer functionalities and the markets are structured differently. “In Germany, the rollout is far more complex; here we have more than 800 players at the distribution network level,” Bogdanoff explains.

High safety standards, lots of bureaucracy

In addition, Germany placed a lot of emphasis on security. “To many, that may have seemed a bit excessive at the time,” Bogdanoff says. “But our efforts paid off, which was, after all, confirmed by the Cyber Resilience Act.” However, installation is also very costly because of the high security requirements for the supply chain (Silke). “In order to pick up more speed in Germany, the secure supply chain should be streamlined in its design,” Bogdanoff demands.

In the Metering Point Operation Act (MsbG), the German government has developed minimum requirements and a phased plan for expansion. According to this, network operators are obliged to install smart meter gateways for consumers with 6,000 kilowatt hours or more. However, the obligation has been suspended following an emergency ruling by the Higher Administrative Court of North Rhine-Westphalia. However, voluntary installation is possible.

At present, however, network operators are showing little commitment to installing smart meters. The price ceilings for installation are possibly an obstacle. The industry is therefore calling for the amendment of the MsbG: “The state must create incentives so that meter operators install as many smart metering systems as possible as quickly as possible – but without placing an additional burden on customers,” says Bogdanoff.

A lot of potential for new business models

Another way to accelerate expansion would be to lower the mandatory installation limit. This would allow even more households to participate in the energy transition, according to the ZVEI. The sooner a broad mass of smart metering systems is installed, the sooner added value will become apparent and the greater the economic benefit. Entirely new applications could emerge. “Right now, smart metering systems are like cell phones without apps; we’re not using their full potential,” Bogdanoff says. “Yet the opportunities for new business models are huge.”

It took a long time to develop everything on the greenfield site, Bogdanoff says. But now, he says, the technology is ready. “We have tried the systems and tested them in many pilot projects. Now we finally have to get going.” And the amendment to the Metering Point Operation Act must set a clear – and ambitious – target corridor for this.

Uniper and Naftogaz advise EU on gas procurement

German utilities Eon, RWE, VNG and Uniper will advise the EU Commission on joint gas procurement. On Wednesday, the Commission published a list of 36 companies and associations it has selected for the energy platform’s advisory board. The members are supposed to help the Commission make the EU less dependent on Russian gas supplies, according to a website of the Brussels-based authority.

The Leipzig-based energy exchange EEX and the Ukrainian gas group Naftogaz are also represented on the advisory board. Members also include other major European energy companies such as BP, Shell, OMV, TotalEnergies and Eni. The EU Commission has scheduled a first meeting for Oct. 26 in Brussels. Five of the 36 selected members are still waiting to be entered in the transparency register, including the European Bank for Reconstruction and Development.

The energy platform would enable European energy companies to jointly purchase part of their gas on the world market in the future to achieve more favorable gas prices. On Tuesday, Commission President Ursula von der Leyen presented plans to this effect. According to the plan, EU states are to fill 15 percent of their gas storage facilities through joint purchasing starting next year. As von der Leyen said, the countries of the EU’s Eastern Partnership, which includes Ukraine, are also supposed to be involved in the energy platform. ber

Franco-German ministerial meeting postponed due to disagreements

The Franco-German Council of Ministers planned for next Wednesday in Paris has been canceled. Together with the French side, it was decided to move the meeting to January, said government spokesman Steffen Hebestreit on Wednesday. As a reason for the postponement, he named, in addition to scheduling problems of some ministers, continuing need for coordination on bilateral issues.

The Chancellery and the Élysée Palace are currently debating whether Chancellor Olaf Scholz will travel to Paris alone next Wednesday for a meeting with French President Emmanuel Macron. There will also be a bilateral meeting between the two today in the run-up to the EU summit. There, the topics of the summit are to be discussed in advance, i.e., energy issues or Ukraine.

Relations between the two governments have suffered considerably in recent months. Paris has sharply criticized the scope and lack of coordination on the traffic light coalition’s energy “defense shield”. At the same time, Germany was preventing effective action at EU level against high gas prices.

Berlin, in turn, is registering with surprise how Macron is preventing the expansion of gas pipelines to Spain for selfish motives. Scholz considers the construction of the MidCat pipeline important to ensure Germany’s natural gas and, in the future, hydrogen supply. Paris is preventing this to be able to supply hydrogen produced with French nuclear power to Germany in the future, it is said in Berlin. Macron talks a lot about Europe but is not prepared to act when it matters, according to government circles in Berlin.

In addition, there are differences of opinion on the reform of the Stability and Growth Pact, as became clear at Wednesday’s meeting between Finance and Economy Minister Bruno Le Maire and his German colleagues Robert Habeck and Christian Lindner. There are also disputes over armaments policy: From France’s point of view, the German government is relying too much on existing US technology when procuring new equipment for the German armed forces as part of the special fund and is neglecting European development projects such as the FCAS fighter jet or the new battle tank. tho

Charging infrastructure: EU Parliament votes in favor of AFIR report, but against sanctions

From 2026, there is supposed to be a charging station for EVs every 60 kilometers and a hydrogen filling station every 100 kilometers along Europe’s main roads from 2028. This is what the EU Parliament voted for on Wednesday in the vote on the Alternative Fuel Infrastructure Regulation (AFIR). The report by rapporteur Ismail Ertug (SPD) was adopted with 485 votes in favor, 65 against and 80 abstentions.

“There are currently 377,000 charging stations in the EU, but that is only half of what would need to be achieved if EU countries were to keep their promises,” Ertug said. Compared to previous legislation, the AFIR contains binding national minimum targets for the development of alternative fuel infrastructure.

There are supposed to be:

3 kW per registered EV if the share of EVs in the national passenger car fleet is less than 1 percent.
2.5 kW if the share of EVs is between 1 and 2.5 percent.
2 kW for EV share between 2.5 and 5 percent
1.5 kW for EV share between 5 and 7.5 percent
1 kW for EV share above 7.5 percent

Slightly lower expansion quotas apply to plug-in hybrids (see here). And even if no EVs are registered in a country, a minimum coverage of charging infrastructure would have to be built according to the AFIR. The EU Commission had proposed significantly lower requirements in some cases.

In addition, Parliament wants public charging points to be designed for all car brands, credit card payment to be possible, and prices per kilowatt hour or kilogram to be displayed for hydrogen. The sanction mechanism introduced by rapporteur Ertug, which provided for penalties for non-compliance with AFIR requirements, was rejected and is thus off the table.

Already on Oct. 27, the trilogue begins. Ertug made it clear on Wednesday that he will fight for the parliamentary report there, as he considers the Commission proposal and especially the general orientation of the Council to be insufficient to meet the Paris climate targets. VDA President Hildegard Müller welcomed the more ambitious parliamentary position and called on the German government to push for these proposals in Brussels. In addition, Müller said, the EU should “make it mandatory to determine the extent to which political action will be taken if individual member states fail to meet the expansion targets”.

Wissing presents master plan for charging infrastructure

In a bid to drive forward the expansion of charging infrastructure in Germany, German Transport Minister Volker Wissing (FDP) on Wednesday unveiled the new Charging Infrastructure Master Plan, which had been approved by the cabinet shortly before. “The world is looking at us,” he said. Everyone assumed that Germany would be the lead market for e-mobility. By 2030, Germany wants to have one million charging points; there are currently around 70,000, which means that 160,000 charging points would have to be built each year starting immediately. The federal government is providing €6.3 billion for this purpose, Wissing explained.

However, the expansion is also relying on the private sector, especially the automotive industry. The automotive industry is prepared to make its contribution to the success of electromobility, promised VDA President Müller. But as far as infrastructure development is concerned, she apparently sees herself as having only limited responsibility. Müller announced that charging facilities would only be expanded within companies. As envisaged in the master plan, the automotive industry will examine “how it can ensure a functional full supply of electricity for employees and guests at its own locations, linked to the dynamic market ramp-up.”

The Federal Minister of Transport also emphasized on Wednesday that in places where there is no sufficient demand in terms of area technology, the intention is to provide regulatory assistance. This should prevent gaps in supply from developing. luk

Sustainable marine fuels: FuelEU Maritime adopted

Maritime shipping has to reduce its greenhouse gas emissions by 2 percent from 2025, 20 percent from 2035 and 80 percent from 2050 compared to 2020 levels. That’s what the EU Parliament called for in its negotiating mandate set on Wednesday. The report on sustainable marine fuels (FuelEU Maritime) was adopted by 451 votes in favor, 137 against and 54 abstentions. The Commission had proposed lower reduction targets.

The reduction targets are to be achieved through the use of more sustainable marine fuels. The new rules apply to ships of more than 5,000 gross tons, which are responsible for 90 percent of CO2 emissions in maritime shipping. In addition, at least 2 percent synthetic e-fuels or so-called renewable fuels of non-organic origin (RFNBOs) are to be used from 2030.

Swedish rapporteur Jörgen Warborn (EPP) stressed that the Parliament’s position ensures that climate targets are met, the competitiveness of the maritime sector is maintained and carbon leakage and loss of labor are prevented.

Higher RFNBO quotas fail

However, some members of Parliament accuse Warborn of pursuing the interests not of the industry but of the mineral oil companies with this proposal. Tiemo Wölken (SPD) had proposed setting a 6 percent quota for 2035 in addition to the 2 percent quota for RFNBOs by 2030. “We need synthetic fuels such as ammonia, methanol or synthetic marine diesel to make shipping climate neutral,” he explained. However, his proposal was rejected by the EPP and now also by the plenary.

Wölken says his demands are broadly supported by the shipbuilding and mechanical engineering industries, the hydrogen industry, shipping companies and the logistics sector. He, therefore, finds it “absurd that the EPP, which otherwise never misses an opportunity to spout phrases about innovation, jumps ship when it comes to promoting innovation”. The background to the criticism is also that the EPP had insisted on the ramp-up of e-fuels in road transport but only wants to use them in small quantities in shipping.

Warborn defended the rejection of a 6 percent quota, pointing out that the Commission’s proposal does not include one at all. Moreover, it is not yet known what quantities of RFNBOs will be available for shipping. Should the availabilities allow it, the quota could still be increased, the Swede said.

Discrepancy FuelEU Maritime and ETS Maritime

Proposals to expand the scope of FuelEU Maritime to include ships of more than 400 gross tons, as well as geographic coverage, also failed to receive majority support. Instead, voyages that start or end outside the EU are only half considered. Expanding the scope would have aligned with Parliament’s position on including shipping in the European Emissions Trading System (ETS). The EPP’s rejection is particularly surprising because EPP MEP Peter Liese is responsible for the ETS reform in the trilogue.

Warborn justified his stance by saying that the expansion to smaller ship types would mean only 6 percent more emissions savings and thus “wouldn’t have much of an impact.” He also sees no reason why ETS and FuelEU Maritime need to be aligned.

This prompted the Greens to reject the report outright in Wednesday’s vote. The Social Democrats also do not share the rapporteur’s view but ultimately voted in favor of the report because the regulation sets binding rules for the first time ever, explains Wölken. “Even if the targets are not ambitious enough for us and for large parts of the industry, at least we are now setting a starting signal.” luk

CDU/CSU calls for mining renaissance in Germany

The CDU/CSU parliamentary group in the Bundestag wants to strengthen domestic mining again for raw materials extraction and speed up approval procedures in Germany for this purpose. This emerges from a motion for a resolution which the CDU/CSU intends to introduce in the Bundestag on Friday and which Table.Media received in advance.

In it, the parliamentarians call for:

a raw materials summit with the federal states and industry
the adaptation of corresponding laws
the examination of a raw material stockpiling reserve for the resilience of companies against supply chain interruptions.

In this way, the CDU/CSU parliamentary group is drawing attention to the threat to the German economy posed by the shortage of raw materials, supply bottlenecks and significant price increases. In total, it is calling for 19 measures from the German government. “In addition to measures to strengthen the circular economy and increase resource efficiency, greater German involvement in the extraction of raw materials at home and abroad is also required,” the document states.

At the German and European level, the German government must work to establish new partnerships with third countries and provide political and financial support for the raw materials activities of German companies abroad. The Japanese raw materials agency JOGMEC could serve as a model. Trade agreements such as the modernized EU-Chile Association Agreement and CETA must be ratified as quickly as possible.

“The traffic light coalition promise to facilitate domestic raw materials mining has so far waited in vain for implementation,” said Stefan Rouenhoff, the rapporteur of the Bundestag parliamentary group for raw materials policy. Approval procedures that are completed in just a few weeks in Canada, for example, would take many years in Germany. “The federal government must show leadership here, bring the states and industry to the table for a raw materials summit and adopt measures to speed up planning and approval procedures.”

Parliamentary State Secretary Franziska Brantner (Greens), who is responsible for the raw materials strategy in the Federal Ministry for Economic Affairs, said on Tuesday at an event organized by the NGO alliance Arbeitskreis Rohstoffe that she wanted to prevent Germany from going it alone. Instead of developing a new raw materials strategy, she said, the German government would develop key points and incorporate them into the German circular economy strategy and the European raw materials law. The EU Commission will present a draft in early 2023. leo

Habeck: ‘Can’t start a trade war with the US’

Germany and France want to prevent further trade disputes with the United States through negotiations. “We can’t enter into a trade war in times like this,” said German Economy Minister Robert Habeck in Berlin on Wednesday. However, fair competitive conditions should not be abandoned by the United States. This is currently threatening to happen. The EU Commission, which is responsible for European trade policy, must find a decisive answer to this. The talks on this are good, he said.

The Green politician was referring to a package of bills from the Biden administration that would provide government aid for certain industries, such as the auto industry. European companies could be disadvantaged in the process. Habeck said these were strong subsidies intended to lure companies to the United States. France’s Economy Minister Bruno Le Maire added at a joint press conference that there is no need for ramping up sanctions against each other. “There is a need to talk.” rtr

Andreas Baumüller – champion for nature conservation

The Tiroler Lech Nature Park led the Austrian Andreas Baumüller to Brussels. He calls it the first great success of his career that his involvement prevented a hydroelectric power plant in the 1990s. In 2000, the Tiroler Lech became part of the Natura 2000 network of protected areas.

That was the first contact the forestry graduate had with the European Union. After a few years, he decided that he could do more for his homeland at the level of European politics and moved to Belgium. Since 2012, he has been Head of Natural Resources at the Brussels office of the World Wide Fund for Nature (WWF).

Nature conservation and business are not opponents

With his commitment, he even broke an EU record in 2015: In the Nature Alert campaign for the protection of EU nature conservation law, more people got involved than ever before in a public consultation process. Baumüller was a co-organizer alongside many other NGOs at the time.

Born in Innsbruck in 1970, he does not describe himself as a pure nature conservation lobbyist. “My concern is that we have a pleasant home and give nature the respect it deserves.” Without this attitude, sustainability in business is also not guaranteed. Social, economic and conservation goals must be balanced, in his view. He works for an equitable balance of these three areas.

“One problem is that we focus on the short-term economy. The medium- and long-term economy also needs climate targets.” One of the problems Baumüller sees here is that politicians are usually elected because of their short-term goals. The understanding for a more long-term approach, however, is already there, he says. What is missing, he says, is implementation at the end. “If we just went by what many politicians claim, we should have saved biodiversity three or four times over the course of my career – and fixed climate change at an even higher rate.”

Renaturation and biodiversity

However, the head of the department for nature conservation sees the development of recent years as fundamentally positive. There are more discussions at the political level that revolve around nature’s potential. A good example of this is the EU Commission’s proposed directive from this year: Renaturation of forests and peatlands for binding CO2 from the atmosphere and more biodiversity.

The latter is the focus of his work for WWF, along with the protection of streams and forest areas. “Without biodiversity, the world would be so monotonous.” Behind his house, he does his bit through a meadow orchard and a few beehives. Even a rare little owl has taken up residence there in the meantime. Kim Fischer