Table.Briefing: Europe

Electricity shortage in France + Europe’s response to IRA + Michel in Beijing + Delegated Act hydrogen

  • France prepares for power outages
  • Europe’s response options to the IRA
  • Michel is not being heard in Beijing
  • Hydrogen: shorter transition period in Delegated Act
  • IEA Director Fatih Birol warns Germany against fracking
  • Eurogroup: Greece to receive debt relief
  • EU decides on $60 price cap for Russian oil
  • Due diligence: Council decides on special role for financial sector
  • EU environment committee wants export ban on plastic waste
  • Vandenberghe to become new director of DG CLIMA
  • Social redistribution of Mafia property: France takes after Italy
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No, blackouts, i.e., an uncontrolled and unforeseen failure of network elements, will not occur in France, said Emmanuelle Wargon, president of the regulatory authority CRE. Nevertheless, the situation is tense. Depending on the scenario, France faces the threat of 20 to 70 hours of power outages in winter. In their text, Tanja Kuchenbecker and Manuel Berkel analyze if and when the risk for the German grid increases.

Manuel Berkel also reports on the long-awaited Delegated Act on hydrogen. Europe.Table has the latest draft and it contains some important changes.

Is anything happening with the US Inflation Reduction Act (IRA)? Joe Biden held out the prospect of improvements to Emmanuel Macron during the latter’s visit to the White House, “which could, in principle, make it easier for European countries to participate.” The EU is also discussing several options on how to deal with the IRA, ranging from countering it to equalizing arms, ahead of the EU summit on Dec. 15. Till Hoppe outlines the options.

Meanwhile, EU Council President Charles Michel was in China trying to resume talks with President Xi Jinping after the failed EU-China dialogue in early April. The talks touched on many topics – human rights, equality in economic relations, the recent protests in China. But although a clear focus was lacking, Michel’s visit was a good start for a beginning of talks, according to Amelie Richter.

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Lisa-Martina Klein
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Feature

France prepares for power outages

It is becoming increasingly clear that France will have to deal with power supply bottlenecks in winter. The European Association of Network Operators ENTSO-E confirmed yesterday in its Winter Outlook that there could be power outages for tens of hours in winter.

Due to the support of neighboring countries, the situation has actually improved slightly compared to forecasts from October. The extended lifetime of German nuclear power plants helps other countries – including France – in the winter, said ENTSO-E’s lead expert Cindy Bastiaensen yesterday when asked by Europe.Table.

Prime Minister convenes crisis team

However, in their reference scenario, Europe’s grid operators still expect that electricity demand in France will not be met for a total of 20 hours next winter. The number may seem small, but even short and localized outages would interfere with people’s lives.

France’s Prime Minister Élisabeth Borne has been assembling a crisis team every week for the past month, and the government has developed an emergency plan. Prefects are instructed to prepare for controlled interruptions in supply of two hours. These are to be local shutdowns that do not affect entire cities or departments. Experts do not expect large-scale, unplanned outages. Emmanuelle Wargon, president of the regulator CRE, said, “There will be no blackouts.”

Mobile communications canceled, schools remain closed

According to the government, local outages could affect about 60 percent of the population. According to the network operator RTE, the risk is greatest during peak hours between 8 a.m. and 1 p.m., and between 6 p.m. and 8 p.m. If power were to be interrupted, the affected population would be informed by 5 p.m. the day before via the Ecowatt app.

Hospitals and other important facilities, such as the fire department and police, are to be spared. Internet, landlines and cell phones will not work during the outage. Trains and the metro will not run, and schools will be closed. It is still questionable whether the central emergency number 112 will work everywhere.

The reason is the situation in the French nuclear power plants. Utility EDF told Europe.Table that 21 of 56 nuclear reactors were not running at the end of November. Maintenance work, corrosion problems, the pandemic and strikes have slowed EDF down.

Eleven reactors are still scheduled to be restarted in December, but the French network operator RTE expects that this could drag on into January. The remaining reactors are scheduled to be shut down by February. EDF is already a long way behind the plan that the utility published in mid-September, according to which only nine reactors should not be running at present.

Power outages between 20 and 70 hours in winter

According to the latest RTE forecast from mid-November, European network operators also expect the situation to worsen overall. The ENTSO-E forecast of 20 hours with power outages is based on data from September. With the latest figures from France, the association now expects the number of hours with power outages to be between two scenarios of 20 and 70 hours.

According to ENTSO-E, the danger can be significantly reduced by saving electricity. The EU energy ministers have decided that all states should save ten percent of electricity consumption and cap consumption by five percent at peak times.

Electricity savings still behind expectations

Savings efforts are still falling short of the resolutions. Since October, the decline in electricity consumption has been noticeable. Compared to the years 2014 to 2019, it is in some weeks up to 6.7 percent below. However, the trend is increasing. Energy is being saved mainly in industry settings, less so in private households.

A government plan from early October calls for a 10 percent reduction in energy use over the next two years compared to 2019, including less heating in public buildings, less lighting and colder swimming pools.

But another key to security of supply, according to ENTSO-E, is for EU countries to support each other rather than, say, stop each other from exporting electricity. “If each country were to play for itself, the risks would be much higher,” Bastiaensen said.

France currently imports electricity mainly from Germany and Belgium and partly from Spain and the UK. France has agreed with Germany that Germany will supply electricity and France will supply gas. France’s sovereignty in energy is dwindling. Nicolas Goldberg, an energy expert at Colombus Consulting points out, “The situation is severe.”

Germany must secure supply from gas-fired power plants

The situation is not only tense this winter. For 2023, the outlook is not much better. EDF hopes for a supply of 300 to 330 terawatt hours (TWh) of energy; normally, the production from a nuclear power plant is 370 to 400 TWh.

“Next year, France will have to continue importing,” Goldberg said. For 2024, he said, everything depends on how maintenance work goes, renewable energy is expanded and whether the new pressurized water reactor EPR in Flamanville comes online.

ENTSO-E does not expect any negative effects on Germany. Even in the newly calculated extreme scenario, there would be no load shortfall in Germany. However, neighboring Poland would experience power outages of up to ten hours, and the situation in Sweden would also worsen.

The tense situation in neighboring countries would then also increase the risk for Germany, according to the report. It is, therefore, of utmost importance to secure gas supplies to gas-fired power plants even in the event of a shortage. Tanja Kuchenbecker, Manuel Berkel

  • Electricity market
  • Energy
  • France
  • Nuclear power

Europe’s response options to the IRA

Emmanuel Macron was received in Washington with a big station. US President Joe Biden had more than just warm words for his guest from France. He also held out the prospect of improvements to the Inflation Reduction Act (IRA) and the US Chips Act. “There are improvements we can make that can basically make it easier for European countries to participate or stand on their own,” Biden said. He and Macron had discussed the issue at length, he said.

The IRA, a roughly $400 billion US climate program, was Macron’s main concern along with the Ukraine war. In the other EU states, too, close attention was paid to whether the French president could achieve changes in implementation in Washington. Following him, the EU Commission delegation led by Margrethe Vestager and Valdis Dombrovskis will now travel to the United States, meeting their US counterparts at the Trade and Technology Council (TTC) on Monday (the draft final declaration can be found here).

Limited financial scope

After the TTC, the EU states then want to make an initial assessment. The issue is likely to occupy the heads of state and government at the EU summit on Dec. 15. This is because there is great concern that many industrial companies prefer to invest abroad in view of the high energy prices in Europe and the enticing calls from Washington (and Beijing).

Top politicians such as Macron and Vestager are currently holding talks with CEOs in an attempt to dissuade the companies. But appeals will hardly suffice. Governments at national and European level must now decide in the short term how to respond. The financial leeway is limited – the EU states have already earmarked €600 billion for aid in the energy crisis alone.

The following options are being discussed:

Trade conflict: willpower is missing

The EU could take action against the passages in the IRA that link subsidies to production in North America – which is clearly not compatible with World Trade Organization rules. But hardly anyone wants that in the current political world situation, with the possible exception of France.

An EU versus US case at the WTO would generate headlines around the world, but would be unlikely to produce timely results given the paralysis of the Geneva dispute settlement mechanism. At last week’s Trade Council, many ministers stressed that the dispute over the IRA should not undermine transatlantic relations. EU tools such as the Foreign Subsidies Instrument are also inappropriate here, according to Brussels.

Foreclosure: conflict with commercial law

The EU could follow Washington’s lead and erect its own hurdles for foreign companies. Macron has been drumming up support for a “Buy European” act for weeks. In Germany, Minister for Economic Affairs and Climate Action Robert Habeck shows some sympathy for it.

He brought up the idea of taking criteria such as the carbon footprint into account when promoting the production of solar panels or wind turbines – which would favor “more regional production”. However, the EU could hardly afford to blatantly ignore WTO rules in the process. “We should not copy what we don’t like in others,” warns a senior EU diplomat.

Industrial policy: subsidies and less bureaucracy

Germany and France are pulling in the same direction here: “We need a second phase of the Green Deal: from regulation to a green industrial policy,” said State Secretary for Economic Affairs Sven Giegold yesterday at the Competitiveness Council in Brussels.

The issue offers a welcome opportunity after the recent dissonances to get the Franco-German engine running again. Even traditionally skeptical states like the Netherlands could get involved, according to diplomats – provided Paris and Berlin coordinate closely with their partners.

The industrial policy approach would hit two birds with one stone: new subsidies for climate-friendly technologies and less bureaucracy.

  • On Wednesday evening, Internal Market Commissioner Thierry Breton launched the new Clean Tech Europe industry platform. As a first step, the Commission, member states and industry agreed to set up a political steering body and working groups to quickly present concrete options for action.
  • The Commission and the German government are also in favor of launching further IPCEI projects. These could be linked to ongoing projects that are already promoting projects in climate-friendly technologies such as batteries or hydrogen. The IPCEI framework allows member states to provide generous subsidies to industry, but the requirements, such as the innovative nature of the projects, are quite high. It sometimes takes two years for projects to be coordinated across borders and approved by the Commission.
  • Habeck wants to speed up the IPCEI procedure and make it easier for companies to get started even before final approval. However, the Federal Ministry for Economic Affairs and Climate Action (BMWK) itself is also called upon to do this, according to industry circles: At present, the ministry is delaying many projects because it is not giving the go-ahead for the early start of measures.
  • Politically more explosive is Habeck’s call to also facilitate subsidies in the mass production of climate-friendly technologies. Currently, this is only possible under state aid law on a case-by-case basis or in a separate legal framework such as the Chips Act. Giegold warns, “If our own rules ensure that there is no more production here, then we have thrown the baby out with the bathwater.” However, state aid experts warn against now puncturing the uniform legal framework with special rules for more and more sectors. Competition Commissioner Vestager also opposes such proposals.

Funding: new ways and old pots

Berlin and Paris are therefore looking for ways to avoid the problems with state aid law and win over the Commission to their cause. One way: to at least partially Europeanize industrial aid. “Otherwise, we would have unfair competition within Europe between those who can pay and those who can’t,” says Giegold. First, however, the skeptics have to be convinced – in Berlin’s coalition, that’s the FDP.

  • For example, the new REPowerEU pot, which is to contain €20 billion in fresh funds, could be tapped for this purpose. This is intended to reduce Europe’s dependence on fossil fuels from Russia – for example, by promoting solar systems or heat pumps. This could possibly also stimulate investments in these areas, according to Brussels.
  • Further funds for REPowerEU could possibly be mobilized from the Corona reconstruction program Next Generation EU: There, €220 billion are still available for loans that member states have not yet drawn upon. As soon as the REPowerEU regulation comes into force, the member states have 30 days to apply for the loans. What is not called upon could be reallocated, according to the ideas from Brussels.
  • In response to the IRA, another pot could also be tapped: the Innovation Fund. This is fed by the revenue from emissions trading and is intended to promote innovative climate-friendly technologies to the tune of around €38 billion by 2030. The upside of this is that the money from the fund is not considered state aid – and could therefore offer a way out of the political dispute.

What the industry says

In terms of financial volume, the IRA and REPowerEU are quite comparable. While the EU Commission is making around €300 billion available, the US government is providing almost $400 billion for a wide range of areas. According to an overview by McKinsey, $250 billion of this will go to the energy sector. Many in the business community see the crucial difference more in the simpler procedures for accessing the funds.

The US logic: Depending on how much a company reduces CO2 emissions, it can reduce its taxes in stages, explains Torsten Oltmanns of the Center for Sustainable Transformation. This is the case with the hydrogen megatrend, for example: As long as the production of one kilogram of hydrogen does not cause more than four kilograms of CO2, tax breaks apply.

The full rebate is available if the CO2 intensity is below 450 grams per kilo of the energy carrier. For the association Hydrogen Europe, the IRA has clear advantages: “This law offers a much clearer, easier to understand funding instrument,” CEO Jorgo Chatzimarkakis said recently in an interview with Europe.Table.

The wind power industry is calling for faster approval procedures in particular – projects with 80 gigawatts are currently waiting for approval in Europe, criticizes the Wind Europe association. In addition, the criteria for the tenders should be changed: Not only the price should decide, but also sustainability criteria. with Manuel Berkel

  • Climate & Environment
  • Climate protection
  • Financial policy
  • Industriepolitik
  • REPowerEU

Michel is not being heard in Beijing

EU Council President Charles Michel has called on Beijing, during his visit to China, to press Moscow to end the war in Ukraine. “We are counting on China to use its influence,” Michel said after talks with state and party leader Xi Jinping.

He said Xi had clearly assured him that the People’s Republic would not supply weapons to Russia and rejected nuclear threats. “President Xi and I agreed that nuclear threats are unacceptable and highly dangerous.”

The country has a special responsibility as a UN veto power to ensure that the UN Charter is respected, the EU Council president added. The Belgian said he hoped China would use all means in the coming weeks and months to “convince” Russia to end the war and respect Ukraine’s sovereignty. There was no joint press statement after the meeting; both sides issued their own statements.

‘Dialogue of the deaf’

Since the beginning of the Russian invasion of Ukraine, the EU has been appealing to the Chinese leadership to put pressure on Russia’s President Vladimir Putin. So far, however, with very limited success. Belief in Beijing’s influence had declined massively, especially after the unsuccessful EU-China dialogue in early April.

The EU’s foreign affairs representative Josep Borrell had subsequently dubbed the video summit a “dialogue of the deaf”. A recorded video message by Michel himself, intended for the opening of the export fair in Shanghai, was not shown on purpose. In it, the EU Council leader had called on Russia to stop the bloodshed in Ukraine.

China to support EU in ‘mediation’

The message from the Chinese side after the meeting also stated that Ukraine was discussed. However, the word “war” was still not used, only a “crisis” was mentioned. During the talks, Xi Jinping insisted on a political solution through negotiations, state broadcaster CCTV reported.

Xi was quoted as saying that “resolving the Ukraine crisis by political means is in the best interests of Europe and in the common interests of all countries in Eurasia.” Under the current conditions, escalation and expansion of the crisis must be avoided, Xi said, according to state media.

The devil is in the details: China “supported the EU in strengthening its mediation,” the Chinese statement stated. The People’s Republic also cited an “establishment of a balanced, effective and sustainable European security architecture.” This wording can already be found in a similar way in the joint statement issued by Russia and China at the beginning of February this year, criticizing a possible NATO expansion in Europe.

‘Constructive role’ of China

Another choice of words in the Chinese statement is noteworthy, Justyna Szczudlik, a China analyst at the Polish Institute of International Affairs (PISM) in Warsaw, writes on Twitter: it says China is always on the side of peace and will “continue to play a constructive role in its own way,” as Szczudlik writes. She summarizes, “Let me be clear: this is like ‘constructive role with Chinese characteristics’ = endorsing Russia.” Beijing’s timely response to the EU appeal remains unlikely, even after the meeting.

Communication after the meeting also varied on other topics, with the EU Council President assuring that he had addressed the recent protests in China. “In a broader sense, there was an exchange about Covid and the experiences in Europe and China, including the respective measures taken and the response of the societies,” a spokesperson for Michel said after the three-hour meeting. However, the Chinese statement did not mention this point. Members of the EU Parliament, in particular, had called for a clear signal from the EU Council President to the Chinese leadership before Michel’s trip.

Equality and fairness in business

Beijing, meanwhile, sought to emphasize the common ground between the two economic blocs. In doing so, Xi sought to show positivity and improve relations with Brussels amid Beijing’s growing rivalry with Washington. Brussels and Beijing have no “real strategic differences or conflicts,” Xi said. He hoped they could join forces to jointly “resist decoupling,” Xi was quoted as saying by Chinese state media.

At the same time, Michel insisted on more equality and fairness in economic relations with China. There must be equal access for European companies in China and for Chinese companies in the EU’s internal market. The background is complaints from European companies about restrictions in China. “We do not want excessive dependence,” Michel stressed. He also stressed that European companies would be willing to supply vaccines to China if they were approved there.

Xi: working on advancing the CAI

Accordingly, Xi also came to talk about a permanent construction site: Both sides were working on advancing the CAI investment agreement. This part of the conversation did not make it into the EU’s statement. Michel did, however, have the opportunity to raise the issue of human rights in general. The EU Council President had stressed the universality of fundamental freedoms and “reaffirmed the EU’s commitment to its ‘One-China Policy’ and recalled the EU’s long-standing position on the Taiwan Strait.”

The first meeting was rich in topics, even if a clear focus was missing. For the resumption of personal talks, however, Michel’s visit was a start. The consensus on trade issues emphasized above all by Xi – and subsequently also by the state media – was certainly also intended to send a signal in the direction of Washington. EU and US representatives met there on Thursday for a dialogue on China and the Indo-Pacific.

  • Charles Michel
  • China
  • European policy
  • Xi Jinping

EU-Monitoring

Dec. 5-6, 2022
Council of the EU: Transport, Telecommunications and Energy
Topics: General approach on the revision of the regulation on Union guidelines for the development of the trans-European transport network, Approval of the conclusions on the ongoing development of inland waterway transport, Information from the Presidency and the Commission on the transport relations with Ukraine. Draft Agenda

Dec. 5, 2022; 3-6:30 p.m.
Meeting of the Committee on Budgetary Control (CONT)
Topics: Draft report on the protection of the EU’s financial interests, Draft report on the Control of the financial activities of the European Investment Bank, Public Hearing on Instruments and tools at EU level and developed at Member States’ level to prevent and tackle fraud and financial and economic crimes. Draft Agenda

Dec. 5, 2022; 3-6:30 p.m.
Meeting of the Committee on Industry, Research and Energy (ITRE)
Topics: Draft opinion on laying down harmonised conditions for the marketing of construction products, Exchange of views with Cristina Lobillo Borrero (Director of the Energy Platform Task Force) on the state of play of the Energy Charter Treaty and the way forward. Draft Agenda

Dec. 5, 2022; 3-6:30 p.m.
Meeting of the Committee on Civil Liberties, Justice and Home Affairs (LIBE)
Topics: Draft opinion on the proposals of the European Parliament for the amendment of the treaties, Exchange of views on the Interpol’s role in the EU’s Security Architecture, State of play of negotiations on Readmission Agreements and arrangements. Draft Agenda

Dec. 5, 2022; 3-6:30 p.m.
Meeting of the Committee on Security and Defense (SEDE)
Topics: Exchange of views on the EU military operation EUFOR Althea and the security situation in Bosnia and Herzegovina, EU’s support in providing lethal military equipment for Ukraine, Exchange of views on the situation in Ukraine Draft Agenda

Dec. 5, 2022; 3-6:30 p.m.
Meeting of the Committee on Human Rights (DROI)
Topics: Exchange of views on the recent demonstrations in China, Exchange of views with Christophe Deloire (Secretary General of Reporters Without Borders), Public hearing on the African Union and its human rights and democracy mechanisms. Draft Agenda

Dec. 5, 2022; 3-6:30 p.m.
Meeting of the Committe on Constitutional Affairs (AFCO)
Topics: Draft opinion on the information security in the institutions, bodies, offices and agencies of the Union. Draft Agenda

Dec. 5, 2022; 3-6:30 p.m.
Meeting of the Committee on the Environment, Public Health and Food Safety (ENVI)
Topics: Exchange of views with the Commission on the upcoming IMO MEPC 79 session, Exchange of views with the citizens’ spokesperson for public health matters in the Conference on the Future of Europe, Exchange of views with the Commission and United Nations Environment Programme (UNEP) on the state of play of negotiations of a Global Treaty on Plastic Pollution. Draft Agenda

Dec. 5, 2022; 3-4:30 p.m.
Joint Meeting of the Committee on the Economic and Monetary Affairs (ECON) and of the Committee on the Environment, Public Health and Food Safety (ENVI)
Topics: Exchange of views with Mairead McGuinness (Commissioner for financial services, financial stability and Capital Markets Union) on the state of play in the developments of the remaining technical screening criteria and on the work of the Platform on Sustainable Finance. Draft Agenda

Dec. 5, 2022; 4:30 p.m.
Euro Group
Topics: Assessment of euro area Member States’ Draft Budgetary Plans and of the budgetary situation and prospects of the euro area, Euro area recommendations for 2023 (presentation by the Commission), Commission Communication on orientations for a reform of the EU economic governance framework. Draft Agenda

Dec. 6, 2022; 10 a.m.
Council of the EU: Economic and Financial Affairs
Topics: Council Implementing Decision on measures for the protection of the Union budget against breaches of the principles of the rule of law in Hungary, State of play of the implementation of the Recovery and Resilience Facility, Policy debate on the revision of the energy taxation Directive. Draft Agenda

Dec. 6, 2022; 10:15 a.m.-2:30 p.m.
EU-Western Balkans Summit
Topics: Cooperation in the face of common challenges stemming from Russia’s aggression against Ukraine, Ways of deepening political and policy engagement (with a particular focus on young people), Coordinated actions on security and defence issues. Infos

Dec. 7, 2022
Weekly Commission Meeting
Topics: VAT in the Digital Age, Administrative cooperation in taxation (DAC 8), Strengthening capital markets package, Equality package. Draft Agenda

Dec. 8-9, 2022
Council of the EU: Justice and Home Affairs
Topics: Adoption of the Council Decision on the full application of the provisions of the Schengen acquis in Bulgaria and Romania, Partial general approach on the regulation on addressing situations of instrumentalisation in the field of migration and asylum, Exchange of views on Russia’s aggression against Ukraine. Draft Agenda

Dec. 8-9, 2022
Council of the EU: Employment, Social Policy, Health and Consumer Affairs
Topics: General approach on the directive on improving working conditions in platform work, Policy debate on the European Care Strategy, Information from the Commission on the European Union Global Health strategy. Draft Agenda

Dec. 8, 2022
ECJ ruling on the right to be forgotten
Topics: Several articles appeared on the website of a US company in 2015 that were critical of the investment model of various financial services companies. For its part, the business model of the company operating the website was reported critically, among other things with the accusation that it was trying to blackmail other companies by first publishing negative reports and then offering to delete the reports or prevent the negative reporting in exchange for a so-called protection money. Against this backdrop, the Federal Court of Justice asked the ECJ to interpret the General Data Protection Regulation and the EU Charter of Fundamental Rights. Request

Dec. 8, 2022; 9 a.m.-12:30 p.m.
Meeting of the Committee on Agriculture and Rural Development (AGRI)
Topics: The Committee on Agriculture and Rural Development (AGRI) meets for consultations. Draft Agenda

Dec. 8, 2022; 2-5:30 p.m.
Meeting of the Committee on Internal Market and Consumer Protection (IMCO)
Topics: Draft opinion on harmonized rules on fair access to and use of data (Data Act), Draft opinion on Corporate Sustainability Due Diligence, Draft opinion on the EU Strategy for sustainable and circular textiles. Draft Agenda

Dec. 11-12, 2022
Council of the EU: Agriculture and Fisheries
Topics: State of play of the regulation on the sustainable use of plant protection products, Exchange of views on the evaluation of the EU animal welfare legislation, Exchange of views on the market situation in particular following the invasion of Ukraine. Draft Agenda

News

Hydrogen: shorter transition period in Delegated Act

For the production of hydrogen, the Commission wants to shorten the transition period in which facilitated conditions apply. The deadline is now March 31, 2028, according to a new version of the Delegated Act dated Wednesday and obtained by Europe.Table. In a July leak, the transition period was still valid until the end of 2029.

In return, however, the Commission wants to further simplify the conditions for so-called temporal additionality in the transition phase. Several criteria for additionality are intended to ensure that liquid or gaseous renewable fuels of non-biogenic origin (RFNBOs) are produced with additional renewable electricity and do not, for example, boost the electricity production of fossil power plants.

Quarter instead of month for temporal correlation

The requirements relate to the constellation in which the electrolyzer for hydrogen production obtains its electricity from the public grid and the operator has concluded a long-term supply contract (PPA) with a green power producer. After the transition period, the temporal connection between electricity generation and electrolysis must be proven on an hourly basis.

In the transition period, facilitated conditions apply. According to the July leak, the temporal context was to be extended to the calendar month. According to the new draft, even a calendar quarter is now to suffice for the evidence.

Greens criticize certificate tricks with coal-fired power

The Commission writes in the recitals that this is intended to take account of technological hurdles in measurement, the design of electrolyzers and the necessary infrastructure for storing and transporting hydrogen. For the Greens, however, the shortened deadline still goes too far.

“It is good that the Commission is demanding that green hydrogen be produced with additional renewable energies and not simply with electricity from the grid. This will accelerate the expansion of solar and wind power and bring us a step closer to Europe’s energy independence and climate neutrality,” says MEP Michael Bloss. “However, the transition period envisaged by the Commission is far too long. Until 2028, certificate tricks and the production of green hydrogen with nuclear, coal and gas power will be allowed.” ber

  • E-Fuels
  • Energy
  • Energy policy
  • Hydrogen
  • Renewable energies

IEA Director Fatih Birol warns Germany against fracking

The head of the International Energy Agency (IEA), Fatih Birol, warns Germany against entering fracking. “If Germany starts fracking today, it will take forever for the first gas from it to reach the market. I would be very cautious about that,” he told Table Media. “The risk of not being able to take advantage of this investment is huge.

Fracking, the extraction of natural gas under high pressure from artificially created cracks in bedrock, is prohibited by law in Germany. In view of the energy crisis, Finance Minister Christian Lindner (FDP) has called for an end to the ban. Minister for Economic Affairs and Climate Action Robert Habeck (Greens) and Chancellor Olaf Scholz (SPD) are opposed.

With regard to possible gas supply contracts between Germany and Senegal, Birol urged caution. “The contract periods must be chosen wisely. It must be possible to use the gas infrastructure later for ammonia or hydrogen,” he said. “And the energy needed to liquefy the gas should come from renewable sources.” ae

  • Climate Policy
  • Energy
  • Energy policy
  • Germany

Eurogroup: Greece to receive debt relief

The finance ministers of the 19 euro countries want to give the green light for a final package of measures to relieve Greece’s debt at the next meeting of the Eurogroup on Dec. 5. According to a high-ranking EU official, this underlines the appreciation and respect of the euro partners regarding the reforms carried out by Greece in recent years.

The country has been released from enhanced macroeconomic surveillance following the financial crisis in August 2022 but still had some final measures to implement. On Nov. 22, the European Commission presented its first report on the situation in Greece following the enhanced surveillance.

In the report, the EU authority stresses that the government in Athens has now implemented the reforms it agreed on with the European institutions. It also says the country is able to service its debt on outstanding bonds issued by the euro bailout fund (EFSF, ESM) and other bilateral lenders.

In view of the decision of the euro finance ministers, the Commission’s report suggests that Greece be given a final transfer in the amount of €644 million. This is related to the Greek bonds held by the national central banks of the monetary union, which the central banks acquired under the Securities Markets Program between 2010 and 2012.

In addition, Greece is to be waived an interest premium of €123 million on various EFSF bonds for the second half of 2022. Furthermore, the interest rate premium, which can be up to 200 basis points, is to be persistently set at zero from 2023 to 2049. This corresponds to potential payment relief for Athens of around €5.2 billion over the period mentioned. cr

  • European policy
  • Finance
  • Greece

EU decides on $60 price cap for Russian oil

According to diplomats, the EU states have agreed on a price cap of $60 per barrel for Russian oil transported by sea. With an adjustment mechanism, the cap should also always be kept at five percent below the market price, an EU diplomat told the Reuters news agency.

Poland, which has insisted on the lowest possible price cap, must still approve the agreement on Thursday. If it does, the deal could be signed by all EU governments by Friday. The deal takes up a plan by the seven largest industrialized nations (G7) and would replace an EU decision that Russian oil may not be landed in Europe at all, starting Monday.

The aim is to reduce Russia’s revenues on the one hand. For this reason, Poland and the Baltic states in particular are campaigning for a low price. On the other hand, the global oil price should not be driven up by a complete import freeze, as Russia produces around ten percent of the world’s oil.

Russia’s reaction unclear

An important lever for implementing the price limit is to be that insurance companies and shipping companies may only participate in Russian business if the oil is sold below $60 per barrel. Although the world market price is currently below this level anyway, it could rise again when the global economy picks up.

It is unclear how Russia will react. The Kremlin indicated that states participating in a price cap would no longer be supplied at all.

Pipeline oil that flows to Europe is exempt from the EU sanctions. Hungary, among others, insisted on this. Germany, however, has declared that it will stop buying Russian oil via this route from 2023. The German government is therefore looking for another way to secure supplies to the Schwedt refinery in eastern Germany. rtr

  • Energy
  • Energy policy
  • Energy Prices

Due diligence: Council decides on special role for financial sector

France was able to assert itself. The Council compromise on the Due Diligence Act will not automatically be applied to the financial sector. It is up to each member state to decide whether financial services are covered by the law or not. The definition of the financial industries to be regulated has also been significantly limited, with investment funds, for example, being almost completely excluded.

With this proposal, the Czech Council Presidency managed to resolve the dispute within the member states over the scope of the law. France threatened with a blocking minority until the last minute if financial services had to perform due diligence.

Germany supports compromise

The compromise received a qualified majority in yesterday’s Competitiveness Council: the Council’s General Approach is thus in place. Germany supported the compromise yesterday. The Council’s proposal significantly weakens the Commission’s proposal in some points. For example, in the first year only very large companies with more than 1,000 employees and €300 million in annual sales are to be covered by the law. Arms exports and dual-use goods are excluded from the law.

Deputies and NGOs disappointed

However, the compromise text has also been met with criticism. Green Party politician Anna Cavazzini calls the special regulation for the financial center “scandalous and incomprehensible”. The EU should no longer tolerate investments in human rights violations, she said. The European SPD is more pragmatic: “Given the difficult starting position and tough opposition from some member states, this is probably the best possible outcome,” says Tiemo Wölken.

Among other things, environmental and human rights organizations are bothered by the fact that not all downstream activities, such as the use of products, are covered: “This would mean that agricultural companies, for example, would be in the clear, even if their pesticides damage the health of farmers and plantation workers,” writes the Supply Chain Act initiative.

Craftsmen’s association criticizes obligation to provide proof

For some stakeholders, however, the compromise goes too far: “De facto, every company in Europe will be affected by the massive bureaucratic requirements of the Supply Chain Act, as the obligations are simply passed down the chain,” criticizes Axel Voss (EPP), for example. The CDU politician is shadow rapporteur for the proposal in Parliament.

The German Confederation of Skilled Crafts (Zentralverband des Deutschen Handwerks, ZDH) agrees and calls for European supply chains to be exempted from the obligation to provide evidence of compliance with human rights and environmental standards, as this would threaten micro and small enterprises with “a considerable, hardly presentable and unreasonable administrative burden”.

In contrast to the Council, there is still no compromise text in Parliament. At the beginning of November, rapporteur Lara Wolters presented her proposal, which is significantly stricter than the Commission’s proposal.

  • European policy
  • Finance
  • Financial policy
  • Supply chains

EU environment committee wants export ban on plastic waste

The EU Parliament’s Committee on the Environment, Public Health and Food Safety (ENVI) on Thursday adopted its position on the so-called Waste Shipment Regulation. The members were in favor of completely phasing out the export of plastic waste to OECD countries within four years of the law coming into force.

Exports of so-called “non-hazardous waste” – that is, waste that does not harm human health or the environment – may only be exported to non-OECD countries with their consent. In addition, the recipient countries must prove that they are able to dispose of or recycle this waste sustainably.

Council orientation still pending

The Commission must draw up and publish the list of recipient countries annually. MEPs also call for the creation of a risk-based guide in the verification of waste exports to prevent and detect illegal waste shipments.

The regulation is part of the EU Commission’s circular economy package, which the authority presented at the end of last year. ENVI’s position must now be confirmed in the plenum of the EU Parliament. The general orientation of the Council is still pending and is expected under the Swedish Council Presidency at the earliest. luk

  • Climate & Environment
  • Climate protection

Vandenberghe to become new director of DG CLIMA

Belgian Kurt Vandenberghe, currently advisor to European Commission President Ursula von der Leyen on the Green Deal, Energy and Transport, will be the new head of the Directorate-General CLIMA.

Vandenberghe joined the Commission in 1996 and worked in DG MOVE (Mobility and Transport). He then worked in the cabinet of Belgian Research Commissioner Philippe Busquin (1999 to 2004) and headed the cabinet of his successor Janez Potočnik (2004 to 2009), whom he succeeded in the Environment portfolio under the presidency of Jean-Claude Juncker.

Prior to joining the Commission, Kurt Vandenberghe worked for four years as a manager at Ernst & Young Association Management, where he built, managed and represented international trade associations.

He will take office on Jan. 16, 2023, assuming the post that has been vacant since the death of former Director General Mauro Petriccione on Aug. 22. cst

  • EU
  • European Commission

Column

Social redistribution of Mafia property: France takes after Italy

By Claire Stam
Schwarz-weiß Portrait von Claire Stam

There is hardly anything ordinary about the La Poesia restaurant, which opened in Paris on Nov. 2, mainly because meals are prepared with products supplied by the Italian organization Libera Terra. The organization manages agricultural land that has been seized from the Mafia.

Even the cuvées are not ordinary: Each bottle honors on the label one of the many victims of the Mafia. In Paris, the fight against the Mafia thus harmonizes from now on with Italian culinary art. This is the task that the restaurant La Poesia, located at 3, Rue de la Fidélité in the 10th arrondissement of Paris, has set itself.

Restaurant staff for social reintegration

The restaurant, born of a family history between France and Italy, entered into a partnership unprecedented in France with the Italian organization Libera Terra. Libera Terra not only manages agricultural land seized by the judiciary and formerly owned by the Mafia. The organization also unites the work of agricultural cooperatives located on this land and selects them based on their compliance with social and environmental rules.

La Poesia, however, wants to go one step further: The restaurant is currently forging partnerships with French associations that work for social reintegration. The restaurant plans to recruit staff from the people who are under the protection of these associations. This approach mirrors Italian practices of reinvesting money and goods seized from organized crime in social institutions.

Trademark of Italian justice

The initiative of the restaurant La Poesia raises a question: What to do with goods that have belonged to criminals when the judiciary orders their confiscation? Strategies vary from country to country. France resells them at auctions and recovers the money for the treasury. Italy, where so-called preventive seizures have been in place since 1982 to combat the Mafia, passed a more innovative law in 1996 that allows assets seized from organized crime to be bequeathed to social causes.

This provision, recognized by the European Court of Human Rights in 2014, has become the hallmark of Italian justice. The country thus lists 40,000 seized properties, almost half of which have been redistributed. Thus, prestigious villas with swimming pools are transformed into vacation centers for disadvantaged children, tomato fields or olive trees are stamped “anti-Mafia” for production, or buildings are converted into administrative offices.

Idea finds imitators

The practice is still marginal in France despite the passage of an Italian-style law in 2021, but the Italian idea of social redistribution of goods taken from mobsters is gradually finding its way there. Former Justice Minister Nicole Belloubet was enthusiastic about the idea.

And in February 2020, Macron and then Italian Prime Minister Giuseppe Conte met in Naples for bilateral talks and publicly confirmed the project, even before the practical modalities were defined. Currently, the French administration has a long list of apartments, buildings and villas scattered throughout the country, confiscated from Mafiosi.

And as for La Poesia, it is not only a restaurant but also a place of culture. On Dec. 10, two well-known personalities of Italian justice, Antonio Balsamo, President of the Court of Palermo, and Francesco Menditto, Prosecutor of Tivoli, will be present. They will hold a meeting in their honor 30 years after the murder of their colleagues Giovanni Falcone and Paolo Borsellino.

  • France
  • Italy
  • Society

Europe.Table Editorial Office

EUROPE.TABLE EDITORS

Licenses:
    • France prepares for power outages
    • Europe’s response options to the IRA
    • Michel is not being heard in Beijing
    • Hydrogen: shorter transition period in Delegated Act
    • IEA Director Fatih Birol warns Germany against fracking
    • Eurogroup: Greece to receive debt relief
    • EU decides on $60 price cap for Russian oil
    • Due diligence: Council decides on special role for financial sector
    • EU environment committee wants export ban on plastic waste
    • Vandenberghe to become new director of DG CLIMA
    • Social redistribution of Mafia property: France takes after Italy
    Dear reader,

    No, blackouts, i.e., an uncontrolled and unforeseen failure of network elements, will not occur in France, said Emmanuelle Wargon, president of the regulatory authority CRE. Nevertheless, the situation is tense. Depending on the scenario, France faces the threat of 20 to 70 hours of power outages in winter. In their text, Tanja Kuchenbecker and Manuel Berkel analyze if and when the risk for the German grid increases.

    Manuel Berkel also reports on the long-awaited Delegated Act on hydrogen. Europe.Table has the latest draft and it contains some important changes.

    Is anything happening with the US Inflation Reduction Act (IRA)? Joe Biden held out the prospect of improvements to Emmanuel Macron during the latter’s visit to the White House, “which could, in principle, make it easier for European countries to participate.” The EU is also discussing several options on how to deal with the IRA, ranging from countering it to equalizing arms, ahead of the EU summit on Dec. 15. Till Hoppe outlines the options.

    Meanwhile, EU Council President Charles Michel was in China trying to resume talks with President Xi Jinping after the failed EU-China dialogue in early April. The talks touched on many topics – human rights, equality in economic relations, the recent protests in China. But although a clear focus was lacking, Michel’s visit was a good start for a beginning of talks, according to Amelie Richter.

    Your
    Lisa-Martina Klein
    Image of Lisa-Martina  Klein

    Feature

    France prepares for power outages

    It is becoming increasingly clear that France will have to deal with power supply bottlenecks in winter. The European Association of Network Operators ENTSO-E confirmed yesterday in its Winter Outlook that there could be power outages for tens of hours in winter.

    Due to the support of neighboring countries, the situation has actually improved slightly compared to forecasts from October. The extended lifetime of German nuclear power plants helps other countries – including France – in the winter, said ENTSO-E’s lead expert Cindy Bastiaensen yesterday when asked by Europe.Table.

    Prime Minister convenes crisis team

    However, in their reference scenario, Europe’s grid operators still expect that electricity demand in France will not be met for a total of 20 hours next winter. The number may seem small, but even short and localized outages would interfere with people’s lives.

    France’s Prime Minister Élisabeth Borne has been assembling a crisis team every week for the past month, and the government has developed an emergency plan. Prefects are instructed to prepare for controlled interruptions in supply of two hours. These are to be local shutdowns that do not affect entire cities or departments. Experts do not expect large-scale, unplanned outages. Emmanuelle Wargon, president of the regulator CRE, said, “There will be no blackouts.”

    Mobile communications canceled, schools remain closed

    According to the government, local outages could affect about 60 percent of the population. According to the network operator RTE, the risk is greatest during peak hours between 8 a.m. and 1 p.m., and between 6 p.m. and 8 p.m. If power were to be interrupted, the affected population would be informed by 5 p.m. the day before via the Ecowatt app.

    Hospitals and other important facilities, such as the fire department and police, are to be spared. Internet, landlines and cell phones will not work during the outage. Trains and the metro will not run, and schools will be closed. It is still questionable whether the central emergency number 112 will work everywhere.

    The reason is the situation in the French nuclear power plants. Utility EDF told Europe.Table that 21 of 56 nuclear reactors were not running at the end of November. Maintenance work, corrosion problems, the pandemic and strikes have slowed EDF down.

    Eleven reactors are still scheduled to be restarted in December, but the French network operator RTE expects that this could drag on into January. The remaining reactors are scheduled to be shut down by February. EDF is already a long way behind the plan that the utility published in mid-September, according to which only nine reactors should not be running at present.

    Power outages between 20 and 70 hours in winter

    According to the latest RTE forecast from mid-November, European network operators also expect the situation to worsen overall. The ENTSO-E forecast of 20 hours with power outages is based on data from September. With the latest figures from France, the association now expects the number of hours with power outages to be between two scenarios of 20 and 70 hours.

    According to ENTSO-E, the danger can be significantly reduced by saving electricity. The EU energy ministers have decided that all states should save ten percent of electricity consumption and cap consumption by five percent at peak times.

    Electricity savings still behind expectations

    Savings efforts are still falling short of the resolutions. Since October, the decline in electricity consumption has been noticeable. Compared to the years 2014 to 2019, it is in some weeks up to 6.7 percent below. However, the trend is increasing. Energy is being saved mainly in industry settings, less so in private households.

    A government plan from early October calls for a 10 percent reduction in energy use over the next two years compared to 2019, including less heating in public buildings, less lighting and colder swimming pools.

    But another key to security of supply, according to ENTSO-E, is for EU countries to support each other rather than, say, stop each other from exporting electricity. “If each country were to play for itself, the risks would be much higher,” Bastiaensen said.

    France currently imports electricity mainly from Germany and Belgium and partly from Spain and the UK. France has agreed with Germany that Germany will supply electricity and France will supply gas. France’s sovereignty in energy is dwindling. Nicolas Goldberg, an energy expert at Colombus Consulting points out, “The situation is severe.”

    Germany must secure supply from gas-fired power plants

    The situation is not only tense this winter. For 2023, the outlook is not much better. EDF hopes for a supply of 300 to 330 terawatt hours (TWh) of energy; normally, the production from a nuclear power plant is 370 to 400 TWh.

    “Next year, France will have to continue importing,” Goldberg said. For 2024, he said, everything depends on how maintenance work goes, renewable energy is expanded and whether the new pressurized water reactor EPR in Flamanville comes online.

    ENTSO-E does not expect any negative effects on Germany. Even in the newly calculated extreme scenario, there would be no load shortfall in Germany. However, neighboring Poland would experience power outages of up to ten hours, and the situation in Sweden would also worsen.

    The tense situation in neighboring countries would then also increase the risk for Germany, according to the report. It is, therefore, of utmost importance to secure gas supplies to gas-fired power plants even in the event of a shortage. Tanja Kuchenbecker, Manuel Berkel

    • Electricity market
    • Energy
    • France
    • Nuclear power

    Europe’s response options to the IRA

    Emmanuel Macron was received in Washington with a big station. US President Joe Biden had more than just warm words for his guest from France. He also held out the prospect of improvements to the Inflation Reduction Act (IRA) and the US Chips Act. “There are improvements we can make that can basically make it easier for European countries to participate or stand on their own,” Biden said. He and Macron had discussed the issue at length, he said.

    The IRA, a roughly $400 billion US climate program, was Macron’s main concern along with the Ukraine war. In the other EU states, too, close attention was paid to whether the French president could achieve changes in implementation in Washington. Following him, the EU Commission delegation led by Margrethe Vestager and Valdis Dombrovskis will now travel to the United States, meeting their US counterparts at the Trade and Technology Council (TTC) on Monday (the draft final declaration can be found here).

    Limited financial scope

    After the TTC, the EU states then want to make an initial assessment. The issue is likely to occupy the heads of state and government at the EU summit on Dec. 15. This is because there is great concern that many industrial companies prefer to invest abroad in view of the high energy prices in Europe and the enticing calls from Washington (and Beijing).

    Top politicians such as Macron and Vestager are currently holding talks with CEOs in an attempt to dissuade the companies. But appeals will hardly suffice. Governments at national and European level must now decide in the short term how to respond. The financial leeway is limited – the EU states have already earmarked €600 billion for aid in the energy crisis alone.

    The following options are being discussed:

    Trade conflict: willpower is missing

    The EU could take action against the passages in the IRA that link subsidies to production in North America – which is clearly not compatible with World Trade Organization rules. But hardly anyone wants that in the current political world situation, with the possible exception of France.

    An EU versus US case at the WTO would generate headlines around the world, but would be unlikely to produce timely results given the paralysis of the Geneva dispute settlement mechanism. At last week’s Trade Council, many ministers stressed that the dispute over the IRA should not undermine transatlantic relations. EU tools such as the Foreign Subsidies Instrument are also inappropriate here, according to Brussels.

    Foreclosure: conflict with commercial law

    The EU could follow Washington’s lead and erect its own hurdles for foreign companies. Macron has been drumming up support for a “Buy European” act for weeks. In Germany, Minister for Economic Affairs and Climate Action Robert Habeck shows some sympathy for it.

    He brought up the idea of taking criteria such as the carbon footprint into account when promoting the production of solar panels or wind turbines – which would favor “more regional production”. However, the EU could hardly afford to blatantly ignore WTO rules in the process. “We should not copy what we don’t like in others,” warns a senior EU diplomat.

    Industrial policy: subsidies and less bureaucracy

    Germany and France are pulling in the same direction here: “We need a second phase of the Green Deal: from regulation to a green industrial policy,” said State Secretary for Economic Affairs Sven Giegold yesterday at the Competitiveness Council in Brussels.

    The issue offers a welcome opportunity after the recent dissonances to get the Franco-German engine running again. Even traditionally skeptical states like the Netherlands could get involved, according to diplomats – provided Paris and Berlin coordinate closely with their partners.

    The industrial policy approach would hit two birds with one stone: new subsidies for climate-friendly technologies and less bureaucracy.

    • On Wednesday evening, Internal Market Commissioner Thierry Breton launched the new Clean Tech Europe industry platform. As a first step, the Commission, member states and industry agreed to set up a political steering body and working groups to quickly present concrete options for action.
    • The Commission and the German government are also in favor of launching further IPCEI projects. These could be linked to ongoing projects that are already promoting projects in climate-friendly technologies such as batteries or hydrogen. The IPCEI framework allows member states to provide generous subsidies to industry, but the requirements, such as the innovative nature of the projects, are quite high. It sometimes takes two years for projects to be coordinated across borders and approved by the Commission.
    • Habeck wants to speed up the IPCEI procedure and make it easier for companies to get started even before final approval. However, the Federal Ministry for Economic Affairs and Climate Action (BMWK) itself is also called upon to do this, according to industry circles: At present, the ministry is delaying many projects because it is not giving the go-ahead for the early start of measures.
    • Politically more explosive is Habeck’s call to also facilitate subsidies in the mass production of climate-friendly technologies. Currently, this is only possible under state aid law on a case-by-case basis or in a separate legal framework such as the Chips Act. Giegold warns, “If our own rules ensure that there is no more production here, then we have thrown the baby out with the bathwater.” However, state aid experts warn against now puncturing the uniform legal framework with special rules for more and more sectors. Competition Commissioner Vestager also opposes such proposals.

    Funding: new ways and old pots

    Berlin and Paris are therefore looking for ways to avoid the problems with state aid law and win over the Commission to their cause. One way: to at least partially Europeanize industrial aid. “Otherwise, we would have unfair competition within Europe between those who can pay and those who can’t,” says Giegold. First, however, the skeptics have to be convinced – in Berlin’s coalition, that’s the FDP.

    • For example, the new REPowerEU pot, which is to contain €20 billion in fresh funds, could be tapped for this purpose. This is intended to reduce Europe’s dependence on fossil fuels from Russia – for example, by promoting solar systems or heat pumps. This could possibly also stimulate investments in these areas, according to Brussels.
    • Further funds for REPowerEU could possibly be mobilized from the Corona reconstruction program Next Generation EU: There, €220 billion are still available for loans that member states have not yet drawn upon. As soon as the REPowerEU regulation comes into force, the member states have 30 days to apply for the loans. What is not called upon could be reallocated, according to the ideas from Brussels.
    • In response to the IRA, another pot could also be tapped: the Innovation Fund. This is fed by the revenue from emissions trading and is intended to promote innovative climate-friendly technologies to the tune of around €38 billion by 2030. The upside of this is that the money from the fund is not considered state aid – and could therefore offer a way out of the political dispute.

    What the industry says

    In terms of financial volume, the IRA and REPowerEU are quite comparable. While the EU Commission is making around €300 billion available, the US government is providing almost $400 billion for a wide range of areas. According to an overview by McKinsey, $250 billion of this will go to the energy sector. Many in the business community see the crucial difference more in the simpler procedures for accessing the funds.

    The US logic: Depending on how much a company reduces CO2 emissions, it can reduce its taxes in stages, explains Torsten Oltmanns of the Center for Sustainable Transformation. This is the case with the hydrogen megatrend, for example: As long as the production of one kilogram of hydrogen does not cause more than four kilograms of CO2, tax breaks apply.

    The full rebate is available if the CO2 intensity is below 450 grams per kilo of the energy carrier. For the association Hydrogen Europe, the IRA has clear advantages: “This law offers a much clearer, easier to understand funding instrument,” CEO Jorgo Chatzimarkakis said recently in an interview with Europe.Table.

    The wind power industry is calling for faster approval procedures in particular – projects with 80 gigawatts are currently waiting for approval in Europe, criticizes the Wind Europe association. In addition, the criteria for the tenders should be changed: Not only the price should decide, but also sustainability criteria. with Manuel Berkel

    • Climate & Environment
    • Climate protection
    • Financial policy
    • Industriepolitik
    • REPowerEU

    Michel is not being heard in Beijing

    EU Council President Charles Michel has called on Beijing, during his visit to China, to press Moscow to end the war in Ukraine. “We are counting on China to use its influence,” Michel said after talks with state and party leader Xi Jinping.

    He said Xi had clearly assured him that the People’s Republic would not supply weapons to Russia and rejected nuclear threats. “President Xi and I agreed that nuclear threats are unacceptable and highly dangerous.”

    The country has a special responsibility as a UN veto power to ensure that the UN Charter is respected, the EU Council president added. The Belgian said he hoped China would use all means in the coming weeks and months to “convince” Russia to end the war and respect Ukraine’s sovereignty. There was no joint press statement after the meeting; both sides issued their own statements.

    ‘Dialogue of the deaf’

    Since the beginning of the Russian invasion of Ukraine, the EU has been appealing to the Chinese leadership to put pressure on Russia’s President Vladimir Putin. So far, however, with very limited success. Belief in Beijing’s influence had declined massively, especially after the unsuccessful EU-China dialogue in early April.

    The EU’s foreign affairs representative Josep Borrell had subsequently dubbed the video summit a “dialogue of the deaf”. A recorded video message by Michel himself, intended for the opening of the export fair in Shanghai, was not shown on purpose. In it, the EU Council leader had called on Russia to stop the bloodshed in Ukraine.

    China to support EU in ‘mediation’

    The message from the Chinese side after the meeting also stated that Ukraine was discussed. However, the word “war” was still not used, only a “crisis” was mentioned. During the talks, Xi Jinping insisted on a political solution through negotiations, state broadcaster CCTV reported.

    Xi was quoted as saying that “resolving the Ukraine crisis by political means is in the best interests of Europe and in the common interests of all countries in Eurasia.” Under the current conditions, escalation and expansion of the crisis must be avoided, Xi said, according to state media.

    The devil is in the details: China “supported the EU in strengthening its mediation,” the Chinese statement stated. The People’s Republic also cited an “establishment of a balanced, effective and sustainable European security architecture.” This wording can already be found in a similar way in the joint statement issued by Russia and China at the beginning of February this year, criticizing a possible NATO expansion in Europe.

    ‘Constructive role’ of China

    Another choice of words in the Chinese statement is noteworthy, Justyna Szczudlik, a China analyst at the Polish Institute of International Affairs (PISM) in Warsaw, writes on Twitter: it says China is always on the side of peace and will “continue to play a constructive role in its own way,” as Szczudlik writes. She summarizes, “Let me be clear: this is like ‘constructive role with Chinese characteristics’ = endorsing Russia.” Beijing’s timely response to the EU appeal remains unlikely, even after the meeting.

    Communication after the meeting also varied on other topics, with the EU Council President assuring that he had addressed the recent protests in China. “In a broader sense, there was an exchange about Covid and the experiences in Europe and China, including the respective measures taken and the response of the societies,” a spokesperson for Michel said after the three-hour meeting. However, the Chinese statement did not mention this point. Members of the EU Parliament, in particular, had called for a clear signal from the EU Council President to the Chinese leadership before Michel’s trip.

    Equality and fairness in business

    Beijing, meanwhile, sought to emphasize the common ground between the two economic blocs. In doing so, Xi sought to show positivity and improve relations with Brussels amid Beijing’s growing rivalry with Washington. Brussels and Beijing have no “real strategic differences or conflicts,” Xi said. He hoped they could join forces to jointly “resist decoupling,” Xi was quoted as saying by Chinese state media.

    At the same time, Michel insisted on more equality and fairness in economic relations with China. There must be equal access for European companies in China and for Chinese companies in the EU’s internal market. The background is complaints from European companies about restrictions in China. “We do not want excessive dependence,” Michel stressed. He also stressed that European companies would be willing to supply vaccines to China if they were approved there.

    Xi: working on advancing the CAI

    Accordingly, Xi also came to talk about a permanent construction site: Both sides were working on advancing the CAI investment agreement. This part of the conversation did not make it into the EU’s statement. Michel did, however, have the opportunity to raise the issue of human rights in general. The EU Council President had stressed the universality of fundamental freedoms and “reaffirmed the EU’s commitment to its ‘One-China Policy’ and recalled the EU’s long-standing position on the Taiwan Strait.”

    The first meeting was rich in topics, even if a clear focus was missing. For the resumption of personal talks, however, Michel’s visit was a start. The consensus on trade issues emphasized above all by Xi – and subsequently also by the state media – was certainly also intended to send a signal in the direction of Washington. EU and US representatives met there on Thursday for a dialogue on China and the Indo-Pacific.

    • Charles Michel
    • China
    • European policy
    • Xi Jinping

    EU-Monitoring

    Dec. 5-6, 2022
    Council of the EU: Transport, Telecommunications and Energy
    Topics: General approach on the revision of the regulation on Union guidelines for the development of the trans-European transport network, Approval of the conclusions on the ongoing development of inland waterway transport, Information from the Presidency and the Commission on the transport relations with Ukraine. Draft Agenda

    Dec. 5, 2022; 3-6:30 p.m.
    Meeting of the Committee on Budgetary Control (CONT)
    Topics: Draft report on the protection of the EU’s financial interests, Draft report on the Control of the financial activities of the European Investment Bank, Public Hearing on Instruments and tools at EU level and developed at Member States’ level to prevent and tackle fraud and financial and economic crimes. Draft Agenda

    Dec. 5, 2022; 3-6:30 p.m.
    Meeting of the Committee on Industry, Research and Energy (ITRE)
    Topics: Draft opinion on laying down harmonised conditions for the marketing of construction products, Exchange of views with Cristina Lobillo Borrero (Director of the Energy Platform Task Force) on the state of play of the Energy Charter Treaty and the way forward. Draft Agenda

    Dec. 5, 2022; 3-6:30 p.m.
    Meeting of the Committee on Civil Liberties, Justice and Home Affairs (LIBE)
    Topics: Draft opinion on the proposals of the European Parliament for the amendment of the treaties, Exchange of views on the Interpol’s role in the EU’s Security Architecture, State of play of negotiations on Readmission Agreements and arrangements. Draft Agenda

    Dec. 5, 2022; 3-6:30 p.m.
    Meeting of the Committee on Security and Defense (SEDE)
    Topics: Exchange of views on the EU military operation EUFOR Althea and the security situation in Bosnia and Herzegovina, EU’s support in providing lethal military equipment for Ukraine, Exchange of views on the situation in Ukraine Draft Agenda

    Dec. 5, 2022; 3-6:30 p.m.
    Meeting of the Committee on Human Rights (DROI)
    Topics: Exchange of views on the recent demonstrations in China, Exchange of views with Christophe Deloire (Secretary General of Reporters Without Borders), Public hearing on the African Union and its human rights and democracy mechanisms. Draft Agenda

    Dec. 5, 2022; 3-6:30 p.m.
    Meeting of the Committe on Constitutional Affairs (AFCO)
    Topics: Draft opinion on the information security in the institutions, bodies, offices and agencies of the Union. Draft Agenda

    Dec. 5, 2022; 3-6:30 p.m.
    Meeting of the Committee on the Environment, Public Health and Food Safety (ENVI)
    Topics: Exchange of views with the Commission on the upcoming IMO MEPC 79 session, Exchange of views with the citizens’ spokesperson for public health matters in the Conference on the Future of Europe, Exchange of views with the Commission and United Nations Environment Programme (UNEP) on the state of play of negotiations of a Global Treaty on Plastic Pollution. Draft Agenda

    Dec. 5, 2022; 3-4:30 p.m.
    Joint Meeting of the Committee on the Economic and Monetary Affairs (ECON) and of the Committee on the Environment, Public Health and Food Safety (ENVI)
    Topics: Exchange of views with Mairead McGuinness (Commissioner for financial services, financial stability and Capital Markets Union) on the state of play in the developments of the remaining technical screening criteria and on the work of the Platform on Sustainable Finance. Draft Agenda

    Dec. 5, 2022; 4:30 p.m.
    Euro Group
    Topics: Assessment of euro area Member States’ Draft Budgetary Plans and of the budgetary situation and prospects of the euro area, Euro area recommendations for 2023 (presentation by the Commission), Commission Communication on orientations for a reform of the EU economic governance framework. Draft Agenda

    Dec. 6, 2022; 10 a.m.
    Council of the EU: Economic and Financial Affairs
    Topics: Council Implementing Decision on measures for the protection of the Union budget against breaches of the principles of the rule of law in Hungary, State of play of the implementation of the Recovery and Resilience Facility, Policy debate on the revision of the energy taxation Directive. Draft Agenda

    Dec. 6, 2022; 10:15 a.m.-2:30 p.m.
    EU-Western Balkans Summit
    Topics: Cooperation in the face of common challenges stemming from Russia’s aggression against Ukraine, Ways of deepening political and policy engagement (with a particular focus on young people), Coordinated actions on security and defence issues. Infos

    Dec. 7, 2022
    Weekly Commission Meeting
    Topics: VAT in the Digital Age, Administrative cooperation in taxation (DAC 8), Strengthening capital markets package, Equality package. Draft Agenda

    Dec. 8-9, 2022
    Council of the EU: Justice and Home Affairs
    Topics: Adoption of the Council Decision on the full application of the provisions of the Schengen acquis in Bulgaria and Romania, Partial general approach on the regulation on addressing situations of instrumentalisation in the field of migration and asylum, Exchange of views on Russia’s aggression against Ukraine. Draft Agenda

    Dec. 8-9, 2022
    Council of the EU: Employment, Social Policy, Health and Consumer Affairs
    Topics: General approach on the directive on improving working conditions in platform work, Policy debate on the European Care Strategy, Information from the Commission on the European Union Global Health strategy. Draft Agenda

    Dec. 8, 2022
    ECJ ruling on the right to be forgotten
    Topics: Several articles appeared on the website of a US company in 2015 that were critical of the investment model of various financial services companies. For its part, the business model of the company operating the website was reported critically, among other things with the accusation that it was trying to blackmail other companies by first publishing negative reports and then offering to delete the reports or prevent the negative reporting in exchange for a so-called protection money. Against this backdrop, the Federal Court of Justice asked the ECJ to interpret the General Data Protection Regulation and the EU Charter of Fundamental Rights. Request

    Dec. 8, 2022; 9 a.m.-12:30 p.m.
    Meeting of the Committee on Agriculture and Rural Development (AGRI)
    Topics: The Committee on Agriculture and Rural Development (AGRI) meets for consultations. Draft Agenda

    Dec. 8, 2022; 2-5:30 p.m.
    Meeting of the Committee on Internal Market and Consumer Protection (IMCO)
    Topics: Draft opinion on harmonized rules on fair access to and use of data (Data Act), Draft opinion on Corporate Sustainability Due Diligence, Draft opinion on the EU Strategy for sustainable and circular textiles. Draft Agenda

    Dec. 11-12, 2022
    Council of the EU: Agriculture and Fisheries
    Topics: State of play of the regulation on the sustainable use of plant protection products, Exchange of views on the evaluation of the EU animal welfare legislation, Exchange of views on the market situation in particular following the invasion of Ukraine. Draft Agenda

    News

    Hydrogen: shorter transition period in Delegated Act

    For the production of hydrogen, the Commission wants to shorten the transition period in which facilitated conditions apply. The deadline is now March 31, 2028, according to a new version of the Delegated Act dated Wednesday and obtained by Europe.Table. In a July leak, the transition period was still valid until the end of 2029.

    In return, however, the Commission wants to further simplify the conditions for so-called temporal additionality in the transition phase. Several criteria for additionality are intended to ensure that liquid or gaseous renewable fuels of non-biogenic origin (RFNBOs) are produced with additional renewable electricity and do not, for example, boost the electricity production of fossil power plants.

    Quarter instead of month for temporal correlation

    The requirements relate to the constellation in which the electrolyzer for hydrogen production obtains its electricity from the public grid and the operator has concluded a long-term supply contract (PPA) with a green power producer. After the transition period, the temporal connection between electricity generation and electrolysis must be proven on an hourly basis.

    In the transition period, facilitated conditions apply. According to the July leak, the temporal context was to be extended to the calendar month. According to the new draft, even a calendar quarter is now to suffice for the evidence.

    Greens criticize certificate tricks with coal-fired power

    The Commission writes in the recitals that this is intended to take account of technological hurdles in measurement, the design of electrolyzers and the necessary infrastructure for storing and transporting hydrogen. For the Greens, however, the shortened deadline still goes too far.

    “It is good that the Commission is demanding that green hydrogen be produced with additional renewable energies and not simply with electricity from the grid. This will accelerate the expansion of solar and wind power and bring us a step closer to Europe’s energy independence and climate neutrality,” says MEP Michael Bloss. “However, the transition period envisaged by the Commission is far too long. Until 2028, certificate tricks and the production of green hydrogen with nuclear, coal and gas power will be allowed.” ber

    • E-Fuels
    • Energy
    • Energy policy
    • Hydrogen
    • Renewable energies

    IEA Director Fatih Birol warns Germany against fracking

    The head of the International Energy Agency (IEA), Fatih Birol, warns Germany against entering fracking. “If Germany starts fracking today, it will take forever for the first gas from it to reach the market. I would be very cautious about that,” he told Table Media. “The risk of not being able to take advantage of this investment is huge.

    Fracking, the extraction of natural gas under high pressure from artificially created cracks in bedrock, is prohibited by law in Germany. In view of the energy crisis, Finance Minister Christian Lindner (FDP) has called for an end to the ban. Minister for Economic Affairs and Climate Action Robert Habeck (Greens) and Chancellor Olaf Scholz (SPD) are opposed.

    With regard to possible gas supply contracts between Germany and Senegal, Birol urged caution. “The contract periods must be chosen wisely. It must be possible to use the gas infrastructure later for ammonia or hydrogen,” he said. “And the energy needed to liquefy the gas should come from renewable sources.” ae

    • Climate Policy
    • Energy
    • Energy policy
    • Germany

    Eurogroup: Greece to receive debt relief

    The finance ministers of the 19 euro countries want to give the green light for a final package of measures to relieve Greece’s debt at the next meeting of the Eurogroup on Dec. 5. According to a high-ranking EU official, this underlines the appreciation and respect of the euro partners regarding the reforms carried out by Greece in recent years.

    The country has been released from enhanced macroeconomic surveillance following the financial crisis in August 2022 but still had some final measures to implement. On Nov. 22, the European Commission presented its first report on the situation in Greece following the enhanced surveillance.

    In the report, the EU authority stresses that the government in Athens has now implemented the reforms it agreed on with the European institutions. It also says the country is able to service its debt on outstanding bonds issued by the euro bailout fund (EFSF, ESM) and other bilateral lenders.

    In view of the decision of the euro finance ministers, the Commission’s report suggests that Greece be given a final transfer in the amount of €644 million. This is related to the Greek bonds held by the national central banks of the monetary union, which the central banks acquired under the Securities Markets Program between 2010 and 2012.

    In addition, Greece is to be waived an interest premium of €123 million on various EFSF bonds for the second half of 2022. Furthermore, the interest rate premium, which can be up to 200 basis points, is to be persistently set at zero from 2023 to 2049. This corresponds to potential payment relief for Athens of around €5.2 billion over the period mentioned. cr

    • European policy
    • Finance
    • Greece

    EU decides on $60 price cap for Russian oil

    According to diplomats, the EU states have agreed on a price cap of $60 per barrel for Russian oil transported by sea. With an adjustment mechanism, the cap should also always be kept at five percent below the market price, an EU diplomat told the Reuters news agency.

    Poland, which has insisted on the lowest possible price cap, must still approve the agreement on Thursday. If it does, the deal could be signed by all EU governments by Friday. The deal takes up a plan by the seven largest industrialized nations (G7) and would replace an EU decision that Russian oil may not be landed in Europe at all, starting Monday.

    The aim is to reduce Russia’s revenues on the one hand. For this reason, Poland and the Baltic states in particular are campaigning for a low price. On the other hand, the global oil price should not be driven up by a complete import freeze, as Russia produces around ten percent of the world’s oil.

    Russia’s reaction unclear

    An important lever for implementing the price limit is to be that insurance companies and shipping companies may only participate in Russian business if the oil is sold below $60 per barrel. Although the world market price is currently below this level anyway, it could rise again when the global economy picks up.

    It is unclear how Russia will react. The Kremlin indicated that states participating in a price cap would no longer be supplied at all.

    Pipeline oil that flows to Europe is exempt from the EU sanctions. Hungary, among others, insisted on this. Germany, however, has declared that it will stop buying Russian oil via this route from 2023. The German government is therefore looking for another way to secure supplies to the Schwedt refinery in eastern Germany. rtr

    • Energy
    • Energy policy
    • Energy Prices

    Due diligence: Council decides on special role for financial sector

    France was able to assert itself. The Council compromise on the Due Diligence Act will not automatically be applied to the financial sector. It is up to each member state to decide whether financial services are covered by the law or not. The definition of the financial industries to be regulated has also been significantly limited, with investment funds, for example, being almost completely excluded.

    With this proposal, the Czech Council Presidency managed to resolve the dispute within the member states over the scope of the law. France threatened with a blocking minority until the last minute if financial services had to perform due diligence.

    Germany supports compromise

    The compromise received a qualified majority in yesterday’s Competitiveness Council: the Council’s General Approach is thus in place. Germany supported the compromise yesterday. The Council’s proposal significantly weakens the Commission’s proposal in some points. For example, in the first year only very large companies with more than 1,000 employees and €300 million in annual sales are to be covered by the law. Arms exports and dual-use goods are excluded from the law.

    Deputies and NGOs disappointed

    However, the compromise text has also been met with criticism. Green Party politician Anna Cavazzini calls the special regulation for the financial center “scandalous and incomprehensible”. The EU should no longer tolerate investments in human rights violations, she said. The European SPD is more pragmatic: “Given the difficult starting position and tough opposition from some member states, this is probably the best possible outcome,” says Tiemo Wölken.

    Among other things, environmental and human rights organizations are bothered by the fact that not all downstream activities, such as the use of products, are covered: “This would mean that agricultural companies, for example, would be in the clear, even if their pesticides damage the health of farmers and plantation workers,” writes the Supply Chain Act initiative.

    Craftsmen’s association criticizes obligation to provide proof

    For some stakeholders, however, the compromise goes too far: “De facto, every company in Europe will be affected by the massive bureaucratic requirements of the Supply Chain Act, as the obligations are simply passed down the chain,” criticizes Axel Voss (EPP), for example. The CDU politician is shadow rapporteur for the proposal in Parliament.

    The German Confederation of Skilled Crafts (Zentralverband des Deutschen Handwerks, ZDH) agrees and calls for European supply chains to be exempted from the obligation to provide evidence of compliance with human rights and environmental standards, as this would threaten micro and small enterprises with “a considerable, hardly presentable and unreasonable administrative burden”.

    In contrast to the Council, there is still no compromise text in Parliament. At the beginning of November, rapporteur Lara Wolters presented her proposal, which is significantly stricter than the Commission’s proposal.

    • European policy
    • Finance
    • Financial policy
    • Supply chains

    EU environment committee wants export ban on plastic waste

    The EU Parliament’s Committee on the Environment, Public Health and Food Safety (ENVI) on Thursday adopted its position on the so-called Waste Shipment Regulation. The members were in favor of completely phasing out the export of plastic waste to OECD countries within four years of the law coming into force.

    Exports of so-called “non-hazardous waste” – that is, waste that does not harm human health or the environment – may only be exported to non-OECD countries with their consent. In addition, the recipient countries must prove that they are able to dispose of or recycle this waste sustainably.

    Council orientation still pending

    The Commission must draw up and publish the list of recipient countries annually. MEPs also call for the creation of a risk-based guide in the verification of waste exports to prevent and detect illegal waste shipments.

    The regulation is part of the EU Commission’s circular economy package, which the authority presented at the end of last year. ENVI’s position must now be confirmed in the plenum of the EU Parliament. The general orientation of the Council is still pending and is expected under the Swedish Council Presidency at the earliest. luk

    • Climate & Environment
    • Climate protection

    Vandenberghe to become new director of DG CLIMA

    Belgian Kurt Vandenberghe, currently advisor to European Commission President Ursula von der Leyen on the Green Deal, Energy and Transport, will be the new head of the Directorate-General CLIMA.

    Vandenberghe joined the Commission in 1996 and worked in DG MOVE (Mobility and Transport). He then worked in the cabinet of Belgian Research Commissioner Philippe Busquin (1999 to 2004) and headed the cabinet of his successor Janez Potočnik (2004 to 2009), whom he succeeded in the Environment portfolio under the presidency of Jean-Claude Juncker.

    Prior to joining the Commission, Kurt Vandenberghe worked for four years as a manager at Ernst & Young Association Management, where he built, managed and represented international trade associations.

    He will take office on Jan. 16, 2023, assuming the post that has been vacant since the death of former Director General Mauro Petriccione on Aug. 22. cst

    • EU
    • European Commission

    Column

    Social redistribution of Mafia property: France takes after Italy

    By Claire Stam
    Schwarz-weiß Portrait von Claire Stam

    There is hardly anything ordinary about the La Poesia restaurant, which opened in Paris on Nov. 2, mainly because meals are prepared with products supplied by the Italian organization Libera Terra. The organization manages agricultural land that has been seized from the Mafia.

    Even the cuvées are not ordinary: Each bottle honors on the label one of the many victims of the Mafia. In Paris, the fight against the Mafia thus harmonizes from now on with Italian culinary art. This is the task that the restaurant La Poesia, located at 3, Rue de la Fidélité in the 10th arrondissement of Paris, has set itself.

    Restaurant staff for social reintegration

    The restaurant, born of a family history between France and Italy, entered into a partnership unprecedented in France with the Italian organization Libera Terra. Libera Terra not only manages agricultural land seized by the judiciary and formerly owned by the Mafia. The organization also unites the work of agricultural cooperatives located on this land and selects them based on their compliance with social and environmental rules.

    La Poesia, however, wants to go one step further: The restaurant is currently forging partnerships with French associations that work for social reintegration. The restaurant plans to recruit staff from the people who are under the protection of these associations. This approach mirrors Italian practices of reinvesting money and goods seized from organized crime in social institutions.

    Trademark of Italian justice

    The initiative of the restaurant La Poesia raises a question: What to do with goods that have belonged to criminals when the judiciary orders their confiscation? Strategies vary from country to country. France resells them at auctions and recovers the money for the treasury. Italy, where so-called preventive seizures have been in place since 1982 to combat the Mafia, passed a more innovative law in 1996 that allows assets seized from organized crime to be bequeathed to social causes.

    This provision, recognized by the European Court of Human Rights in 2014, has become the hallmark of Italian justice. The country thus lists 40,000 seized properties, almost half of which have been redistributed. Thus, prestigious villas with swimming pools are transformed into vacation centers for disadvantaged children, tomato fields or olive trees are stamped “anti-Mafia” for production, or buildings are converted into administrative offices.

    Idea finds imitators

    The practice is still marginal in France despite the passage of an Italian-style law in 2021, but the Italian idea of social redistribution of goods taken from mobsters is gradually finding its way there. Former Justice Minister Nicole Belloubet was enthusiastic about the idea.

    And in February 2020, Macron and then Italian Prime Minister Giuseppe Conte met in Naples for bilateral talks and publicly confirmed the project, even before the practical modalities were defined. Currently, the French administration has a long list of apartments, buildings and villas scattered throughout the country, confiscated from Mafiosi.

    And as for La Poesia, it is not only a restaurant but also a place of culture. On Dec. 10, two well-known personalities of Italian justice, Antonio Balsamo, President of the Court of Palermo, and Francesco Menditto, Prosecutor of Tivoli, will be present. They will hold a meeting in their honor 30 years after the murder of their colleagues Giovanni Falcone and Paolo Borsellino.

    • France
    • Italy
    • Society

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