The EU Commission will today publish the regulation in which it will set out the import duties for the individual EV manufacturers. According to Brussels, there will be no surprises, i.e. the tariff rates will largely correspond to what the Commission announced to manufacturers on June 12.
This is a predictable disappointmentfor theGerman government. In the name of open markets, it had campaigned for a negotiated solution. Its main aim was to reduce trade risks for German industry.
Minister for Economic Affairs Robert Habeck reacted with great satisfaction in Beijing when China began negotiations with Brussels on the tariffs during his visit. This at least opened the door to an amicable solution. However, the talks between Beijing and Brussels have so far produced little movement. Far from considering its subsidies unfair, Beijing sees them as legitimate support for an emerging industry – and conversely points to high subsidies in the EU for several sectors.
Instead, the Chinese side is falling back into its usual pattern of dividing the EU instead of arguingon the merits. This is because the member states will not decide on the final amount of the levies until November. Companies that import EVs from China will therefore not have to pay them until November. Until then, the payments will be paid into escrow accounts.
Your Till Hoppe
Feature
How the industry is fighting for lower energy prices
According to a new study commissioned by the industry association Business Europe, electricity prices in the EU will remain significantly higher than in other major economies even if the energy transition is successful. A rapid expansion of low-carbon energy at the most favorable locations could make electricity in the EU 40% cheaper.
“However, our new study shows that energy prices in Europewill be at least 50 percent higher than in the USA, China and India by 2050, even if the EU pushes ahead with its energy policy”, says Markus J. Beyrer, Director General of Business Europe. The study expects the lowest electricity generation costs for India.
Extend carbon leakage regulation to include energy costs
The paper published today was available to Table.Briefings in advance. It can be read as an attempt to give the debate on a state-subsidized industrial electricity price a new spin. Business Europe builds on the generally recognized carbon leakage definition from emissions trading and wants to expand the term from CO2 to energy system costs.
On the one hand, the association is calling for changes to the CBAM border adjustment mechanism and longer compensation for CO2 costs – particularly for steel and fertilizer production. However, according to the association, the sectors affected by relocation due to high energy prices could be different from those threatened with relocation due to high CO2 costs.
Relief due to infrastructure expansion
The EU must therefore pursue a broader concept of carbon leakage and also include cost burdens for energy and infrastructure, Business Europe demands. In response, the association prefers higher EU funding with the hydrogen bank auctions as a model. Further measures should be left to the member states – for example, a reduction in grid charges for electricity cost-intensive companies, as has long been the case in Germany.
“This will become increasingly important in the coming years as investment in energy infrastructures increases”, writes Business Europe. The Chancellery has also identified rising grid fees as one of the most important economic policy issues for the coming years. In a recent interview with Table.Briefings, Tennet COO Tim Meyerjürgens said that Germany alone is facing investments in the grids amounting to €500 billion. However, reductions for certain companies are paid for by non-beneficiary businesses and household customers.
Internal electricity market and electrification lower energy prices
The study also shows the costs of a faltering energy transition. In a slower scenario, electricity prices stabilize at €110 per megawatt hour in the long term, andat €65/MWh on the more ambitious path. The prerequisites are:
More transmission capacities between the member states and a common internal electricity market – contrary to current threats from Jordan Bardella of the Rassemblement National;
Increasing the electrification rate from 21% today to 56% and a reduced role for hydrogen;
Strong expansion of renewable energies, especially in favorable locations on the Iberian Peninsula and in Scandinavia;
A multiplication of flexibilities to compensate for lulls in renewables. For the most cost-effective option, the capacities of batteriesshould increase five times as much as those of gas or hydrogen power plants;
Similarly high capacities of nuclear power plants (99 GW) as today, which stabilize electricity prices, but require immense subsidies due to an outdated power plant fleet.
For cost reasons, Business Europe is advocating greater use of low-carbon – i.e. essentially blue – hydrogen. According to PIK, the energy carrier obtained from natural gas with Carbon Capture and Storage (CCS) could still be cheaper beyond 2040 than green hydrogen produced by electrolysis with green electricity.
More blue hydrogen and amendment of environmental planning law
The association therefore wants a “targeted evaluation” of the industry quota for green hydrogen in the Renewable Energy Directive (RED). The experts recommend an amendment to the RED so that not only RFNBO but also low-carbon hydrogen is recognized as a fulfillment option in the quota.
In its recommendations, however, Business Europe tends to oppose “inflating the denominator”, which currently includes all forms of hydrogen, including low-carbon hydrogen. The second-best option from an industry perspective would therefore appear to be not to include blue H2 in the numerator, but to exclude it from the denominator. Both would reduce the absolute amount of green hydrogen needed in the industry.
Nature conservation associations are also unlikely to be pleased: Despite the recent acceleration of approval procedures, Business Europe is calling for further interventions in environmental planning law in order to simplify the conversion of industrial plants for decarbonization. The association wants a corresponding amendment to the Strategic Environmental Assessment (SEA) Directive and a time limit for Environmental Impact Assessments (EIA).
Grüner Wasserstoff
Translation missing.
Events
July 5-6, 2024; Tutzing (Germany) D21, SeminarDemocracy in the digital age: the 2024 super election year The D21 initiative explores the question of how digitalization is shaping the future of elections and thus our democracy.INFO & REGISTRATION
July 8, 2024; 9 a.m.-6 p.m., Fiesole (Italy) EUI, Conference3rd Florence Rail Regulation Conference The Florence School of Regulation (FSR) evaluates existing policies and analyzes new proposals to accelerate the growth of the Railways Industry.INFO & REGISTRATION
Translation missing.
News
No new faction around the BSW
The formation of a new parliamentary group in the European Parliament around the Sahra Wagenknecht alliance (BSW) has failed. This was admitted by BSW lead candidate Fabio De Masi on Wednesday. They had come very close to forming a new parliamentary group in the meantime but had not found enough supporters. Now they want to work closely with other critics of the Commission under Ursula von der Leyen, even without a parliamentary group. “Von der Leyen will not receive a vote from us”, said De Masi. Without a parliamentary group, the six BSW MEPs will not be able to lay claim to committee chairmanships.
The BSW had been working with the Italian Five Star Movement to form a new parliamentary group. However, the movement is now negotiating with the leadership of the Left parliamentary group about joining. A meeting is planned for today, Thursday, and the decision should be made by the evening. The Five Star Movement has eight MEPs in the European Parliament.
Martin Schirdewan remains co-leader of the left-wing parliamentary group
The parliamentary group of the Left Party is once again likely to be led by two co-chairs: The current co-chair Manon Aubry from France is to hold the office for the entire parliamentary term, as decided by the extended parliamentary group executive committee. Her current co-chair Martin Schirdewan is to hold office for the first half of the parliamentary term and hand over to Kostas Arvanitis from Syriza in Greece after two and a half years. The Left Group has 39 members. The delegation of three German MEPs is led by Özlem Alev Demirel.
The parliamentary groups are to be formed by this Thursday. However, this is not a hard deadline: changes are basically still possible until the constituent meeting on July 16. To form a political group in the European Parliament, 23 MEPs from seven countries are required.
Right-wingers still sorting themselves out
No further major changes are foreseeable in the centrist groups. The liberal Renew Group will accept two more MEPs from Ireland, and there are also talks with an MEP from Cyprus. Individual non-attached MEPs may also join the Greens. However, it was unclear until Wednesday evening whether this would happen.
The conservative ECR Group was constituted on Wednesday. Nicola Procaccini from the Fratelli D’Italia and Joachim Brudziński from the Polish PiS are co-leaders of the group. With 24 MEPs, the Fratelli make up the largest delegation in the group. The PiS forms the second-strongest delegation with 20 MEPs. It is now clear that the PiS will remain in the group. There had previously been speculation as to whether the PiS would form a group together with the Hungarian Fidesz. The EKR parliamentary group now has 84 members, making it the third-largest group. Jaak Madison from Estonia recently joined the EKR.
Orbán negotiates with Le Pen
There is still the most movement in the national conservative and far-right camps. Hungary’s Prime Minister Viktor Orbán wants to form a new parliamentary group, the “Patriots for Europe“, which is likely to be joined by the FPÖ and the Ano of Czech billionaire Andrej Babiš. It is foreseeable that the Portuguese Chega MEPs and parliamentarians from Matteo Salvini’s Lega will join.
There are also intense talks between Orbán and the leadership of the Rassemblement National, Marine Le Pen and Jordan Bardella. However, it will probably not be clear whether they will work together until after the second round of the French parliamentary elections on Sunday. The ID parliamentary group, of which the RN has been a member to date, has postponed its constituent meeting until next week.
However, the AfD will definitely not be part of the new parliamentary group, as party leader Alice Weidel confirmed on Tuesday. Orbán considers the German right-wing party too radical and fears additional conflicts with the German government. mgr, tho, luk, sas
S&D: These are the demands for the next five years
The Social Democrats in the European Parliament are contemplating a proposal for an EU-wide harmonized tax on corporate stock buybacks. This issue is highlighted in an eleven-page draft of the core demands of the S&D group for the next legislative term, obtained by Table.Briefings on Wednesday. While the Social Democrats have not yet reached a final agreement in their group meeting, the delegation leaders are expected to reach a consensus soon.
The draft also calls for effective minimum taxation of capital gains at the EU level, a framework for systematic taxation of windfall profits, and a broad-based financial transaction tax. This tax should be set high enough to deter speculation and generate substantial revenue.
Action program for social progress and quality employment
The first section of the document is dedicated to an action program for social progress and quality employment. This program includes a range of measures, such as a new directive on the use of artificial intelligence in the workplace and the revision of the public procurement directive. The S&D group aims for social and environmental criteria, such as collective bargaining agreements, to play a more significant role in procurement.
Affordable housing is also part of the preliminary demands. Although the EU has no direct competence in this area, it can influence housing through easier financing from the European Investment Bank (EIB) and less restrictive conditions for state support. The measures aim to ensure a “constant and additional flow of housing investments of at least €50 billion per year“.
Another core demand is a European anti-poverty strategy. The Socialists and Social Democrats primarily seek a directive on minimum income – not a basic income, but a regulation on minimum safety nets in cases of unemployment, illness, or retirement. Recently, the EU took a step in social policy with the minimum wage directive.
Phase-out for fossil fuel subsidies
In the second chapter on the Green Deal, the Social Democrats advocate maintaining CO2 standards for cars and a climate target of 90 to 95 percent reduction in greenhouse gases by 2040. The 2014 Energy Security Regulation’s revision will be key for the energy legislation following the climate law.
Under the new concept of energy security, S&D outlines new energy policy goals, including a European facility for energy networks and storage, and a mandatory phase-out of all fossil fuel subsidies. This phase-out would be combined with stronger social measures, such as a directive with occupation-specific plans for the transition of the workforce. ber/lei
In the first half of the parliamentary term, committees in the European Parliament should be able to work on up to six own-initiative reports at the same time. In the first two and a half years, a subcommittee should also be able to work on three own-initiative reports at the same time. This is the regulation proposed by the parliamentary administration. The proposal is available to Table.Briefings.
It is thus implementing a demand made by the Parliament 2024 Reform Commission under Roberta Metsola. In the second half of the parliamentary term, each committee should be able to have three own-initiative reports in progress, and subcommittees an additional two. The vote on a committee’s own-initiative report should take place at the earliest three months after the own-initiative report has been approved. The decision as to whether a committee can draw up an own-initiative report is made by the Conference of Presidents. mgr
Travel by committees: These are the rules proposed by the parliamentary administration
In the future, a committee, subcommittee, or delegation in the European Parliament will be allowed to travel to the same non-EU country no more than twice a year. The administration of the European Parliament had still provided for one trip per country and per committee outside the EU in its proposal for the new implementing rules on missions, which is available to Table.Briefings.
However, an upper limit of two trips per committee and destination per year is now emerging. Trips to international conferences and international organizations are to be exempt from this rule. Trips to candidate countries are also not included.
Committee missions must be requested from the Conference of Presidents six months in advance. If two committees or delegations wish to travel to the same country, they should do so together. This rule should not apply to the Trade Committee (INT). It should be ensured that the Trade Committee can undertake trips in small groups on specific trade issues.
Ad hoc trips, which do not have to be approved six months in advance, are possible, for example in the case of special unforeseen events or the form of fact-finding trips by reporters.
Depending on the size of the committee, there should be upper limits for the annual number of participants on trips:
60 percent of the members of a committee for committees with fewer than 30 members
55 percent of members for committees with 30 to 50 members
50 percent of members for committees with more than 50 members
The political groups are to have a say in the appointment of participants according to the D’Hondt system. A maximum of twelve participants will be allowed to travel. The upper time limit for business trips is three days – within the EU including arrival and departure, outside the EU arrival and departure are added to the three days. mgr
Roberta Metsola
NATO fails to reach agreement on multi-year aid for Ukraine
NATO Secretary General Jens Stoltenberg has failed in his attempt to persuade the alliance states to make multi-year commitments for military aid to Ukraine. In the run-up to a summit meeting in Washington, the 32 allies were only able to agree to provide support of at least €40 billion within the next year, as the German Press Agency learned from several delegations.
A concrete agreement on the question of who contributes how much could not be reached either, according to the information provided. The NATO states have only vaguely stated that gross domestic product should play a role.
Signal to Putin
NATO Secretary-General Jens Stoltenberg had originally called on the allies to guarantee Ukraine long-term military aid worth at least €40 billion annually. It was also a matter of showing Russian President Vladimir Putin that he would not win his war of aggression against Ukraine, he said at a meeting with the foreign ministers of the 32 NATO states in Prague at the end of May. The amount of €40 billion would roughly correspond to the previous annual support of the allies since the start of the Russian invasion.
On the question of how fair burden-sharing could be ensured, Stoltenberg said at the time that one option would be to calculate the contribution of the individual member states on the basis of their gross domestic product. According to this, the USA, Germany, Great Britain, France, and Italy would have to pay by far the largest share of the €40 billion per year.
It had been Stoltenberg’s wish that the 32 NATO states would agree on a common position by next week’s summit in Washington. However, an agreement on a very ambitious pledge was considered unlikely from the outset – partly because countries such as France and Italy have so far only spent a comparatively small proportion of their gross domestic product on military support for Ukraine. dpa
Ukraine
How the market ramp-up for sustainable aviation fuel can succeed
EU legislators must reorganize the production and supply chains of sustainable aviation fuel (SAF) to accelerate the ramp-up of the eco-fuel. This is the demand of PtX-Lab Lausitz, a practical laboratory for fuels made from green hydrogen. The Refuel EU Aviation regulation already mandates the supply of SAF at EU airports, and demand has already increased. However, PtX-Lab Lausitz argues that airlines and fuel manufacturers still lack the flexibility to claim emissions savings through the production and use of SAF.
The authors of PtX Lab Lausitz call for the broad introduction of a so-called “book and claim” (B&C) system. This would allow an airline to order SAF from a manufacturer, but it would not have to use it itself to claim the entry for climate action. The SAFs are subsequently provided at the airports and blended with the fossil kerosene. It is irrelevant who ultimately uses the sustainable fuel. Accordingly, the actual user cannot claim the emissions savings for themselves.
No link to the EU ETS
The authors note that Refuel-EU Aviation already contains B&C approaches that allow providers to meet the mandatory SAF quotas by factoring in the SAF share of the total volume of aviation fuel deliveries. However, the link between this B&C principle and the European Emissions Trading System (ETS) is still missing. This would require airlines to be able to record carbon savings from SAF use in the ETS without having to use the fuel. So far, airlines are only exempt from surrendering carbon credits in the ETS if they use SAF.
The authors also call for strict sustainability criteria for SAF, for example, in line with the EU Renewable Energy Directive (RED). They believe fulfilling the criteria should also be monetizable without excluding less sustainable fuels. For instance, PtX-Lab Lausitz recommends granting market access to suppliers who can only achieve an 80 percent emission reduction compared to fossil kerosene. However, these suppliers could only declare 80 percent of their supply as SAF. luk
Verkehrswende
Lufthansa: These are the Commission’s conditions for the ITA takeover
With the approval of the EU Commission, Lufthansa may take over the Italian state-owned airline ITA Airways and thus grow in one of its most important markets. After lengthy negotiations, the EU competition regulator gave the green light on Wednesday for Lufthansa to acquire an initial 41 percentstake in the successor to Alitalia. Although the airline is currently doing well, its long-term existence as an independent airline is “highly uncertain”, the Commission said.
Competition Commissioner Margrethe Vestager emphasized that the aim was to prevent passengers from paying more or having less choice in times of rising ticket prices. Conditions offered by Lufthansa and the government in Rome ensured competition on all relevant routes.
Lufthansa had agreed with the Italian government in May 2023 to purchase the initial 41% stake in ITA for €325 million. Options for a complete takeover at a later date, from 2025 at the earliest, were also agreed.
Lufthansa and ITA must relinquish take-off and landing rights
The decision by the EU competition authority was preceded by a long tug-of-war between the Commission’s experts and the Italian government as well as Lufthansa. EU Commissioner Vestager had major concerns that the merger could be detrimental to consumers due to excessive market power on certain routes in Europe and on long-haul flights to North America.
This is now to be avoided by imposing conditions on Lufthansa and ITA – including the surrender of take-off and landing rights at Milan Airport for direct flights in Europe. Lufthansa and the Italian government have undertaken to provide one or two competitors with the means to offer direct flights from Milan or Rome. Lufthansa and ITA must also cooperate with rivals for transatlantic flights and take on feeder flights to competitors’ hubs so that they can offer alternatives.
ITA can only join the Lufthansa Group once the EU Commission has approved the purchasers of slots and routes or the cooperation partners. For European flights, these are the low-cost airlines Easyjet from the UK and Volotea from Spain. An independent supervisor is to monitor the implementation of the conditions. In this way, the EU wants to prevent slots from being released, as in previous cases – such as the takeover of Brussels Airlines by Lufthansa – but not being used by rivals due to a lack of profitability. rtr
Margrethe Vestager
Government formation in Sofia failed
In Bulgaria, the formation of a pro-Western government failed after the new elections on June 9. The candidate for Prime Minister nominated by the election winner Gerb-SDS, Rossen Zhelyaskov, fell well short of a majority in a parliamentary vote.
This meant that two further votes were not held, namely on the structure and composition of a minority cabinet. According to Gerb leader Boyko Borisov, this was to prepare Bulgaria for the introduction of the Euro and continue the pro-Ukrainian course of the EU and NATO member state.
Seventh parliamentary election since 2021 looms
Head of state Rumen Radev will now task the second-strongest faction of the liberal Movement for Rights and Freedoms with forming a new government.
The Bulgarian constitution stipulates that a total of three government contracts can be awarded. If all three fail, there will have to be another parliamentary election. It would then be the seventh since April 2021. Until a regular government is formed in Sofia, a transitional cabinet will run the government. dpa
Christof-Sebastian Klitz, Head of VW’s Group Representative Office in Brussels, has retired after more than 20 years as the Group’s chief lobbyist. Sebastian Schaffer will initially take over the management of the office with six employees on an interim basis.
Is something changing in your organization? Send a note for our personnel section to heads@table.media!
Opinion
New opportunities for EU-UK relations after the British elections
By Nicolai von Ondarza
Nicolai von Ondarza is head of the EU/Europe research group at the German Institute for International and Security Affairs (SWP).
Polls predict a significant victory for the Labour Party under Keir Starmer. However, even with a change in government, no fundamental reversal of Brexit is expected. Labour has already ruled out a return to the EU single market or the customs union, as well as any form of cooperation that would require a return to free movement or dynamic alignment with EU regulations.
To avoid alienating potential voters, the party has largely avoided the topic of Brexit during the campaign. However, Labour aims to negotiate technical adjustments such as a new veterinary agreement with the EU, and particularly seeks to forge a new geopolitical partnership in the form of an EU-UK security pact.
Foreign and security policy offer a promising avenue for cautious rapprochement. Even under the current Conservative government of Rishi Sunak, relations with the EU in this area have improved. The Windsor Agreement ended the dispute over Northern Ireland, and Russia’s war against Ukraine highlighted the need for closer coordination. This coordination, however, has mostly occurred ad hoc or through the G7 or trilaterally with the USA, as the previous Conservative government rejected a structured dialogue with Brussels on foreign and security policy.
Closer cooperation in this area is in the mutual interest of both parties. For the EU, the UK is a key partner with its diplomatic and military resources and a capable defense industry – especially in light of Russia’s war against Ukraine and the potential return of Donald Trump to the White House. For Labour, it represents a field of cooperation that does not require adopting EU regulations from the Single Market.
At the same time, in most foreign and security policy issues, a drastic shift from a Tory to a Labour government is not expected: both prioritize supporting Ukraine, emphasize the importance of the USA as an ally (even under Trump), and pursue a cautious course of “de-risking” with China, which largely aligns with the European mainstream. Differences mainly lie in climate policy, which Labour wants to focus on more, attitudes toward the Middle East conflict, and EU-UK relations.
More flexibility required from the EU
To fully realize the potential for cooperation, the EU must also show more flexibility. So far, EU member states insist on treating the UK like any other third country. This leads to the so-called “Galileo problem“: Despite the UK’s significant resources in foreign and security policy, even with only informal participation, the EU only offers the country very restrictive rules meant for third countries – like Norway, for example. This is unacceptable for London, even under a potential Labour government, for instance in joint European ammunition procurement.
Preventing cooperation for such formal reasons does not reflect Europe’s new geostrategic reality. Instead, the EU and the UK should develop a new model of cooperation based on partnership, not reintegration. Specifically, this could include three elements. First, regular strategic consultations at the highest political level. Second, mixed working groups on specific issues like sanctions. Third, limited UK participation in selected EU summits. Legally, such an initiative could be linked to the existing Trade and Cooperation Agreement.
Germany’s role in driving flexible solutions
Germany should play a key role in implementing this. Berlin has a strong interest in closely involving London in European foreign and security policy. Moreover, Labour, inspired by the British-French Lancaster House treaties, seeks to deepen British-German defense cooperation. This offer should be utilized by Berlin and embedded from the beginning in a broader EU-UK security pact.
The coming months present a crucial window of opportunity: After the British elections but before the heated phase of the US election campaign, there is a chance to set the course for deeper cooperation. The EU and the UK should seize it for the sake of European security and the transatlantic alliance.
The EU Commission will today publish the regulation in which it will set out the import duties for the individual EV manufacturers. According to Brussels, there will be no surprises, i.e. the tariff rates will largely correspond to what the Commission announced to manufacturers on June 12.
This is a predictable disappointmentfor theGerman government. In the name of open markets, it had campaigned for a negotiated solution. Its main aim was to reduce trade risks for German industry.
Minister for Economic Affairs Robert Habeck reacted with great satisfaction in Beijing when China began negotiations with Brussels on the tariffs during his visit. This at least opened the door to an amicable solution. However, the talks between Beijing and Brussels have so far produced little movement. Far from considering its subsidies unfair, Beijing sees them as legitimate support for an emerging industry – and conversely points to high subsidies in the EU for several sectors.
Instead, the Chinese side is falling back into its usual pattern of dividing the EU instead of arguingon the merits. This is because the member states will not decide on the final amount of the levies until November. Companies that import EVs from China will therefore not have to pay them until November. Until then, the payments will be paid into escrow accounts.
Your Till Hoppe
Feature
How the industry is fighting for lower energy prices
According to a new study commissioned by the industry association Business Europe, electricity prices in the EU will remain significantly higher than in other major economies even if the energy transition is successful. A rapid expansion of low-carbon energy at the most favorable locations could make electricity in the EU 40% cheaper.
“However, our new study shows that energy prices in Europewill be at least 50 percent higher than in the USA, China and India by 2050, even if the EU pushes ahead with its energy policy”, says Markus J. Beyrer, Director General of Business Europe. The study expects the lowest electricity generation costs for India.
Extend carbon leakage regulation to include energy costs
The paper published today was available to Table.Briefings in advance. It can be read as an attempt to give the debate on a state-subsidized industrial electricity price a new spin. Business Europe builds on the generally recognized carbon leakage definition from emissions trading and wants to expand the term from CO2 to energy system costs.
On the one hand, the association is calling for changes to the CBAM border adjustment mechanism and longer compensation for CO2 costs – particularly for steel and fertilizer production. However, according to the association, the sectors affected by relocation due to high energy prices could be different from those threatened with relocation due to high CO2 costs.
Relief due to infrastructure expansion
The EU must therefore pursue a broader concept of carbon leakage and also include cost burdens for energy and infrastructure, Business Europe demands. In response, the association prefers higher EU funding with the hydrogen bank auctions as a model. Further measures should be left to the member states – for example, a reduction in grid charges for electricity cost-intensive companies, as has long been the case in Germany.
“This will become increasingly important in the coming years as investment in energy infrastructures increases”, writes Business Europe. The Chancellery has also identified rising grid fees as one of the most important economic policy issues for the coming years. In a recent interview with Table.Briefings, Tennet COO Tim Meyerjürgens said that Germany alone is facing investments in the grids amounting to €500 billion. However, reductions for certain companies are paid for by non-beneficiary businesses and household customers.
Internal electricity market and electrification lower energy prices
The study also shows the costs of a faltering energy transition. In a slower scenario, electricity prices stabilize at €110 per megawatt hour in the long term, andat €65/MWh on the more ambitious path. The prerequisites are:
More transmission capacities between the member states and a common internal electricity market – contrary to current threats from Jordan Bardella of the Rassemblement National;
Increasing the electrification rate from 21% today to 56% and a reduced role for hydrogen;
Strong expansion of renewable energies, especially in favorable locations on the Iberian Peninsula and in Scandinavia;
A multiplication of flexibilities to compensate for lulls in renewables. For the most cost-effective option, the capacities of batteriesshould increase five times as much as those of gas or hydrogen power plants;
Similarly high capacities of nuclear power plants (99 GW) as today, which stabilize electricity prices, but require immense subsidies due to an outdated power plant fleet.
For cost reasons, Business Europe is advocating greater use of low-carbon – i.e. essentially blue – hydrogen. According to PIK, the energy carrier obtained from natural gas with Carbon Capture and Storage (CCS) could still be cheaper beyond 2040 than green hydrogen produced by electrolysis with green electricity.
More blue hydrogen and amendment of environmental planning law
The association therefore wants a “targeted evaluation” of the industry quota for green hydrogen in the Renewable Energy Directive (RED). The experts recommend an amendment to the RED so that not only RFNBO but also low-carbon hydrogen is recognized as a fulfillment option in the quota.
In its recommendations, however, Business Europe tends to oppose “inflating the denominator”, which currently includes all forms of hydrogen, including low-carbon hydrogen. The second-best option from an industry perspective would therefore appear to be not to include blue H2 in the numerator, but to exclude it from the denominator. Both would reduce the absolute amount of green hydrogen needed in the industry.
Nature conservation associations are also unlikely to be pleased: Despite the recent acceleration of approval procedures, Business Europe is calling for further interventions in environmental planning law in order to simplify the conversion of industrial plants for decarbonization. The association wants a corresponding amendment to the Strategic Environmental Assessment (SEA) Directive and a time limit for Environmental Impact Assessments (EIA).
Grüner Wasserstoff
Translation missing.
Events
July 5-6, 2024; Tutzing (Germany) D21, SeminarDemocracy in the digital age: the 2024 super election year The D21 initiative explores the question of how digitalization is shaping the future of elections and thus our democracy.INFO & REGISTRATION
July 8, 2024; 9 a.m.-6 p.m., Fiesole (Italy) EUI, Conference3rd Florence Rail Regulation Conference The Florence School of Regulation (FSR) evaluates existing policies and analyzes new proposals to accelerate the growth of the Railways Industry.INFO & REGISTRATION
Translation missing.
News
No new faction around the BSW
The formation of a new parliamentary group in the European Parliament around the Sahra Wagenknecht alliance (BSW) has failed. This was admitted by BSW lead candidate Fabio De Masi on Wednesday. They had come very close to forming a new parliamentary group in the meantime but had not found enough supporters. Now they want to work closely with other critics of the Commission under Ursula von der Leyen, even without a parliamentary group. “Von der Leyen will not receive a vote from us”, said De Masi. Without a parliamentary group, the six BSW MEPs will not be able to lay claim to committee chairmanships.
The BSW had been working with the Italian Five Star Movement to form a new parliamentary group. However, the movement is now negotiating with the leadership of the Left parliamentary group about joining. A meeting is planned for today, Thursday, and the decision should be made by the evening. The Five Star Movement has eight MEPs in the European Parliament.
Martin Schirdewan remains co-leader of the left-wing parliamentary group
The parliamentary group of the Left Party is once again likely to be led by two co-chairs: The current co-chair Manon Aubry from France is to hold the office for the entire parliamentary term, as decided by the extended parliamentary group executive committee. Her current co-chair Martin Schirdewan is to hold office for the first half of the parliamentary term and hand over to Kostas Arvanitis from Syriza in Greece after two and a half years. The Left Group has 39 members. The delegation of three German MEPs is led by Özlem Alev Demirel.
The parliamentary groups are to be formed by this Thursday. However, this is not a hard deadline: changes are basically still possible until the constituent meeting on July 16. To form a political group in the European Parliament, 23 MEPs from seven countries are required.
Right-wingers still sorting themselves out
No further major changes are foreseeable in the centrist groups. The liberal Renew Group will accept two more MEPs from Ireland, and there are also talks with an MEP from Cyprus. Individual non-attached MEPs may also join the Greens. However, it was unclear until Wednesday evening whether this would happen.
The conservative ECR Group was constituted on Wednesday. Nicola Procaccini from the Fratelli D’Italia and Joachim Brudziński from the Polish PiS are co-leaders of the group. With 24 MEPs, the Fratelli make up the largest delegation in the group. The PiS forms the second-strongest delegation with 20 MEPs. It is now clear that the PiS will remain in the group. There had previously been speculation as to whether the PiS would form a group together with the Hungarian Fidesz. The EKR parliamentary group now has 84 members, making it the third-largest group. Jaak Madison from Estonia recently joined the EKR.
Orbán negotiates with Le Pen
There is still the most movement in the national conservative and far-right camps. Hungary’s Prime Minister Viktor Orbán wants to form a new parliamentary group, the “Patriots for Europe“, which is likely to be joined by the FPÖ and the Ano of Czech billionaire Andrej Babiš. It is foreseeable that the Portuguese Chega MEPs and parliamentarians from Matteo Salvini’s Lega will join.
There are also intense talks between Orbán and the leadership of the Rassemblement National, Marine Le Pen and Jordan Bardella. However, it will probably not be clear whether they will work together until after the second round of the French parliamentary elections on Sunday. The ID parliamentary group, of which the RN has been a member to date, has postponed its constituent meeting until next week.
However, the AfD will definitely not be part of the new parliamentary group, as party leader Alice Weidel confirmed on Tuesday. Orbán considers the German right-wing party too radical and fears additional conflicts with the German government. mgr, tho, luk, sas
S&D: These are the demands for the next five years
The Social Democrats in the European Parliament are contemplating a proposal for an EU-wide harmonized tax on corporate stock buybacks. This issue is highlighted in an eleven-page draft of the core demands of the S&D group for the next legislative term, obtained by Table.Briefings on Wednesday. While the Social Democrats have not yet reached a final agreement in their group meeting, the delegation leaders are expected to reach a consensus soon.
The draft also calls for effective minimum taxation of capital gains at the EU level, a framework for systematic taxation of windfall profits, and a broad-based financial transaction tax. This tax should be set high enough to deter speculation and generate substantial revenue.
Action program for social progress and quality employment
The first section of the document is dedicated to an action program for social progress and quality employment. This program includes a range of measures, such as a new directive on the use of artificial intelligence in the workplace and the revision of the public procurement directive. The S&D group aims for social and environmental criteria, such as collective bargaining agreements, to play a more significant role in procurement.
Affordable housing is also part of the preliminary demands. Although the EU has no direct competence in this area, it can influence housing through easier financing from the European Investment Bank (EIB) and less restrictive conditions for state support. The measures aim to ensure a “constant and additional flow of housing investments of at least €50 billion per year“.
Another core demand is a European anti-poverty strategy. The Socialists and Social Democrats primarily seek a directive on minimum income – not a basic income, but a regulation on minimum safety nets in cases of unemployment, illness, or retirement. Recently, the EU took a step in social policy with the minimum wage directive.
Phase-out for fossil fuel subsidies
In the second chapter on the Green Deal, the Social Democrats advocate maintaining CO2 standards for cars and a climate target of 90 to 95 percent reduction in greenhouse gases by 2040. The 2014 Energy Security Regulation’s revision will be key for the energy legislation following the climate law.
Under the new concept of energy security, S&D outlines new energy policy goals, including a European facility for energy networks and storage, and a mandatory phase-out of all fossil fuel subsidies. This phase-out would be combined with stronger social measures, such as a directive with occupation-specific plans for the transition of the workforce. ber/lei
In the first half of the parliamentary term, committees in the European Parliament should be able to work on up to six own-initiative reports at the same time. In the first two and a half years, a subcommittee should also be able to work on three own-initiative reports at the same time. This is the regulation proposed by the parliamentary administration. The proposal is available to Table.Briefings.
It is thus implementing a demand made by the Parliament 2024 Reform Commission under Roberta Metsola. In the second half of the parliamentary term, each committee should be able to have three own-initiative reports in progress, and subcommittees an additional two. The vote on a committee’s own-initiative report should take place at the earliest three months after the own-initiative report has been approved. The decision as to whether a committee can draw up an own-initiative report is made by the Conference of Presidents. mgr
Travel by committees: These are the rules proposed by the parliamentary administration
In the future, a committee, subcommittee, or delegation in the European Parliament will be allowed to travel to the same non-EU country no more than twice a year. The administration of the European Parliament had still provided for one trip per country and per committee outside the EU in its proposal for the new implementing rules on missions, which is available to Table.Briefings.
However, an upper limit of two trips per committee and destination per year is now emerging. Trips to international conferences and international organizations are to be exempt from this rule. Trips to candidate countries are also not included.
Committee missions must be requested from the Conference of Presidents six months in advance. If two committees or delegations wish to travel to the same country, they should do so together. This rule should not apply to the Trade Committee (INT). It should be ensured that the Trade Committee can undertake trips in small groups on specific trade issues.
Ad hoc trips, which do not have to be approved six months in advance, are possible, for example in the case of special unforeseen events or the form of fact-finding trips by reporters.
Depending on the size of the committee, there should be upper limits for the annual number of participants on trips:
60 percent of the members of a committee for committees with fewer than 30 members
55 percent of members for committees with 30 to 50 members
50 percent of members for committees with more than 50 members
The political groups are to have a say in the appointment of participants according to the D’Hondt system. A maximum of twelve participants will be allowed to travel. The upper time limit for business trips is three days – within the EU including arrival and departure, outside the EU arrival and departure are added to the three days. mgr
Roberta Metsola
NATO fails to reach agreement on multi-year aid for Ukraine
NATO Secretary General Jens Stoltenberg has failed in his attempt to persuade the alliance states to make multi-year commitments for military aid to Ukraine. In the run-up to a summit meeting in Washington, the 32 allies were only able to agree to provide support of at least €40 billion within the next year, as the German Press Agency learned from several delegations.
A concrete agreement on the question of who contributes how much could not be reached either, according to the information provided. The NATO states have only vaguely stated that gross domestic product should play a role.
Signal to Putin
NATO Secretary-General Jens Stoltenberg had originally called on the allies to guarantee Ukraine long-term military aid worth at least €40 billion annually. It was also a matter of showing Russian President Vladimir Putin that he would not win his war of aggression against Ukraine, he said at a meeting with the foreign ministers of the 32 NATO states in Prague at the end of May. The amount of €40 billion would roughly correspond to the previous annual support of the allies since the start of the Russian invasion.
On the question of how fair burden-sharing could be ensured, Stoltenberg said at the time that one option would be to calculate the contribution of the individual member states on the basis of their gross domestic product. According to this, the USA, Germany, Great Britain, France, and Italy would have to pay by far the largest share of the €40 billion per year.
It had been Stoltenberg’s wish that the 32 NATO states would agree on a common position by next week’s summit in Washington. However, an agreement on a very ambitious pledge was considered unlikely from the outset – partly because countries such as France and Italy have so far only spent a comparatively small proportion of their gross domestic product on military support for Ukraine. dpa
Ukraine
How the market ramp-up for sustainable aviation fuel can succeed
EU legislators must reorganize the production and supply chains of sustainable aviation fuel (SAF) to accelerate the ramp-up of the eco-fuel. This is the demand of PtX-Lab Lausitz, a practical laboratory for fuels made from green hydrogen. The Refuel EU Aviation regulation already mandates the supply of SAF at EU airports, and demand has already increased. However, PtX-Lab Lausitz argues that airlines and fuel manufacturers still lack the flexibility to claim emissions savings through the production and use of SAF.
The authors of PtX Lab Lausitz call for the broad introduction of a so-called “book and claim” (B&C) system. This would allow an airline to order SAF from a manufacturer, but it would not have to use it itself to claim the entry for climate action. The SAFs are subsequently provided at the airports and blended with the fossil kerosene. It is irrelevant who ultimately uses the sustainable fuel. Accordingly, the actual user cannot claim the emissions savings for themselves.
No link to the EU ETS
The authors note that Refuel-EU Aviation already contains B&C approaches that allow providers to meet the mandatory SAF quotas by factoring in the SAF share of the total volume of aviation fuel deliveries. However, the link between this B&C principle and the European Emissions Trading System (ETS) is still missing. This would require airlines to be able to record carbon savings from SAF use in the ETS without having to use the fuel. So far, airlines are only exempt from surrendering carbon credits in the ETS if they use SAF.
The authors also call for strict sustainability criteria for SAF, for example, in line with the EU Renewable Energy Directive (RED). They believe fulfilling the criteria should also be monetizable without excluding less sustainable fuels. For instance, PtX-Lab Lausitz recommends granting market access to suppliers who can only achieve an 80 percent emission reduction compared to fossil kerosene. However, these suppliers could only declare 80 percent of their supply as SAF. luk
Verkehrswende
Lufthansa: These are the Commission’s conditions for the ITA takeover
With the approval of the EU Commission, Lufthansa may take over the Italian state-owned airline ITA Airways and thus grow in one of its most important markets. After lengthy negotiations, the EU competition regulator gave the green light on Wednesday for Lufthansa to acquire an initial 41 percentstake in the successor to Alitalia. Although the airline is currently doing well, its long-term existence as an independent airline is “highly uncertain”, the Commission said.
Competition Commissioner Margrethe Vestager emphasized that the aim was to prevent passengers from paying more or having less choice in times of rising ticket prices. Conditions offered by Lufthansa and the government in Rome ensured competition on all relevant routes.
Lufthansa had agreed with the Italian government in May 2023 to purchase the initial 41% stake in ITA for €325 million. Options for a complete takeover at a later date, from 2025 at the earliest, were also agreed.
Lufthansa and ITA must relinquish take-off and landing rights
The decision by the EU competition authority was preceded by a long tug-of-war between the Commission’s experts and the Italian government as well as Lufthansa. EU Commissioner Vestager had major concerns that the merger could be detrimental to consumers due to excessive market power on certain routes in Europe and on long-haul flights to North America.
This is now to be avoided by imposing conditions on Lufthansa and ITA – including the surrender of take-off and landing rights at Milan Airport for direct flights in Europe. Lufthansa and the Italian government have undertaken to provide one or two competitors with the means to offer direct flights from Milan or Rome. Lufthansa and ITA must also cooperate with rivals for transatlantic flights and take on feeder flights to competitors’ hubs so that they can offer alternatives.
ITA can only join the Lufthansa Group once the EU Commission has approved the purchasers of slots and routes or the cooperation partners. For European flights, these are the low-cost airlines Easyjet from the UK and Volotea from Spain. An independent supervisor is to monitor the implementation of the conditions. In this way, the EU wants to prevent slots from being released, as in previous cases – such as the takeover of Brussels Airlines by Lufthansa – but not being used by rivals due to a lack of profitability. rtr
Margrethe Vestager
Government formation in Sofia failed
In Bulgaria, the formation of a pro-Western government failed after the new elections on June 9. The candidate for Prime Minister nominated by the election winner Gerb-SDS, Rossen Zhelyaskov, fell well short of a majority in a parliamentary vote.
This meant that two further votes were not held, namely on the structure and composition of a minority cabinet. According to Gerb leader Boyko Borisov, this was to prepare Bulgaria for the introduction of the Euro and continue the pro-Ukrainian course of the EU and NATO member state.
Seventh parliamentary election since 2021 looms
Head of state Rumen Radev will now task the second-strongest faction of the liberal Movement for Rights and Freedoms with forming a new government.
The Bulgarian constitution stipulates that a total of three government contracts can be awarded. If all three fail, there will have to be another parliamentary election. It would then be the seventh since April 2021. Until a regular government is formed in Sofia, a transitional cabinet will run the government. dpa
Christof-Sebastian Klitz, Head of VW’s Group Representative Office in Brussels, has retired after more than 20 years as the Group’s chief lobbyist. Sebastian Schaffer will initially take over the management of the office with six employees on an interim basis.
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Opinion
New opportunities for EU-UK relations after the British elections
By Nicolai von Ondarza
Nicolai von Ondarza is head of the EU/Europe research group at the German Institute for International and Security Affairs (SWP).
Polls predict a significant victory for the Labour Party under Keir Starmer. However, even with a change in government, no fundamental reversal of Brexit is expected. Labour has already ruled out a return to the EU single market or the customs union, as well as any form of cooperation that would require a return to free movement or dynamic alignment with EU regulations.
To avoid alienating potential voters, the party has largely avoided the topic of Brexit during the campaign. However, Labour aims to negotiate technical adjustments such as a new veterinary agreement with the EU, and particularly seeks to forge a new geopolitical partnership in the form of an EU-UK security pact.
Foreign and security policy offer a promising avenue for cautious rapprochement. Even under the current Conservative government of Rishi Sunak, relations with the EU in this area have improved. The Windsor Agreement ended the dispute over Northern Ireland, and Russia’s war against Ukraine highlighted the need for closer coordination. This coordination, however, has mostly occurred ad hoc or through the G7 or trilaterally with the USA, as the previous Conservative government rejected a structured dialogue with Brussels on foreign and security policy.
Closer cooperation in this area is in the mutual interest of both parties. For the EU, the UK is a key partner with its diplomatic and military resources and a capable defense industry – especially in light of Russia’s war against Ukraine and the potential return of Donald Trump to the White House. For Labour, it represents a field of cooperation that does not require adopting EU regulations from the Single Market.
At the same time, in most foreign and security policy issues, a drastic shift from a Tory to a Labour government is not expected: both prioritize supporting Ukraine, emphasize the importance of the USA as an ally (even under Trump), and pursue a cautious course of “de-risking” with China, which largely aligns with the European mainstream. Differences mainly lie in climate policy, which Labour wants to focus on more, attitudes toward the Middle East conflict, and EU-UK relations.
More flexibility required from the EU
To fully realize the potential for cooperation, the EU must also show more flexibility. So far, EU member states insist on treating the UK like any other third country. This leads to the so-called “Galileo problem“: Despite the UK’s significant resources in foreign and security policy, even with only informal participation, the EU only offers the country very restrictive rules meant for third countries – like Norway, for example. This is unacceptable for London, even under a potential Labour government, for instance in joint European ammunition procurement.
Preventing cooperation for such formal reasons does not reflect Europe’s new geostrategic reality. Instead, the EU and the UK should develop a new model of cooperation based on partnership, not reintegration. Specifically, this could include three elements. First, regular strategic consultations at the highest political level. Second, mixed working groups on specific issues like sanctions. Third, limited UK participation in selected EU summits. Legally, such an initiative could be linked to the existing Trade and Cooperation Agreement.
Germany’s role in driving flexible solutions
Germany should play a key role in implementing this. Berlin has a strong interest in closely involving London in European foreign and security policy. Moreover, Labour, inspired by the British-French Lancaster House treaties, seeks to deepen British-German defense cooperation. This offer should be utilized by Berlin and embedded from the beginning in a broader EU-UK security pact.
The coming months present a crucial window of opportunity: After the British elections but before the heated phase of the US election campaign, there is a chance to set the course for deeper cooperation. The EU and the UK should seize it for the sake of European security and the transatlantic alliance.
