Gas: hardly any solidarity agreements so • Table.Briefings

Dear reader,

Hungary’s head of government Viktor Orbán got his way: Patriarch Kirill is no longer on the sanctions list. As a result, the sixth package of sanctions against Russia, including a partial embargo on oil, is expected to enter into force today, Friday, if no other country lodges an objection by 9 am.

Although an embargo also against Russian gas is not far-fetched, only very few EU countries have so far concluded solidarity agreements with their neighbors for gas supplies. Exactly five of these agreements exist, and this is despite the fact that the SoS Regulation has provided for them for every country since 2018 at the latest. It is and remains questionable whether the EU member states would be prepared for a complete loss of Russian gas supplies, writes Manuel Berkel in his Feature.

Blockchains are databases that can only be changed by adding further data; nothing can be deleted. This makes them very powerful and inherently transparent tools, but poses huge challenges for the EU. After all, if it wants to make the technology usable and compatible with its values, sooner or later it will have to find a way to saturate blockchains in a way that complies with data protection laws. Jürgen Geuter has taken a look at the EU’s blockchain strategy.

There is a change of personnel at Germany’s Permanent Representation to the EU. Deputy Ambassador Susanne Szech-Koundouros, who among other roles represented the German government in Coreper I over the course of four years, is giving up her post and returning to Berlin. Read about who will succeed her in the News.

I wish you a nice long Pentecost weekend!

Your
Lisa-Martina Klein

Member states drag out gas agreement

In the current gas crisis, EU bodies repeatedly invoke the unity of member states. In fact, national governments have so far done little to stand by each other in an emergency, as an overview by the European Commission shows.

Before the member states can support each other in the event of a gas embargo, technical, legal and financial details must first be settled. To do this, each EU member would actually have to conclude so-called solidarity agreements with each of its neighboring countries. A corresponding deadline from the SoS Regulation, which came into force in October 2017, expired long before the current crisis, namely in December 2018. The 27 governments have largely ignored this hint.

The Commission currently has only five agreements on its website – the first from December 2020, two years after the obligation to transpose expired. The German government concluded it with Denmark at the time, followed a year later by an agreement with Austria. The other three agreements all date from recent months. The most recent was concluded between Estonia and Finland on April 25 – a few days after Russia cut off gas to the Finns. A pipeline from Estonia can now be used to provide a replacement.

Even if agreements can apparently be concluded quickly in the case of embargoes against individual states, the question is whether the EU27 is sufficiently prepared for a complete breakdown of Russian supplies. Despite long negotiations with its remaining neighbors, Germany has still not been able to agree on further agreements.

Negotiations with Germany’s neighbors stall

At the end of March, the German Ministry of Economics had stated that a signature with Italy was imminent, and negotiations with Poland and the Czech Republic were well advanced. With France, Belgium, Luxembourg and the Netherlands, there was an “exchange” that was being deepened, as was stated at the time. Since then, there have been no concrete conclusions. Negotiations are still ongoing, a spokeswoman for the BMWK told Europe.Table on Thursday.

Given the widespread hesitation among member states, the Commission has been trying to take precautions for a while now. After gas prices began to rise last fall, it included a special standard form in Annex II of the internal gas market package of mid-December for those states that have not concluded solidarity agreements. A ten-page Word template is now to serve as a solidarity request if EU states find themselves without sufficient gas.

Other articles for the amendment of the Gas Market Regulation include joint procurement of strategic stocks and the joint use of storage facilities. They are likely to become particularly important from 2026, when the rules of the Gas Storage Regulation of mid-May expire. Between June 17 and 24, the lead MEPs Jens Geier (S&D) and Jerzy Buzek (EPP) want to finalize their reports on the gas market package.

In addition to the joint use of the existing gas infrastructure, however, new investments are also needed to manage without Russian gas. Possible projects had been identified by European transmission system operators. In Annex 3 to REPowerEU, the Commission cited calculations by ENTSOG in mid-May that Germany, for example, needed even better connections to the Western European network in addition to two LNG terminals of its own. “LNG will play an important role for Europe, landing especially in the west of Europe,” confirmed the association of German network operators, FNB Gas, when asked.

Belgium plans better connection to LNG terminal

ENTSOG’s wish list includes a so-called deodorization plant on the French-German border, which could be used to remove the odorous substances added in France from the gas so that it can be fed into the German grid.

However, the Economics Ministry denies that better connections to the Western European network would make the construction of more LNG terminals on the German coasts unnecessary. “It cannot be assumed that an expansion of pipeline capacities to Belgium will make terminals unnecessary; the important thing is that we still have room for ‘reserve volumes‘ here. The same applies with regard to the construction of a deodorization plant on the border with France,” said the ministry’s spokeswoman.

In Belgium, planning is already at an advanced stage. The infrastructure company Fluxys is planning a better connection to the LNG terminal in Zeebrugge. A 48-kilometer connecting pipeline on the Belgian side could increase export capacity to Germany by 6.2 billion cubic meters (bcm) per year, a company spokesman explains. An investment decision is expected to be made by the end of July. Through an accelerated permitting process, Fluxys hopes to have the facility up and running by the end of 2023 or early 2024. In addition, the Zeebrugge LNG terminal plans to gradually increase its capacity by 2026.

Berlin sees threat to security of supply

The situation in France is more complicated. The Republic is the only neighboring German country that already odorizes its gas in the transport networks and not only in the regional distribution networks. Years ago, the French network operator brought up the idea of building a deodorization plant so that more gas could be piped to Germany. However, due to a lack of interest from market participants, this project was scrapped in 2019, a GRTgaz spokeswoman explained when asked. At the current time, there is also no new confirmed plan.

The network operator on the Baden-Württemberg side also denies new investments: “terranets bw is not planning to build new interconnectors to the French gas network or a deodorization plant. Rather, optimal use or, if necessary, technical additions to the existing border crossing points are being considered.”

In the meantime, however, the problem is also occupying Berlin. “Thus, the different odorization practices between the member states represent an obstacle to the cross-border flow of gas, which leads to a threat to European supply security, especially in times of crisis. The German government is aware of this problem and is in exchange with the French government to find a solution,” the spokeswoman of the Ministry of Economics announced.

Federal government demands technical conversions from EU states

Instead of relying on the construction of expensive infrastructure in Germany, Berlin apparently prefers to persuade Paris to make technical changes to the gas network. “However, a single deodorization plant at the border is not suitable for ensuring an unhindered gas flow throughout Europe. Rather, it can only remove the restriction on cross-border gas flow selectively between two member states. It therefore seems more sensible to standardize the practice by waiving odorization at the transmission level as a whole in the EU.”

This requirement could affect other EU countries besides France. As can be seen from an overview by Marcogaz, odorization in the transmission network exists primarily in Spain and Ireland, but also in Portugal, Italy, Greece, and Romania.

The Ministry of Economics bases its demand on a network code for the interoperability of European gas networks: “If no agreement is reached in the procedure provided for therein, the final consequence is to switch to non-odorized gas in the transmission network.”

What’s wrong with the EU’s blockchain strategy?

Under the impression of the financial crisis, an unknown author under the pseudonym “Satoshi Nakamoto” wrote the so-called “Bitcoin Whitepaper” in 2008, in which he described the idea of a decentralized database that could only be changed by appending it, based on established technologies and processes: blockchains were born. A good 13 years, several crashes and crises later, the EU presents its “Blockchain Strategy”. With this, it hopes to promote blockchains as future technology and strategic asset to help the EU become a leader in this sector.

Blockchains are repeatedly criticized not only because of the enormous energy consumption of the two large chains Bitcoin and Ethereum: The high number of dubious and unregulated speculative transactions that characterize the blockchain sector today also illustrate a clear need for regulation. How does the EU’s blockchain strategy position itself here and does it live up to the goals and values the EU has set for itself?

The Blockchain Strategy defines five core elements necessary for blockchains to comply with EU values and rules:

Sustainability with regard to the environment and resources
Compliance with data protection legislation
Digital identity management
Cybersecurity
Interoperability

The last two points are the easiest to implement – without being trivial: with the use of established cryptographic procedures and the use and establishment of data format standards, these two aspects are more in the realm of hard work. Both are very time-consuming, but the necessary technical competencies can easily be found within the EU.

Nevertheless, blockchains, with their immutability, pose new challenges for cybersecurity that other database technologies do not: in an instance of doubt, the vulnerable code segments are visible to all attackers on the chain, and closing security gaps is often technically more complex than in traditional systems. On the other hand, there are various established solutions in the area of blockchain interoperability on which specific projects can be based.

The other questions, however, are more difficult. For example, there are various blockchains that work with less energy-intensive consensus systems than Bitcoin and Ethereum. However, many of them are so-called “level 2” chains, which are nevertheless anchored in Ethereum, for example, and cannot function without this system and its energy consumption. As decentralized databases that assume to be operated on as many participating computers as possible, blockchains are by definition always more energy-intensive to operate than comparable other database systems. The constantly growing volumes of data, which can never be cleaned up, also lead to significant resource consumption of hard disks.

And there are also structural challenges in the area of compliance with data protection laws: the GDPR grants individuals the right to erasure (Article 17) of information concerning them. Blockchains, however, do not allow this deletion by definition. This makes blockchains fundamentally unsuitable for processing personal or personally identifiable data, which significantly limits their utility for many domains. The strategy talks about blockchains should be compatible with applicable law, but with the GDPR at a fundamental rights level, this soft wording in the strategy does not quite do justice to the regulatory reality.

The idea that individuals should manage their digital identities in a self-sovereign manner, as addressed in point 3, is a popular topos at both federal and EU level right now. However, the reality of existing blockchain systems and the widespread phishing attacks there show that this idea requires an extremely high level of technical competence and time investment from citizens, which is likely to be a major challenge when scaled across the EU.

Tension hardly solvable

The blockchain strategy is intended to boost the European blockchain sector through massive funding programs and the establishment of a pan-European service blockchain with a reference character. The strategy explicitly mentions the promotion of blockchains for the realization of sustainability goals. However, how a decentralized database is supposed to help combat the climate crisis remains completely in the dark.

On the other hand, the will to create legal clarity within the domain is welcome: There are various open construction sites here, especially for the areas of liability, copyright, data protection, and consumer protection. It is very necessary that the EU actively intervenes here and clarifies its legal framework in its application to blockchains.

The EU’s blockchain strategy attempts to capture a technology that is currently in the headlines primarily due to speculative hypes and to make it usable within the framework of EU values. However, the description of the five core requirements already shows how much the characteristics of the technology to be promoted and the goals and values of the EU are often in an almost unresolvable tension. What comes as no surprise to anyone familiar with the history of blockchains: they were explicitly designed to prevent state intervention. The EU’s strategy so far does not convey how it plans to resolve this original contradiction. By Jürgen Geuter

Renewed agreement on sanctions package

EU states waive sanctions against Patriarch Kirill for the time being. Under pressure from Hungary, EU ambassadors took the head of the Russian Orthodox Church off the list to pave the way for the sixth sanctions package against Moscow, diplomats confirmed. The package, including a partial oil embargo, is now due to come into force today unless another member state objects by 9 am.

Hungary’s head of government Viktor Orbán had held up the adoption of the new round of sanctions for four weeks. At Monday’s extraordinary EU summit, leaders agreed politically to halt imports of Russian oil by sea after a transition period. But Orbán followed up on Wednesday, to the annoyance of other governments, by calling for Patriarch Kirill to be removed from the sanctions list.

To enable the necessary unanimity, the other 26 member states accepted the demand. They wanted Kirill to be sanctioned because the 75-year-old maintains close contact with President Vladimir Putin and repeatedly backed his war against Ukraine in his sermons. Orbán justified his stance, saying the freedom of belief of Hungarian religious communities is “sacred and inalienable.” In Brussels, however, it is pointed out that there are only a few thousand Orthodox believers in Hungary, and only a part of them belong to the Orthodox community that professes allegiance to the Patriarchate of Moscow.

Insurance ban threatens

Under the new sanctions package, no more oil will be allowed into the EU by ship next year. However, Hungary, Slovakia and the Czech Republic will be allowed to import Russian oil via the Druzhbba pipeline until further notice because of their high dependence.

In addition, Russia’s largest bank, Sberbank, will be excluded from the Swift financial communications network and several Russian news channels will be banned in the EU. European firms will also be banned from offering services such as auditing or tax advice to Russian companies. The President of the European Parliament, Roberta Metsola, also announced a ban on all representatives of Russian companies.

Far more consequential for Russia would be the EU and UK’s planned ban on insuring tankers with Russian oil on board. As London is by far the most important location for this type of insurance, this would severely curtail Russia’s ability to supply its oil to other customers such as China or India. A joint ban is also being discussed at the G7 level. tho/dpa

Von der Leyen: Poland gets funds only against judicial reform

The EU Commission is taking a new approach to the planned disbursement of financial aid from the COVID-19 reconstruction fund to Poland. In contrast to previous practice, the billions of euros in aid – €23.9 billion in grants and an additional €11.5 billion in loans – will not only be tied to economic policy “milestones. Poland is also to fulfill legal policy conditions.

They are intended to promote the “independence of the legal system” in Poland, according to the EU Commission. By the end of the 2nd quarter – i.e. by the end of June – the controversial disciplinary chamber for judges must be dissolved and replaced by a new system (milestone 1). In addition, the proceedings for judges who have already been dismissed are to be reopened (milestone 2).

In a third step (milestone 3), the Brussels authority then wants to check whether all reforms have been implemented as agreed. However, this is not due to take place until the end of 2024. By then, around half of the billions in aid should have been paid out. The second half could even be paid out by August 2026 without any legal requirements.

“Money for reforms” is then also the new motto in Brussels. “First the milestones have to be reached, then the money will be paid out,” said head of the authorities Ursula von der Leyen on Thursday during a visit to Warsaw. At the same time, she made clear: “We are not yet at the end of the road as far as the rule of law in Poland is concerned.”

Poland acts “reluctantly”

However, the EU Commission has not been consistent in disbursing the money against reforms. Although several commissioners – including the “executive” vice presidents Frans Timmermans and Margrete Vestager – have raised concerns, von der Leyen has shown herself generously.

The conditions for payment, which it formulated as recently as October 2021, have been noticeably relaxed. There is no longer any talk of reinstating the dismissed judges. The authority is also quite relaxed about the penalties Poland will have to pay in the dispute over the judicial system. Von der Leyen nevertheless stressed at Thursday’s press conference that the disciplinary regime as a whole must also be reformed. For example, judges already affected by decisions of the disciplinary chamber would have to be able to have that decision reviewed. Poland’s Prime Minister Mateusz Morawiecki countered, “It’s in our interest that all judges are maximally independent and non-partisan.”

In October 2021, the European Court of Justice ordered the country to pay a penalty of €1 million per day. However, the government in Warsaw is not paying. The EU Commission has therefore moved to offset the fine against other payments to Poland. The country is behaving “reluctantly,” said a Commission expert, but that does not stand in the way of an agreement. Generously, they also overlook the fact that Poland still claims primacy of its national law over EU law. That is a rather theoretical dispute, they say, now it is a matter of practical solutions.

Von der Leyen wanted to announce exactly what these will look like on Thursday afternoon in Warsaw. In addition to the rule of law, the war in Ukraine is also likely to be on the agenda. Since aid for Ukraine-EU diplomats in Brussels suspect-is ultimately more important than the pesky details of Polish judicial reform. ebo

Change in German EU representation

Change in the Permanent Representation of Germany to the EU: the previous Vice Ambassador Susanne Szech-Koundouros will return to Berlin in the summer and will be succeeded by Helen Winter, according to Europe.Table. The Ministerialdirigentin currently still works in the Federal Chancellery, as a group leader for national and international economic policy. She is regarded as a highly reputable civil servant.

Szech-Koundouros had served as Ambassador Michael Clauß‘s deputy for four years and represented the German government in Coreper I, the committee of permanent representatives of the member states in which economic issues are discussed. That the traffic light government is bringing her back is not surprising: the 60-year-old is close to the CDU/CSU, she worked for the CDU/CSU parliamentary group in the Bundestag before moving to Brussels. The official comes from the Federal Ministry of Economics and is likely to return there.

Clauß, on the other hand, will probably remain in office. The diplomat has no party political affiliations and is held in high esteem. In the wake of the COVID-19 pandemic and the Ukraine war, the Permanent Representatives have gained a great deal of political weight in the EU decision-making process; for example, they negotiate the sanctions packages against Russia. Clauß, previously ambassador in Beijing, moved to Brussels four years ago and has earned a reputation there as an excellent expert. tho

Charging infrastructure: transport Council reaches agreement

The transport ministers of the 27 EU member states have agreed on their position on the development of alternative fuel charging infrastructure (AFIR). At the Transport Council on Thursday, the compromise for the General Approach negotiated by the French Council Presidency met with broad approval.

The compromise is largely based on the Commission’s proposal, but it gives the member states more flexibility in expanding the charging infrastructure and takes greater account of the individual technical starting situations of the individual countries. This applies in particular to the expansion of the electric charging infrastructure for heavy-duty vehicles.

By the end of 2025, publicly accessible charging stations for heavy-duty vehicles are to be installed on at least 15 percent of the length of the TEN-T network in each direction of travel. By the end of 2037, charging stations are to be installed on at least 40 percent of the TEN-T network. This is intended to give the countries more individual freedom in terms of expansion.

In its proposal, the Commission had specified distances, which the Council also adopted. In the core of the TEN-T network, for example, there should be a maximum of 60 kilometers between charging stations, and in the extended TEN-T network a maximum of 100 kilometers.

Wissing wanted higher targets

Despite the approval, there was also criticism. The Czech Republic criticized that technical developments in heavy-duty transport for alternative fuels were difficult to predict. Bulgaria also announced that it would not accept any increases in the infrastructure development targets for heavy goods vehicles in the trilogue.

Although Germany, Denmark, and Austria declared their agreement in the sense of a compromise, they went on record saying they would have preferred more ambitious expansion targets for both light and heavy commercial vehicles. For heavy commercial vehicles, in particular, German Transport Minister Volker Wissing would have liked to see a faster ramp-up of charging options from 2025, he said Thursday at the Transport Council in Luxembourg. luk

Hungary threatens trouble with Commission over fuel regulation

Hungary is threatened with trouble from the EU Commission because of discrimination against foreigners at gas stations. A spokeswoman for the Brussels authority confirmed on Thursday that new regulation in force since Friday is currently being examined. It stipulates that owners of vehicles with foreign license plates may no longer benefit from state subsidies.

According to the spokeswoman, Hungary could violate EU rules prohibiting discrimination against consumers on the basis of nationality or residence with the regulation. Restrictions on the internal market can only be justified by compelling reasons, said the spokeswoman. These could concern public order, health, or safety, for example. “They cannot be justified on economic grounds,” said the spokeswoman.

If the Brussels authority concludes in its investigation that Budapest is in breach of EU law, it could initiate so-called infringement proceedings against Hungary. The end result could be a complaint to the European Court of Justice and a fine. The spokeswoman said they learned about the measure from the media.

The fact that foreign motorists are no longer allowed to benefit from the state fuel discount means that they currently have to pay significantly more money for a liter of gas at the pumps. According to media reports, the price is on average 40 percent higher than for Hungarian citizens. dpa

What’s cooking in Brussels

From Claire Stam

Lobbying is as much a part of Brussels cuisine as sauce funds are to fine cuisine. But too many cooks spoil the broth, and that also applies to lobbying. The gravy fund can become bitter.

As with the Fit for 55 package. Pascal Canfin, Chairman of the ENVI Committee in the European Parliament, currently speaks of a “tsunami of lobbyists”. Eight legislative proposals from the Commission’s climate change package are scheduled to be voted on in plenary next week. “This will be the biggest piece of legislation ever passed on the same day in the EP,” says Canfin, a close confidant of Emmanuel Macron.

So the stakes are high. The “disruptive” power of proposed legislation, to use a common expression today, is taken seriously enough by the corporate world to send its lobbyists to the Brussels front. According to Transparency International, there are at least 48,000 people working in Brussels who have made influencing EU institutions and decisions their profession. 7,500 of them hold a lobbyist card accredited to the European Parliament. This means they have direct access to MEPs. The voluntary EU lobby register lists around 12,000 organizations, with a total annual budget of €1.8 billion.

Bas Eickhout, vice chairman of the Environment Committee, confirms Canfin’s experience. Everyone is still in agreement when it comes to setting climate targets, says the Green MEP. “The problem starts when it comes to legislation for individual sectors, like the automotive sector, the energy sector, the financial sector and so on.” Then the lobbyists come up with their proposals to slow down the ongoing process or to argue with the financial burden for their particular sector, the Dutchman says. “It’s the old man’s world.”

Heat wave reminds of urgency

His colleague from the S&D Group, Mohammed Chahim, is very direct about this: “We see CEOs announcing their commitments against global warming at every COP, but at the same time they complain as soon as something actually needs to be changed.” Chahim points out that initiatives to create a climate club – a forum valued by the private sector – cannot hide the fact that a climate club already exists, and that is the UNFCCC. And indeed, at the same time as the plenary session in Strasbourg, the next working session of the UNFCCC begins in Bonn, the seat of the UN institution, called the “Intersession.”

This session is for climate ambassadors from around the world to meet and pave the way for the next world climate conference in Egypt in the fall. There is no doubt that the negotiations there will be as tough as those in Strasbourg, as the urgency can no longer be ignored. At this point, it is worth recalling that New Delhi, northern India, and Pakistan are being crushed by a heat wave that is exceptional for its duration and early timing: it began on March 11, normally a temperate month that marks the end of winter and the beginning of summer.

March and April 2022 were the hottest months on record in northwest Indiana since records began 122 years ago. May continued with historic highs and June will not get any better. Forecasters expect the extreme temperatures to continue until the onset of the monsoon in late June or early July.

Water shortage in France likely

Europe is not spared either. Spain, Portugal, and France are struggling with a drought that is affecting agricultural production – and heralding an imminent battle for water. In France, the Ministry of Ecological Transition recently published a map showing that from the north of the country to Corsica, no area is safe from water shortages this summer.

Another bad omen is that the prefects have already issued 51 decrees restricting the use of water resources in 16 departments. A total of seventy-six areas have been placed on first alert and twenty-six on enhanced alert, compared to six and two areas, respectively, at the same time in 2021.

And that’s not all. In its latest report, the World Meteorological Organization (WMO) warns that four key markers of climate change broke new records in 2021: Greenhouse gas concentrations, sea level rise, temperature and ocean acidification. “Our climate is changing before our eyes,” said WMO head Petteri Taalas.

The link to lobbying? “Each sector looks through its own glasses and defends its own interests, mainly financial,” says Pascal Canfin. “If you added up all the lobbyists’ demands, we wouldn’t be on track for 1.5 degrees, we’d be plus 30 degrees.”

EUROPE.TABLE EDITORS

Till
Hoppe

Charlotte
Wirth

Falk
Steiner

Timo
Landenberger

Corinna
Visser

Lukas
Knigge

Eric
Bonse

Sarah
Schaefer

Manuel
Berkel

Lisa-Martina
Klein

Markus
Grabitz

Stephan
Israel

Claire
Stam

Dear reader,

Hungary’s head of government Viktor Orbán got his way: Patriarch Kirill is no longer on the sanctions list. As a result, the sixth package of sanctions against Russia, including a partial embargo on oil, is expected to enter into force today, Friday, if no other country lodges an objection by 9 am.

Although an embargo also against Russian gas is not far-fetched, only very few EU countries have so far concluded solidarity agreements with their neighbors for gas supplies. Exactly five of these agreements exist, and this is despite the fact that the SoS Regulation has provided for them for every country since 2018 at the latest. It is and remains questionable whether the EU member states would be prepared for a complete loss of Russian gas supplies, writes Manuel Berkel in his Feature.

Blockchains are databases that can only be changed by adding further data; nothing can be deleted. This makes them very powerful and inherently transparent tools, but poses huge challenges for the EU. After all, if it wants to make the technology usable and compatible with its values, sooner or later it will have to find a way to saturate blockchains in a way that complies with data protection laws. Jürgen Geuter has taken a look at the EU’s blockchain strategy.

There is a change of personnel at Germany’s Permanent Representation to the EU. Deputy Ambassador Susanne Szech-Koundouros, who among other roles represented the German government in Coreper I over the course of four years, is giving up her post and returning to Berlin. Read about who will succeed her in the News.

I wish you a nice long Pentecost weekend!

Your
Lisa-Martina Klein

Member states drag out gas agreement

In the current gas crisis, EU bodies repeatedly invoke the unity of member states. In fact, national governments have so far done little to stand by each other in an emergency, as an overview by the European Commission shows.

Before the member states can support each other in the event of a gas embargo, technical, legal and financial details must first be settled. To do this, each EU member would actually have to conclude so-called solidarity agreements with each of its neighboring countries. A corresponding deadline from the SoS Regulation, which came into force in October 2017, expired long before the current crisis, namely in December 2018. The 27 governments have largely ignored this hint.

The Commission currently has only five agreements on its website – the first from December 2020, two years after the obligation to transpose expired. The German government concluded it with Denmark at the time, followed a year later by an agreement with Austria. The other three agreements all date from recent months. The most recent was concluded between Estonia and Finland on April 25 – a few days after Russia cut off gas to the Finns. A pipeline from Estonia can now be used to provide a replacement.

Even if agreements can apparently be concluded quickly in the case of embargoes against individual states, the question is whether the EU27 is sufficiently prepared for a complete breakdown of Russian supplies. Despite long negotiations with its remaining neighbors, Germany has still not been able to agree on further agreements.

Negotiations with Germany’s neighbors stall

At the end of March, the German Ministry of Economics had stated that a signature with Italy was imminent, and negotiations with Poland and the Czech Republic were well advanced. With France, Belgium, Luxembourg and the Netherlands, there was an “exchange” that was being deepened, as was stated at the time. Since then, there have been no concrete conclusions. Negotiations are still ongoing, a spokeswoman for the BMWK told Europe.Table on Thursday.

Given the widespread hesitation among member states, the Commission has been trying to take precautions for a while now. After gas prices began to rise last fall, it included a special standard form in Annex II of the internal gas market package of mid-December for those states that have not concluded solidarity agreements. A ten-page Word template is now to serve as a solidarity request if EU states find themselves without sufficient gas.

Other articles for the amendment of the Gas Market Regulation include joint procurement of strategic stocks and the joint use of storage facilities. They are likely to become particularly important from 2026, when the rules of the Gas Storage Regulation of mid-May expire. Between June 17 and 24, the lead MEPs Jens Geier (S&D) and Jerzy Buzek (EPP) want to finalize their reports on the gas market package.

In addition to the joint use of the existing gas infrastructure, however, new investments are also needed to manage without Russian gas. Possible projects had been identified by European transmission system operators. In Annex 3 to REPowerEU, the Commission cited calculations by ENTSOG in mid-May that Germany, for example, needed even better connections to the Western European network in addition to two LNG terminals of its own. “LNG will play an important role for Europe, landing especially in the west of Europe,” confirmed the association of German network operators, FNB Gas, when asked.

Belgium plans better connection to LNG terminal

ENTSOG’s wish list includes a so-called deodorization plant on the French-German border, which could be used to remove the odorous substances added in France from the gas so that it can be fed into the German grid.

However, the Economics Ministry denies that better connections to the Western European network would make the construction of more LNG terminals on the German coasts unnecessary. “It cannot be assumed that an expansion of pipeline capacities to Belgium will make terminals unnecessary; the important thing is that we still have room for ‘reserve volumes‘ here. The same applies with regard to the construction of a deodorization plant on the border with France,” said the ministry’s spokeswoman.

In Belgium, planning is already at an advanced stage. The infrastructure company Fluxys is planning a better connection to the LNG terminal in Zeebrugge. A 48-kilometer connecting pipeline on the Belgian side could increase export capacity to Germany by 6.2 billion cubic meters (bcm) per year, a company spokesman explains. An investment decision is expected to be made by the end of July. Through an accelerated permitting process, Fluxys hopes to have the facility up and running by the end of 2023 or early 2024. In addition, the Zeebrugge LNG terminal plans to gradually increase its capacity by 2026.

Berlin sees threat to security of supply

The situation in France is more complicated. The Republic is the only neighboring German country that already odorizes its gas in the transport networks and not only in the regional distribution networks. Years ago, the French network operator brought up the idea of building a deodorization plant so that more gas could be piped to Germany. However, due to a lack of interest from market participants, this project was scrapped in 2019, a GRTgaz spokeswoman explained when asked. At the current time, there is also no new confirmed plan.

The network operator on the Baden-Württemberg side also denies new investments: “terranets bw is not planning to build new interconnectors to the French gas network or a deodorization plant. Rather, optimal use or, if necessary, technical additions to the existing border crossing points are being considered.”

In the meantime, however, the problem is also occupying Berlin. “Thus, the different odorization practices between the member states represent an obstacle to the cross-border flow of gas, which leads to a threat to European supply security, especially in times of crisis. The German government is aware of this problem and is in exchange with the French government to find a solution,” the spokeswoman of the Ministry of Economics announced.

Federal government demands technical conversions from EU states

Instead of relying on the construction of expensive infrastructure in Germany, Berlin apparently prefers to persuade Paris to make technical changes to the gas network. “However, a single deodorization plant at the border is not suitable for ensuring an unhindered gas flow throughout Europe. Rather, it can only remove the restriction on cross-border gas flow selectively between two member states. It therefore seems more sensible to standardize the practice by waiving odorization at the transmission level as a whole in the EU.”

This requirement could affect other EU countries besides France. As can be seen from an overview by Marcogaz, odorization in the transmission network exists primarily in Spain and Ireland, but also in Portugal, Italy, Greece, and Romania.

The Ministry of Economics bases its demand on a network code for the interoperability of European gas networks: “If no agreement is reached in the procedure provided for therein, the final consequence is to switch to non-odorized gas in the transmission network.”

What’s wrong with the EU’s blockchain strategy?

Under the impression of the financial crisis, an unknown author under the pseudonym “Satoshi Nakamoto” wrote the so-called “Bitcoin Whitepaper” in 2008, in which he described the idea of a decentralized database that could only be changed by appending it, based on established technologies and processes: blockchains were born. A good 13 years, several crashes and crises later, the EU presents its “Blockchain Strategy”. With this, it hopes to promote blockchains as future technology and strategic asset to help the EU become a leader in this sector.

Blockchains are repeatedly criticized not only because of the enormous energy consumption of the two large chains Bitcoin and Ethereum: The high number of dubious and unregulated speculative transactions that characterize the blockchain sector today also illustrate a clear need for regulation. How does the EU’s blockchain strategy position itself here and does it live up to the goals and values the EU has set for itself?

The Blockchain Strategy defines five core elements necessary for blockchains to comply with EU values and rules:

Sustainability with regard to the environment and resources
Compliance with data protection legislation
Digital identity management
Cybersecurity
Interoperability

The last two points are the easiest to implement – without being trivial: with the use of established cryptographic procedures and the use and establishment of data format standards, these two aspects are more in the realm of hard work. Both are very time-consuming, but the necessary technical competencies can easily be found within the EU.

Nevertheless, blockchains, with their immutability, pose new challenges for cybersecurity that other database technologies do not: in an instance of doubt, the vulnerable code segments are visible to all attackers on the chain, and closing security gaps is often technically more complex than in traditional systems. On the other hand, there are various established solutions in the area of blockchain interoperability on which specific projects can be based.

The other questions, however, are more difficult. For example, there are various blockchains that work with less energy-intensive consensus systems than Bitcoin and Ethereum. However, many of them are so-called “level 2” chains, which are nevertheless anchored in Ethereum, for example, and cannot function without this system and its energy consumption. As decentralized databases that assume to be operated on as many participating computers as possible, blockchains are by definition always more energy-intensive to operate than comparable other database systems. The constantly growing volumes of data, which can never be cleaned up, also lead to significant resource consumption of hard disks.

And there are also structural challenges in the area of compliance with data protection laws: the GDPR grants individuals the right to erasure (Article 17) of information concerning them. Blockchains, however, do not allow this deletion by definition. This makes blockchains fundamentally unsuitable for processing personal or personally identifiable data, which significantly limits their utility for many domains. The strategy talks about blockchains should be compatible with applicable law, but with the GDPR at a fundamental rights level, this soft wording in the strategy does not quite do justice to the regulatory reality.

The idea that individuals should manage their digital identities in a self-sovereign manner, as addressed in point 3, is a popular topos at both federal and EU level right now. However, the reality of existing blockchain systems and the widespread phishing attacks there show that this idea requires an extremely high level of technical competence and time investment from citizens, which is likely to be a major challenge when scaled across the EU.

Tension hardly solvable

The blockchain strategy is intended to boost the European blockchain sector through massive funding programs and the establishment of a pan-European service blockchain with a reference character. The strategy explicitly mentions the promotion of blockchains for the realization of sustainability goals. However, how a decentralized database is supposed to help combat the climate crisis remains completely in the dark.

On the other hand, the will to create legal clarity within the domain is welcome: There are various open construction sites here, especially for the areas of liability, copyright, data protection, and consumer protection. It is very necessary that the EU actively intervenes here and clarifies its legal framework in its application to blockchains.

The EU’s blockchain strategy attempts to capture a technology that is currently in the headlines primarily due to speculative hypes and to make it usable within the framework of EU values. However, the description of the five core requirements already shows how much the characteristics of the technology to be promoted and the goals and values of the EU are often in an almost unresolvable tension. What comes as no surprise to anyone familiar with the history of blockchains: they were explicitly designed to prevent state intervention. The EU’s strategy so far does not convey how it plans to resolve this original contradiction. By Jürgen Geuter

Renewed agreement on sanctions package

EU states waive sanctions against Patriarch Kirill for the time being. Under pressure from Hungary, EU ambassadors took the head of the Russian Orthodox Church off the list to pave the way for the sixth sanctions package against Moscow, diplomats confirmed. The package, including a partial oil embargo, is now due to come into force today unless another member state objects by 9 am.

Hungary’s head of government Viktor Orbán had held up the adoption of the new round of sanctions for four weeks. At Monday’s extraordinary EU summit, leaders agreed politically to halt imports of Russian oil by sea after a transition period. But Orbán followed up on Wednesday, to the annoyance of other governments, by calling for Patriarch Kirill to be removed from the sanctions list.

To enable the necessary unanimity, the other 26 member states accepted the demand. They wanted Kirill to be sanctioned because the 75-year-old maintains close contact with President Vladimir Putin and repeatedly backed his war against Ukraine in his sermons. Orbán justified his stance, saying the freedom of belief of Hungarian religious communities is “sacred and inalienable.” In Brussels, however, it is pointed out that there are only a few thousand Orthodox believers in Hungary, and only a part of them belong to the Orthodox community that professes allegiance to the Patriarchate of Moscow.

Insurance ban threatens

Under the new sanctions package, no more oil will be allowed into the EU by ship next year. However, Hungary, Slovakia and the Czech Republic will be allowed to import Russian oil via the Druzhbba pipeline until further notice because of their high dependence.

In addition, Russia’s largest bank, Sberbank, will be excluded from the Swift financial communications network and several Russian news channels will be banned in the EU. European firms will also be banned from offering services such as auditing or tax advice to Russian companies. The President of the European Parliament, Roberta Metsola, also announced a ban on all representatives of Russian companies.

Far more consequential for Russia would be the EU and UK’s planned ban on insuring tankers with Russian oil on board. As London is by far the most important location for this type of insurance, this would severely curtail Russia’s ability to supply its oil to other customers such as China or India. A joint ban is also being discussed at the G7 level. tho/dpa

Von der Leyen: Poland gets funds only against judicial reform

The EU Commission is taking a new approach to the planned disbursement of financial aid from the COVID-19 reconstruction fund to Poland. In contrast to previous practice, the billions of euros in aid – €23.9 billion in grants and an additional €11.5 billion in loans – will not only be tied to economic policy “milestones. Poland is also to fulfill legal policy conditions.

They are intended to promote the “independence of the legal system” in Poland, according to the EU Commission. By the end of the 2nd quarter – i.e. by the end of June – the controversial disciplinary chamber for judges must be dissolved and replaced by a new system (milestone 1). In addition, the proceedings for judges who have already been dismissed are to be reopened (milestone 2).

In a third step (milestone 3), the Brussels authority then wants to check whether all reforms have been implemented as agreed. However, this is not due to take place until the end of 2024. By then, around half of the billions in aid should have been paid out. The second half could even be paid out by August 2026 without any legal requirements.

“Money for reforms” is then also the new motto in Brussels. “First the milestones have to be reached, then the money will be paid out,” said head of the authorities Ursula von der Leyen on Thursday during a visit to Warsaw. At the same time, she made clear: “We are not yet at the end of the road as far as the rule of law in Poland is concerned.”

Poland acts “reluctantly”

However, the EU Commission has not been consistent in disbursing the money against reforms. Although several commissioners – including the “executive” vice presidents Frans Timmermans and Margrete Vestager – have raised concerns, von der Leyen has shown herself generously.

The conditions for payment, which it formulated as recently as October 2021, have been noticeably relaxed. There is no longer any talk of reinstating the dismissed judges. The authority is also quite relaxed about the penalties Poland will have to pay in the dispute over the judicial system. Von der Leyen nevertheless stressed at Thursday’s press conference that the disciplinary regime as a whole must also be reformed. For example, judges already affected by decisions of the disciplinary chamber would have to be able to have that decision reviewed. Poland’s Prime Minister Mateusz Morawiecki countered, “It’s in our interest that all judges are maximally independent and non-partisan.”

In October 2021, the European Court of Justice ordered the country to pay a penalty of €1 million per day. However, the government in Warsaw is not paying. The EU Commission has therefore moved to offset the fine against other payments to Poland. The country is behaving “reluctantly,” said a Commission expert, but that does not stand in the way of an agreement. Generously, they also overlook the fact that Poland still claims primacy of its national law over EU law. That is a rather theoretical dispute, they say, now it is a matter of practical solutions.

Von der Leyen wanted to announce exactly what these will look like on Thursday afternoon in Warsaw. In addition to the rule of law, the war in Ukraine is also likely to be on the agenda. Since aid for Ukraine-EU diplomats in Brussels suspect-is ultimately more important than the pesky details of Polish judicial reform. ebo

Change in German EU representation

Change in the Permanent Representation of Germany to the EU: the previous Vice Ambassador Susanne Szech-Koundouros will return to Berlin in the summer and will be succeeded by Helen Winter, according to Europe.Table. The Ministerialdirigentin currently still works in the Federal Chancellery, as a group leader for national and international economic policy. She is regarded as a highly reputable civil servant.

Szech-Koundouros had served as Ambassador Michael Clauß‘s deputy for four years and represented the German government in Coreper I, the committee of permanent representatives of the member states in which economic issues are discussed. That the traffic light government is bringing her back is not surprising: the 60-year-old is close to the CDU/CSU, she worked for the CDU/CSU parliamentary group in the Bundestag before moving to Brussels. The official comes from the Federal Ministry of Economics and is likely to return there.

Clauß, on the other hand, will probably remain in office. The diplomat has no party political affiliations and is held in high esteem. In the wake of the COVID-19 pandemic and the Ukraine war, the Permanent Representatives have gained a great deal of political weight in the EU decision-making process; for example, they negotiate the sanctions packages against Russia. Clauß, previously ambassador in Beijing, moved to Brussels four years ago and has earned a reputation there as an excellent expert. tho

Charging infrastructure: transport Council reaches agreement

The transport ministers of the 27 EU member states have agreed on their position on the development of alternative fuel charging infrastructure (AFIR). At the Transport Council on Thursday, the compromise for the General Approach negotiated by the French Council Presidency met with broad approval.

The compromise is largely based on the Commission’s proposal, but it gives the member states more flexibility in expanding the charging infrastructure and takes greater account of the individual technical starting situations of the individual countries. This applies in particular to the expansion of the electric charging infrastructure for heavy-duty vehicles.

By the end of 2025, publicly accessible charging stations for heavy-duty vehicles are to be installed on at least 15 percent of the length of the TEN-T network in each direction of travel. By the end of 2037, charging stations are to be installed on at least 40 percent of the TEN-T network. This is intended to give the countries more individual freedom in terms of expansion.

In its proposal, the Commission had specified distances, which the Council also adopted. In the core of the TEN-T network, for example, there should be a maximum of 60 kilometers between charging stations, and in the extended TEN-T network a maximum of 100 kilometers.

Wissing wanted higher targets

Despite the approval, there was also criticism. The Czech Republic criticized that technical developments in heavy-duty transport for alternative fuels were difficult to predict. Bulgaria also announced that it would not accept any increases in the infrastructure development targets for heavy goods vehicles in the trilogue.

Although Germany, Denmark, and Austria declared their agreement in the sense of a compromise, they went on record saying they would have preferred more ambitious expansion targets for both light and heavy commercial vehicles. For heavy commercial vehicles, in particular, German Transport Minister Volker Wissing would have liked to see a faster ramp-up of charging options from 2025, he said Thursday at the Transport Council in Luxembourg. luk

Hungary threatens trouble with Commission over fuel regulation

Hungary is threatened with trouble from the EU Commission because of discrimination against foreigners at gas stations. A spokeswoman for the Brussels authority confirmed on Thursday that new regulation in force since Friday is currently being examined. It stipulates that owners of vehicles with foreign license plates may no longer benefit from state subsidies.

According to the spokeswoman, Hungary could violate EU rules prohibiting discrimination against consumers on the basis of nationality or residence with the regulation. Restrictions on the internal market can only be justified by compelling reasons, said the spokeswoman. These could concern public order, health, or safety, for example. “They cannot be justified on economic grounds,” said the spokeswoman.

If the Brussels authority concludes in its investigation that Budapest is in breach of EU law, it could initiate so-called infringement proceedings against Hungary. The end result could be a complaint to the European Court of Justice and a fine. The spokeswoman said they learned about the measure from the media.

The fact that foreign motorists are no longer allowed to benefit from the state fuel discount means that they currently have to pay significantly more money for a liter of gas at the pumps. According to media reports, the price is on average 40 percent higher than for Hungarian citizens. dpa

What’s cooking in Brussels

From Claire Stam

Lobbying is as much a part of Brussels cuisine as sauce funds are to fine cuisine. But too many cooks spoil the broth, and that also applies to lobbying. The gravy fund can become bitter.

As with the Fit for 55 package. Pascal Canfin, Chairman of the ENVI Committee in the European Parliament, currently speaks of a “tsunami of lobbyists”. Eight legislative proposals from the Commission’s climate change package are scheduled to be voted on in plenary next week. “This will be the biggest piece of legislation ever passed on the same day in the EP,” says Canfin, a close confidant of Emmanuel Macron.

So the stakes are high. The “disruptive” power of proposed legislation, to use a common expression today, is taken seriously enough by the corporate world to send its lobbyists to the Brussels front. According to Transparency International, there are at least 48,000 people working in Brussels who have made influencing EU institutions and decisions their profession. 7,500 of them hold a lobbyist card accredited to the European Parliament. This means they have direct access to MEPs. The voluntary EU lobby register lists around 12,000 organizations, with a total annual budget of €1.8 billion.

Bas Eickhout, vice chairman of the Environment Committee, confirms Canfin’s experience. Everyone is still in agreement when it comes to setting climate targets, says the Green MEP. “The problem starts when it comes to legislation for individual sectors, like the automotive sector, the energy sector, the financial sector and so on.” Then the lobbyists come up with their proposals to slow down the ongoing process or to argue with the financial burden for their particular sector, the Dutchman says. “It’s the old man’s world.”

Heat wave reminds of urgency

His colleague from the S&D Group, Mohammed Chahim, is very direct about this: “We see CEOs announcing their commitments against global warming at every COP, but at the same time they complain as soon as something actually needs to be changed.” Chahim points out that initiatives to create a climate club – a forum valued by the private sector – cannot hide the fact that a climate club already exists, and that is the UNFCCC. And indeed, at the same time as the plenary session in Strasbourg, the next working session of the UNFCCC begins in Bonn, the seat of the UN institution, called the “Intersession.”

This session is for climate ambassadors from around the world to meet and pave the way for the next world climate conference in Egypt in the fall. There is no doubt that the negotiations there will be as tough as those in Strasbourg, as the urgency can no longer be ignored. At this point, it is worth recalling that New Delhi, northern India, and Pakistan are being crushed by a heat wave that is exceptional for its duration and early timing: it began on March 11, normally a temperate month that marks the end of winter and the beginning of summer.

March and April 2022 were the hottest months on record in northwest Indiana since records began 122 years ago. May continued with historic highs and June will not get any better. Forecasters expect the extreme temperatures to continue until the onset of the monsoon in late June or early July.

Water shortage in France likely

Europe is not spared either. Spain, Portugal, and France are struggling with a drought that is affecting agricultural production – and heralding an imminent battle for water. In France, the Ministry of Ecological Transition recently published a map showing that from the north of the country to Corsica, no area is safe from water shortages this summer.

Another bad omen is that the prefects have already issued 51 decrees restricting the use of water resources in 16 departments. A total of seventy-six areas have been placed on first alert and twenty-six on enhanced alert, compared to six and two areas, respectively, at the same time in 2021.

And that’s not all. In its latest report, the World Meteorological Organization (WMO) warns that four key markers of climate change broke new records in 2021: Greenhouse gas concentrations, sea level rise, temperature and ocean acidification. “Our climate is changing before our eyes,” said WMO head Petteri Taalas.

The link to lobbying? “Each sector looks through its own glasses and defends its own interests, mainly financial,” says Pascal Canfin. “If you added up all the lobbyists’ demands, we wouldn’t be on track for 1.5 degrees, we’d be plus 30 degrees.”