Gas and electricity could become scarce and very expensive commodities in winter. European leaders are therefore already pledging solidarity. From many member states’ points of view, however, this also includes Germany keeping its remaining three nuclear power plants on the grid beyond the end of the year. Yesterday, the Wall Street Journal reported that the German government wants to postpone the shutdown. Federal Economic Affairs Minister Robert Habeck (Greens) issued a harsh denial, saying the report lacked “any factual basis”. Nevertheless, there are many indications that the coalition is laying the foundation for the politically sensitive decision.
The Baltic countries have already implemented their decision to withdraw from the former 16+1 format with China. Does this now mean the collapse of the cooperation format? Probably not, according to Amelie Richter. It is true that other countries could follow the Baltic states’ example. But key candidates still benefit too much from China to make leaving worthwhile.
The Open RAN initiative generated high expectations. It was supposed to provide independence from China in the telecommunications sector and, even more importantly, security. But scientists now warn that the threat of dependence on China in mobile communications technology still remains. Falk Steiner took a closer look at the paper.
The German Mechanical Engineering Industry Association (VDMA) has serious reservations about the CSR Directive, which will impose new sustainability reporting obligations on SMEs. In today’s Opinion, VDMA expert Sarah Brückner calls for the reporting requirements to be streamlined. Otherwise, it is not the environment that ultimately stands to benefit from the Brussels plans – but the consulting industry, through a guaranteed increase in contracts.
I wish you an exciting read.
The proposal sounded promising: A major power wants to channel money into Central and Eastern European states, develop infrastructure, revive old factories, and invest in people and local projects that are unable to attract Western investors. The 16+1 format appeared on the scene and a race to become “China’s gateway to Europe” began. For some participants, however, the finish line never came in sight, and economic hopes remained unfulfilled. There are no fireworks to mark the tenth anniversary of its founding. Instead, the cooperation format continues to shrink with the withdrawal of Latvia and Estonia.
In 2012, the “Cooperation between China and Central and Eastern European Countries”, or China-CEEC, was formed. It included 16 countries in Central and Eastern Europe and the People’s Republic. After Greece joined, it was given the unofficial name 17+1. In 2021, Lithuania took the first step, left the cooperation format, and changed its name back to 16+1.
Since last week, the numbers have to be re-counted again. With the coordinated withdrawal of the Baltic EU states Estonia and Latvia, there are now only 14+1 left. The remaining 14 consist of the 9 EU member states Bulgaria, Greece, Croatia, Poland, Romania, Slovenia, Slovakia, Czech Republic and Hungary. In addition, there are the Five Western Balkan states of Albania, Bosnia and Herzegovina, Serbia, Montenegro and North Macedonia.
The withdrawal is unsurprising, says Liisi Karindi, an analyst at the think tank China Observers in Central and Eastern Europe (CHOICE). In her home country of Estonia, she says, China has long ceased to be perceived as an economic opportunity and has become more of a national security issue. “Politically and economically, China has never been that important to us,” Karindi tells China.Table.
Estonia, just like Lithuania and Latvia, is more at the bottom of the list of recipients of Chinese investments. And according to the United Nations Comtrade database on international trade, Estonian exports to China amounted to just $232 million in 2021.
Much more important and present in Estonian public perception is another major power, Karindi said. “For us in the Baltics, the question is always, what is Russia doing?” Because of the proximity, “sides had to be chosen pretty quickly”. The choice fell on the United States and NATO. The Russian attack on Ukraine and China’s reaction was also decisive for Estonia’s decision to leave the cooperation format. The possible damage to relations with China due to the withdrawal is “collateral damage,” says Karindi. The point was to take a clear stand against China’s role in the Ukraine war and against human rights violations.
Latvia issued a similar announcement to Estonia last Thursday and announced its withdrawal. Just the day before, there had been talks about a possible expansion of cooperation in the transport sector.
What was surprising is the lack of a reaction from Beijing. Neither at the weekend nor at the beginning of the new week was there any official comment on the Baltic states’ withdrawal. A year ago, Lithuania caused a much bigger stir. Because after the withdrawal from the format, Vilnius immediately also initiated a rapprochement with Taiwan. The announcement of plans to set up a “Taiwan office” in the Lithuanian capital was the starting point of an unprecedented downfall of diplomatic and economic relations. Analyst Karindi does not believe that Estonia could now face a similar fate. There were currently no concrete plans on the part of the government to set up a “Taiwan office” in the country.
Is the Baltic exit now the beginning of a major wave of exits from CEEC-China? Probably not. The composition of its members is too heterogeneous for that – too many different interests in different states. Latvia, Lithuania and Estonia do not serve as a model for states such as Serbia or Montenegro when it comes to relations with China. For the Western Balkan states, Chinese offers are still financially interesting and will remain so because the EU’s presence is too small.
The end of 14+1 will only be ushered in when one of the leading heavyweights such as Hungary, Poland, Romania or the Czech Republic leaves the fold. Hungary, however, will now be the site of a new battery factory by CATL. The size of the investment: €7.34 billion (China.Table reported). The fact that this was announced just the day after Latvia and Estonia announced their withdrawal was read by some observers as an indirect reaction to the Baltic exit.
Poland and Romania are growing increasingly skeptical about Chinese investment. In Romania, all Chinese projects have been frozen. In 2020, the Romanians broke off talks with the Chinese about the Cernavoda nuclear power plant after seven years of negotiations. In Poland, the biggest project is the freight railroad running along the Land Silk Road from China. Trains continued to run there despite problems in 2021 on the Polish-Belarusian border and now during the Russian war in Ukraine. The biggest economic problem between Poland and the People’s Republic is the trade deficit. However, skepticism toward China does not seem to be pushing the governments in Warsaw and Bucharest to leave the cooperation format at this time.
The most likely candidate for withdrawal is the Czech Republic. Here, the question is not if, but when the step will be taken, as Ivana Karásková, China Research Fellow at the Association for International Affairs (AMO) in Prague, writes. Since the new Prime Minister Petr Fiala took office, the Czech Republic has been making more critical statements about China. Czech Foreign Minister Jan Lipavský is in favor of closer ties with Taiwan. In addition, the Foreign Ministry echoed the assessment that the format has brought the Czech Republic virtually no benefits over a decade of membership.
The Foreign Affairs Committee of the Czech Chamber of Deputies has already specifically called for withdrawal in a resolution. However, the Czech Republic still has to get rid of one “hurdle”: President Miloš Zeman. Zeman is Beijing’s champion. He personally attended the CEEC-China summit last year online. Since Zeman will not be allowed to run for re-election in January, the Czech Republic is expected to leave 14+1 next year.
In Berlin, there has long been resistance to prescribing explicit savings measures for energy consumption that would also interfere with the everyday lives of citizens and industry processes. The German government’s main focus on gas storage to reduce Germany’s energy dependence on Russia was recently criticized by energy experts as “inappropriate” (Europe.Table reported). Despite full storage levels, rapid measures are needed to reduce gas consumption.
Now, with two proposed ordinances for reducing gas and electricity consumption, there are for the first time concrete ideas on how to achieve the savings targets of 15 percent on average prescribed by the EU. They have been submitted by the Federal Ministry of Economic Affairs and Climate Action (BMWK), are currently being coordinated within the federal government, and are due to come into force on September 1, according to government sources.
However, some proposals are not so much strict savings measures as legal flexibilities that could encourage energy saving. Lowering the minimum temperatures in rented rooms only saves energy if tenants voluntarily heat less. The same applies to lowering the minimum temperature in the workplace to 19 degrees. Whether savings actually take place as a result is not in the hands of the legislator.
The situation is different with the ban on heating private pools and the ban on instantaneous water heaters for sinks in public properties. The lighting of buildings or monuments as well as advertising installations is also to be switched off on a mandatory basis. These are by all means strict cost-cutting measures. In some countries, however, the government is going even further in its efforts to reduce energy consumption. In others, however, the savings already achieved are being maintained.
Where Germany merely gives employers leeway to heat less, Spain is getting serious. Public buildings as well as train stations, airports, cultural institutions, but also hotels, department stores, and offices may now only be cooled to a maximum of 27 degrees and heated to a maximum of 19 degrees.
In addition to the public sector, employees in the private sector are now also encouraged to work from home. At night, unused offices, as well as shop windows and monuments, must also switch off their lighting.
For the time being, the regulations will apply until the end of October 2023. It is true that enormously high penalties and fines are possible in the event of non-compliance. However, the largely autonomous regions of Spain are responsible for implementing and imposing penalties. The Balearic Energy Minister Juan Pedro Yllanes, for example, had declared that he would trust the businessmen to implement the rules and would not initially carry out any checks or impose any penalties.
In France, energy is to be saved above all in the workplace. Public authorities, for example, are required not to leave equipment on standby and to cool and heat rooms less. Stores must “systematically reduce their light intensity” after closing time and switch off illuminated advertising. Some supermarkets have announced they will close their doors more consistently when the air conditioning is running. According to Agnès Pannier-Runacher, the French Minister for Ecological Transition, this alone could reduce energy consumption by 20 percent.
The government wants to enforce this for all stores in case of doubt, even with fines of up to €750.
Germany is not the only country to rely on voluntary measures to save energy. In Italy, there are savings targets for heating (maximum 19 degrees) and cooling (minimum 27 degrees) in public offices, however, there are no mandatory measures for the industry. Greece is reducing street lighting to the minimum and banning the cooling of public buildings to less than 27 degrees. So far, however, the country does not want to go any further.
This is similar in the Netherlands, Belgium, and Sweden: There, they hope to convince the population to heat less and take shorter showers through advertising campaigns. The Czech Republic is betting that high energy prices alone will lead to savings among the population.
Finland, Denmark, and Lithuania say they have already achieved their savings targets and see no need for further energy-saving measures. So does Estonia. However, heating suppliers and industry are called upon to save gas and switch to other fuels. In the coming heating period, domestic but climate-damaging oil shale could also partially replace gas.
Similar to Germany, Austria is also relying on coal to save gas. For example, the decommissioned Mellach coal-fired power plant is to be put back into operation if necessary. Additionally, large companies and power plants are to be able to use petroleum as an alternative to gas from the fall onwards, with the state bearing the costs of the conversion. This measure is highly controversial, however, as it is enormously harmful to the climate and does not reduce energy consumption.
Additionally, an energy-saving campaign will be launched in the fall. According to the Energy Ministry, the high prices alone have already ensured that around seven percent less gas was consumed in the first half of the year than in the same period last year.
In addition, of course, there are countries such as Poland and Hungary, which explicitly oppose energy-saving measures and have ruled out implementation of the EU savings target for themselves from the outset.
The example from Japan also shows how one can react to the current energy crisis. In Tokyo, too, the government this summer again called to save electricity for the winter – for the first time since 2011.
At that time, the Fukushima reactor disaster was the reason for collective electricity-saving measures that degenerated into a veritable popular sport – called “setsuden”. Baseball and soccer teams moved their night games to the afternoon to use less lighting. Automaker Nissan changed shift times at its factories to ease the strain on the power grid during peak hours, and supermarkets switched to LED light bulbs and installed solar panels in many stores. And the population also saved electricity wherever possible.
The current government incentives for saving electricity include a points program for companies and consumers. Those who save electricity receive points that are reflected in a bonus on their electricity bill. According to media reports, the Japanese government is making a total of €1.3 billion available for the program.
Other parts of the world are struggling with much more fundamental problems. Pakistan fears a catastrophic winter. The country imports almost all of its energy and is suffering enormously from the increased prices of oil and gas. The result: power cuts and declining economic performance. That is why Pakistan now wants to act, even if it is questionable whether the measures will already have an effect in the coming winter.
Pakistan’s energy system is inefficient and wasteful due to outdated power plant technologies and unimplemented building codes and energy standards, as well as price anomalies that invite waste. Now the government in Islamabad wants to set and enforce minimum thermal efficiency standards for different fuels used in power generation. And it’s also looking to raise awareness among industry about energy-saving and efficiency measures that will make Pakistan’s energy system more resilient in the future.
Hardly any country has as much trouble saving energy as the United States. It is still the country with the highest gas consumption. And yet strict energy-saving measures for consumers or industry have so far failed to materialize. This is also due to the fact that the USA is largely self-sufficient in energy and does not depend on imports.
High gasoline and diesel prices have only resulted in President Joe Biden getting his significantly slimmed-down climate package through both chambers of Congress after much wrangling. However, the $375 billion to be poured into climate protection and the energy transition over ten years is aimed primarily at emissions reductions rather than short-term energy savings.
Canada, too, is only planning long-term solutions to the energy transition that are not motivated by the current energy price crisis but by the climate crisis. These include more energy-efficient buildings and the expansion of renewables. Acutely and triggered by the energy price crisis, Ottawa even wants to expand oil and gas production to supply Europe in the future. With dpa
Actually, the goal is clear: Untrusted hardware and software should not be used in critical infrastructures, especially not in telecommunications infrastructures. The debate about the role of the Chinese supplier Huawei had also arrived in the EU and Germany in 2018, mainly at the instigation of the USA. The fear: The components of the Chinese manufacturers and their software could be used both for espionage and – in the event of confrontation – as a kill switch, i.e., misused to shut down entire network areas.
Particularly in the area of the rollout of 5G networks and subsequent generations, there has therefore been a hectic political search for solutions as to how a clear preference can be placed on other providers, above all the European equipment suppliers Nokia and Ericsson. At the same time, Chinese providers should not be subject to legal market exclusion. The EU then published its so-called 5G toolbox, and in Germany, the IT Security Act and the BSI Act were amended.
The core of the political debates: Whereas in the past, it was primarily the distribution network between stations and the providers’ backbone lines that were considered critical since the Huawei debate, and with 5G, the focus has increasingly been on the endpoints of the mobile network. This is because 5G gives them a larger and more active role. The RAN is the mobile network area that establishes the radio link to the end users and connects antennas and hardware at the radio tower with the core network of the providers. One idea for ensuring greater security there: Open RAN – a system of predefined, standardized radio network components and software.
With interoperable individual elements, Open RAN is intended to enable security and interchangeability – without blanket exclusion of certain manufacturers. German and European mobile communications companies, therefore, see Open RAN as a way of minimizing risks. On the other hand, however, the fact that completely different providers can be used should keep costs low. Chinese providers jumped on the allegedly open concept early on and have been supporting it intensively ever since.
In a recently published paper (PDF) by the Digital Power China research consortium, authors Jan-Peter Kleinhans and Tim Rühlig warn against credulity in connection with Open RAN. They say a very precise distinction must be made between what is meant by Open RAN in the first place – and which actors with which interests were involved in the Open RAN definitions. “At least 16 members of the O-RAN Alliance have ties to the Chinese security apparatus,” the paper says, adding that all three of the People’s Republic’s state-owned mobile operators are also involved.
China Mobile, in particular, is problematic as a founding member because it co-chairs ten working groups and is represented on the supervisory board and management board. In addition, China Mobile is a member of the technical steering committee, which decides on technological matters even before publication. The EU Commission and the German government are also warning with increasing intensity of the threat of Chinese players having too much power in such standardization bodies.
The authors see another major problem in the fact that Open RAN committees specify not only hardware but also software. Even if the source code is open, the sheer volume of RAN code is almost impossible to check.
The authors warn against narrowing the debate to Huawei alone – it is about China. Overall, the O-RAN Alliance is “anything but a trustworthy partner”. It is “highly questionable whether cooperation within and use of O-RAN Alliance-compatible equipment can effectively address the issues that are surfacing around Huawei’s role in the 5G rollout.”
At the beginning of May, the EU Commission published a study on the security of Open RAN, in which the European Network and Information Security Agency (ENISA) was involved. This study also identified significant security risks for Open RAN. According to the study, core risks include the fact that Open RAN is not mature enough in terms of security technology and could increase the attack surface for malicious actors.
The German Federal Office for Information Security (BSI) had already commissioned a study in 2019 to examine security risks posed by Open RAN. At the time, the authors from the Barkhausen Institute and Advancing Individual Networks had concluded that the status at that time “contained multiple security risks”. One of these is particularly relevant: Open RAN had not been designed according to the principles of security by design or security by default; building security into standards after the fact was extremely difficult.
Sometimes less is more – even in the sustainability sphere. The EU wants to force significantly more companies to report on measures that ensure greater sustainability. To ensure this, the EU is planning another comprehensive set of rules with the CSR Directive.
As good as it sounds on paper – in practice, the CSR Directive, with its many requirements formulated down to minute detail, stands to overburden most small and medium-sized companies. As a result, the only thing it will definitively ensure is a steady stream of gigsfor consultants.The VDMA, therefore, advocates in favor of a risk-based approach kicks in where companies still have influence in order to obtain qualified information.
The European Financial Reporting Advisory Group (EFRAG) has presented first drafts of the reporting requirements. These were available for public comment until last week. The final proposal will be submitted to the Commission before the end of the year. The standards set out in the document would then be adopted directly by the Commission as delegated acts. SMEs in particular can only hope that EFRAG will take the feedback from the consultation into account when revising the proposals. Unfortunately, this is not certain.
In any case, the “less is more” principle is nowhere to be found in EFRAG’s drafts. And this is problematic in several ways: The purposeof good reporting should be to add value for both the reporting organization and the report users.This means defining and prioritizing which information is and isn’t essential and really necessary. If the requirements are too stringent, there is a risk that reporting will focus on compliance rather than adding value to users and report owners The original goal of “preventing greenwashing” could be missed as a result.
Even for companies with many years of experience in the application of international ESG reporting standards, implementation will be accompanied by major challenges. Complicating matters further is the fact that this data should be collected for the entire value chain. For many companies, the supply chain includes thousands of suppliers. For the large number of medium-sized companies that are will be subject to the CSR reporting obligation for the first time, the requirements will not be feasible in this form. Not only do they not have the expertise, they will also not be able to find experts on the market to help them become compliant.
Overall, the disclosure requirements should therefore be significantly limited in terms of content – especially for medium-sized companies. It should also be imperative that European sustainability reporting is aligned with the global minimum standards developed by the International Sustainability Standards Board (ISSB) -a diverging European approach would be counterproductive.
In the previous drafts, we saw a major risk that consulting companies and auditors will primarily profit from the new standards by being able to acquire new lucrative contracts. However, they will not be able to assess the accuracy of the sustainability disclosures, but only the audited process for collecting and monitoring the reporting disclosures.
That is why the VDMA – as the representative of around 3,500 companies in the capital goods industry – is emphatically in favor of streamlining the CSR reporting requirements. The mostly small and medium-sized companies in the mechanical and plant engineering sector often contribute to sustainability with their products, for example when waste is sorted or recycled at the plants. This has tocontinue to be their main task – not creating reports. The focus should be on adding value with CSR reports. Otherwise, John Naisbitt’s wisdom applies: “We are drowning in information and starving for knowledge.”
Gas and electricity could become scarce and very expensive commodities in winter. European leaders are therefore already pledging solidarity. From many member states’ points of view, however, this also includes Germany keeping its remaining three nuclear power plants on the grid beyond the end of the year. Yesterday, the Wall Street Journal reported that the German government wants to postpone the shutdown. Federal Economic Affairs Minister Robert Habeck (Greens) issued a harsh denial, saying the report lacked “any factual basis”. Nevertheless, there are many indications that the coalition is laying the foundation for the politically sensitive decision.
The Baltic countries have already implemented their decision to withdraw from the former 16+1 format with China. Does this now mean the collapse of the cooperation format? Probably not, according to Amelie Richter. It is true that other countries could follow the Baltic states’ example. But key candidates still benefit too much from China to make leaving worthwhile.
The Open RAN initiative generated high expectations. It was supposed to provide independence from China in the telecommunications sector and, even more importantly, security. But scientists now warn that the threat of dependence on China in mobile communications technology still remains. Falk Steiner took a closer look at the paper.
The German Mechanical Engineering Industry Association (VDMA) has serious reservations about the CSR Directive, which will impose new sustainability reporting obligations on SMEs. In today’s Opinion, VDMA expert Sarah Brückner calls for the reporting requirements to be streamlined. Otherwise, it is not the environment that ultimately stands to benefit from the Brussels plans – but the consulting industry, through a guaranteed increase in contracts.
I wish you an exciting read.
The proposal sounded promising: A major power wants to channel money into Central and Eastern European states, develop infrastructure, revive old factories, and invest in people and local projects that are unable to attract Western investors. The 16+1 format appeared on the scene and a race to become “China’s gateway to Europe” began. For some participants, however, the finish line never came in sight, and economic hopes remained unfulfilled. There are no fireworks to mark the tenth anniversary of its founding. Instead, the cooperation format continues to shrink with the withdrawal of Latvia and Estonia.
In 2012, the “Cooperation between China and Central and Eastern European Countries”, or China-CEEC, was formed. It included 16 countries in Central and Eastern Europe and the People’s Republic. After Greece joined, it was given the unofficial name 17+1. In 2021, Lithuania took the first step, left the cooperation format, and changed its name back to 16+1.
Since last week, the numbers have to be re-counted again. With the coordinated withdrawal of the Baltic EU states Estonia and Latvia, there are now only 14+1 left. The remaining 14 consist of the 9 EU member states Bulgaria, Greece, Croatia, Poland, Romania, Slovenia, Slovakia, Czech Republic and Hungary. In addition, there are the Five Western Balkan states of Albania, Bosnia and Herzegovina, Serbia, Montenegro and North Macedonia.
The withdrawal is unsurprising, says Liisi Karindi, an analyst at the think tank China Observers in Central and Eastern Europe (CHOICE). In her home country of Estonia, she says, China has long ceased to be perceived as an economic opportunity and has become more of a national security issue. “Politically and economically, China has never been that important to us,” Karindi tells China.Table.
Estonia, just like Lithuania and Latvia, is more at the bottom of the list of recipients of Chinese investments. And according to the United Nations Comtrade database on international trade, Estonian exports to China amounted to just $232 million in 2021.
Much more important and present in Estonian public perception is another major power, Karindi said. “For us in the Baltics, the question is always, what is Russia doing?” Because of the proximity, “sides had to be chosen pretty quickly”. The choice fell on the United States and NATO. The Russian attack on Ukraine and China’s reaction was also decisive for Estonia’s decision to leave the cooperation format. The possible damage to relations with China due to the withdrawal is “collateral damage,” says Karindi. The point was to take a clear stand against China’s role in the Ukraine war and against human rights violations.
Latvia issued a similar announcement to Estonia last Thursday and announced its withdrawal. Just the day before, there had been talks about a possible expansion of cooperation in the transport sector.
What was surprising is the lack of a reaction from Beijing. Neither at the weekend nor at the beginning of the new week was there any official comment on the Baltic states’ withdrawal. A year ago, Lithuania caused a much bigger stir. Because after the withdrawal from the format, Vilnius immediately also initiated a rapprochement with Taiwan. The announcement of plans to set up a “Taiwan office” in the Lithuanian capital was the starting point of an unprecedented downfall of diplomatic and economic relations. Analyst Karindi does not believe that Estonia could now face a similar fate. There were currently no concrete plans on the part of the government to set up a “Taiwan office” in the country.
Is the Baltic exit now the beginning of a major wave of exits from CEEC-China? Probably not. The composition of its members is too heterogeneous for that – too many different interests in different states. Latvia, Lithuania and Estonia do not serve as a model for states such as Serbia or Montenegro when it comes to relations with China. For the Western Balkan states, Chinese offers are still financially interesting and will remain so because the EU’s presence is too small.
The end of 14+1 will only be ushered in when one of the leading heavyweights such as Hungary, Poland, Romania or the Czech Republic leaves the fold. Hungary, however, will now be the site of a new battery factory by CATL. The size of the investment: €7.34 billion (China.Table reported). The fact that this was announced just the day after Latvia and Estonia announced their withdrawal was read by some observers as an indirect reaction to the Baltic exit.
Poland and Romania are growing increasingly skeptical about Chinese investment. In Romania, all Chinese projects have been frozen. In 2020, the Romanians broke off talks with the Chinese about the Cernavoda nuclear power plant after seven years of negotiations. In Poland, the biggest project is the freight railroad running along the Land Silk Road from China. Trains continued to run there despite problems in 2021 on the Polish-Belarusian border and now during the Russian war in Ukraine. The biggest economic problem between Poland and the People’s Republic is the trade deficit. However, skepticism toward China does not seem to be pushing the governments in Warsaw and Bucharest to leave the cooperation format at this time.
The most likely candidate for withdrawal is the Czech Republic. Here, the question is not if, but when the step will be taken, as Ivana Karásková, China Research Fellow at the Association for International Affairs (AMO) in Prague, writes. Since the new Prime Minister Petr Fiala took office, the Czech Republic has been making more critical statements about China. Czech Foreign Minister Jan Lipavský is in favor of closer ties with Taiwan. In addition, the Foreign Ministry echoed the assessment that the format has brought the Czech Republic virtually no benefits over a decade of membership.
The Foreign Affairs Committee of the Czech Chamber of Deputies has already specifically called for withdrawal in a resolution. However, the Czech Republic still has to get rid of one “hurdle”: President Miloš Zeman. Zeman is Beijing’s champion. He personally attended the CEEC-China summit last year online. Since Zeman will not be allowed to run for re-election in January, the Czech Republic is expected to leave 14+1 next year.
In Berlin, there has long been resistance to prescribing explicit savings measures for energy consumption that would also interfere with the everyday lives of citizens and industry processes. The German government’s main focus on gas storage to reduce Germany’s energy dependence on Russia was recently criticized by energy experts as “inappropriate” (Europe.Table reported). Despite full storage levels, rapid measures are needed to reduce gas consumption.
Now, with two proposed ordinances for reducing gas and electricity consumption, there are for the first time concrete ideas on how to achieve the savings targets of 15 percent on average prescribed by the EU. They have been submitted by the Federal Ministry of Economic Affairs and Climate Action (BMWK), are currently being coordinated within the federal government, and are due to come into force on September 1, according to government sources.
However, some proposals are not so much strict savings measures as legal flexibilities that could encourage energy saving. Lowering the minimum temperatures in rented rooms only saves energy if tenants voluntarily heat less. The same applies to lowering the minimum temperature in the workplace to 19 degrees. Whether savings actually take place as a result is not in the hands of the legislator.
The situation is different with the ban on heating private pools and the ban on instantaneous water heaters for sinks in public properties. The lighting of buildings or monuments as well as advertising installations is also to be switched off on a mandatory basis. These are by all means strict cost-cutting measures. In some countries, however, the government is going even further in its efforts to reduce energy consumption. In others, however, the savings already achieved are being maintained.
Where Germany merely gives employers leeway to heat less, Spain is getting serious. Public buildings as well as train stations, airports, cultural institutions, but also hotels, department stores, and offices may now only be cooled to a maximum of 27 degrees and heated to a maximum of 19 degrees.
In addition to the public sector, employees in the private sector are now also encouraged to work from home. At night, unused offices, as well as shop windows and monuments, must also switch off their lighting.
For the time being, the regulations will apply until the end of October 2023. It is true that enormously high penalties and fines are possible in the event of non-compliance. However, the largely autonomous regions of Spain are responsible for implementing and imposing penalties. The Balearic Energy Minister Juan Pedro Yllanes, for example, had declared that he would trust the businessmen to implement the rules and would not initially carry out any checks or impose any penalties.
In France, energy is to be saved above all in the workplace. Public authorities, for example, are required not to leave equipment on standby and to cool and heat rooms less. Stores must “systematically reduce their light intensity” after closing time and switch off illuminated advertising. Some supermarkets have announced they will close their doors more consistently when the air conditioning is running. According to Agnès Pannier-Runacher, the French Minister for Ecological Transition, this alone could reduce energy consumption by 20 percent.
The government wants to enforce this for all stores in case of doubt, even with fines of up to €750.
Germany is not the only country to rely on voluntary measures to save energy. In Italy, there are savings targets for heating (maximum 19 degrees) and cooling (minimum 27 degrees) in public offices, however, there are no mandatory measures for the industry. Greece is reducing street lighting to the minimum and banning the cooling of public buildings to less than 27 degrees. So far, however, the country does not want to go any further.
This is similar in the Netherlands, Belgium, and Sweden: There, they hope to convince the population to heat less and take shorter showers through advertising campaigns. The Czech Republic is betting that high energy prices alone will lead to savings among the population.
Finland, Denmark, and Lithuania say they have already achieved their savings targets and see no need for further energy-saving measures. So does Estonia. However, heating suppliers and industry are called upon to save gas and switch to other fuels. In the coming heating period, domestic but climate-damaging oil shale could also partially replace gas.
Similar to Germany, Austria is also relying on coal to save gas. For example, the decommissioned Mellach coal-fired power plant is to be put back into operation if necessary. Additionally, large companies and power plants are to be able to use petroleum as an alternative to gas from the fall onwards, with the state bearing the costs of the conversion. This measure is highly controversial, however, as it is enormously harmful to the climate and does not reduce energy consumption.
Additionally, an energy-saving campaign will be launched in the fall. According to the Energy Ministry, the high prices alone have already ensured that around seven percent less gas was consumed in the first half of the year than in the same period last year.
In addition, of course, there are countries such as Poland and Hungary, which explicitly oppose energy-saving measures and have ruled out implementation of the EU savings target for themselves from the outset.
The example from Japan also shows how one can react to the current energy crisis. In Tokyo, too, the government this summer again called to save electricity for the winter – for the first time since 2011.
At that time, the Fukushima reactor disaster was the reason for collective electricity-saving measures that degenerated into a veritable popular sport – called “setsuden”. Baseball and soccer teams moved their night games to the afternoon to use less lighting. Automaker Nissan changed shift times at its factories to ease the strain on the power grid during peak hours, and supermarkets switched to LED light bulbs and installed solar panels in many stores. And the population also saved electricity wherever possible.
The current government incentives for saving electricity include a points program for companies and consumers. Those who save electricity receive points that are reflected in a bonus on their electricity bill. According to media reports, the Japanese government is making a total of €1.3 billion available for the program.
Other parts of the world are struggling with much more fundamental problems. Pakistan fears a catastrophic winter. The country imports almost all of its energy and is suffering enormously from the increased prices of oil and gas. The result: power cuts and declining economic performance. That is why Pakistan now wants to act, even if it is questionable whether the measures will already have an effect in the coming winter.
Pakistan’s energy system is inefficient and wasteful due to outdated power plant technologies and unimplemented building codes and energy standards, as well as price anomalies that invite waste. Now the government in Islamabad wants to set and enforce minimum thermal efficiency standards for different fuels used in power generation. And it’s also looking to raise awareness among industry about energy-saving and efficiency measures that will make Pakistan’s energy system more resilient in the future.
Hardly any country has as much trouble saving energy as the United States. It is still the country with the highest gas consumption. And yet strict energy-saving measures for consumers or industry have so far failed to materialize. This is also due to the fact that the USA is largely self-sufficient in energy and does not depend on imports.
High gasoline and diesel prices have only resulted in President Joe Biden getting his significantly slimmed-down climate package through both chambers of Congress after much wrangling. However, the $375 billion to be poured into climate protection and the energy transition over ten years is aimed primarily at emissions reductions rather than short-term energy savings.
Canada, too, is only planning long-term solutions to the energy transition that are not motivated by the current energy price crisis but by the climate crisis. These include more energy-efficient buildings and the expansion of renewables. Acutely and triggered by the energy price crisis, Ottawa even wants to expand oil and gas production to supply Europe in the future. With dpa
Actually, the goal is clear: Untrusted hardware and software should not be used in critical infrastructures, especially not in telecommunications infrastructures. The debate about the role of the Chinese supplier Huawei had also arrived in the EU and Germany in 2018, mainly at the instigation of the USA. The fear: The components of the Chinese manufacturers and their software could be used both for espionage and – in the event of confrontation – as a kill switch, i.e., misused to shut down entire network areas.
Particularly in the area of the rollout of 5G networks and subsequent generations, there has therefore been a hectic political search for solutions as to how a clear preference can be placed on other providers, above all the European equipment suppliers Nokia and Ericsson. At the same time, Chinese providers should not be subject to legal market exclusion. The EU then published its so-called 5G toolbox, and in Germany, the IT Security Act and the BSI Act were amended.
The core of the political debates: Whereas in the past, it was primarily the distribution network between stations and the providers’ backbone lines that were considered critical since the Huawei debate, and with 5G, the focus has increasingly been on the endpoints of the mobile network. This is because 5G gives them a larger and more active role. The RAN is the mobile network area that establishes the radio link to the end users and connects antennas and hardware at the radio tower with the core network of the providers. One idea for ensuring greater security there: Open RAN – a system of predefined, standardized radio network components and software.
With interoperable individual elements, Open RAN is intended to enable security and interchangeability – without blanket exclusion of certain manufacturers. German and European mobile communications companies, therefore, see Open RAN as a way of minimizing risks. On the other hand, however, the fact that completely different providers can be used should keep costs low. Chinese providers jumped on the allegedly open concept early on and have been supporting it intensively ever since.
In a recently published paper (PDF) by the Digital Power China research consortium, authors Jan-Peter Kleinhans and Tim Rühlig warn against credulity in connection with Open RAN. They say a very precise distinction must be made between what is meant by Open RAN in the first place – and which actors with which interests were involved in the Open RAN definitions. “At least 16 members of the O-RAN Alliance have ties to the Chinese security apparatus,” the paper says, adding that all three of the People’s Republic’s state-owned mobile operators are also involved.
China Mobile, in particular, is problematic as a founding member because it co-chairs ten working groups and is represented on the supervisory board and management board. In addition, China Mobile is a member of the technical steering committee, which decides on technological matters even before publication. The EU Commission and the German government are also warning with increasing intensity of the threat of Chinese players having too much power in such standardization bodies.
The authors see another major problem in the fact that Open RAN committees specify not only hardware but also software. Even if the source code is open, the sheer volume of RAN code is almost impossible to check.
The authors warn against narrowing the debate to Huawei alone – it is about China. Overall, the O-RAN Alliance is “anything but a trustworthy partner”. It is “highly questionable whether cooperation within and use of O-RAN Alliance-compatible equipment can effectively address the issues that are surfacing around Huawei’s role in the 5G rollout.”
At the beginning of May, the EU Commission published a study on the security of Open RAN, in which the European Network and Information Security Agency (ENISA) was involved. This study also identified significant security risks for Open RAN. According to the study, core risks include the fact that Open RAN is not mature enough in terms of security technology and could increase the attack surface for malicious actors.
The German Federal Office for Information Security (BSI) had already commissioned a study in 2019 to examine security risks posed by Open RAN. At the time, the authors from the Barkhausen Institute and Advancing Individual Networks had concluded that the status at that time “contained multiple security risks”. One of these is particularly relevant: Open RAN had not been designed according to the principles of security by design or security by default; building security into standards after the fact was extremely difficult.
Sometimes less is more – even in the sustainability sphere. The EU wants to force significantly more companies to report on measures that ensure greater sustainability. To ensure this, the EU is planning another comprehensive set of rules with the CSR Directive.
As good as it sounds on paper – in practice, the CSR Directive, with its many requirements formulated down to minute detail, stands to overburden most small and medium-sized companies. As a result, the only thing it will definitively ensure is a steady stream of gigsfor consultants.The VDMA, therefore, advocates in favor of a risk-based approach kicks in where companies still have influence in order to obtain qualified information.
The European Financial Reporting Advisory Group (EFRAG) has presented first drafts of the reporting requirements. These were available for public comment until last week. The final proposal will be submitted to the Commission before the end of the year. The standards set out in the document would then be adopted directly by the Commission as delegated acts. SMEs in particular can only hope that EFRAG will take the feedback from the consultation into account when revising the proposals. Unfortunately, this is not certain.
In any case, the “less is more” principle is nowhere to be found in EFRAG’s drafts. And this is problematic in several ways: The purposeof good reporting should be to add value for both the reporting organization and the report users.This means defining and prioritizing which information is and isn’t essential and really necessary. If the requirements are too stringent, there is a risk that reporting will focus on compliance rather than adding value to users and report owners The original goal of “preventing greenwashing” could be missed as a result.
Even for companies with many years of experience in the application of international ESG reporting standards, implementation will be accompanied by major challenges. Complicating matters further is the fact that this data should be collected for the entire value chain. For many companies, the supply chain includes thousands of suppliers. For the large number of medium-sized companies that are will be subject to the CSR reporting obligation for the first time, the requirements will not be feasible in this form. Not only do they not have the expertise, they will also not be able to find experts on the market to help them become compliant.
Overall, the disclosure requirements should therefore be significantly limited in terms of content – especially for medium-sized companies. It should also be imperative that European sustainability reporting is aligned with the global minimum standards developed by the International Sustainability Standards Board (ISSB) -a diverging European approach would be counterproductive.
In the previous drafts, we saw a major risk that consulting companies and auditors will primarily profit from the new standards by being able to acquire new lucrative contracts. However, they will not be able to assess the accuracy of the sustainability disclosures, but only the audited process for collecting and monitoring the reporting disclosures.
That is why the VDMA – as the representative of around 3,500 companies in the capital goods industry – is emphatically in favor of streamlining the CSR reporting requirements. The mostly small and medium-sized companies in the mechanical and plant engineering sector often contribute to sustainability with their products, for example when waste is sorted or recycled at the plants. This has tocontinue to be their main task – not creating reports. The focus should be on adding value with CSR reports. Otherwise, John Naisbitt’s wisdom applies: “We are drowning in information and starving for knowledge.”
