EU energy rules: Cat’s cradle or dog’s dinner?

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Earlier this week I attended a dinner-debate in Brussels on the EU’s proposals for energy efficiency targets.  The plans are marked (like most EU plans) by overwhelming complexity, and several speakers made a good case that the proposals would have far greater impact on poorer member-states with relatively lower capita energy consumption, than on wealthier member-states.

I raised my concerns about another aspect.  Of course no one would argue against energy efficiency in a broad sense.  But the objective of all EU energy policy is to reduce emissions of CO2.  I question whether that in itself should be a high-priority objective, but let’s take it as read for the moment.

The EU has created a huge range of initiatives which aim to support this objective.  We have renewables targets, emissions targets, the Emissions Trading Scheme, plus other “instruments” (as they like to call them) like subsidies, feed-in tariffs, renewables obligations, capacity payments and (in the UK at least) a carbon floor price.  These overlapping measures frequently create both conflicts and market distortions.  They are not technologically neutral.  For example, nuclear power contributes powerfully to achieving emissions targets, but fails to help with the the renewables targets.

One might be justified in describing this morass of legislation a cat’s cradle, if not a dog’s dinner.

In my contribution, I pointed out that green measures had already driven up energy prices in the EU to a level where they are undermining competitiveness, and driving jobs, businesses and investment off-shore.  I mentioned that before politics, I had had a real job running real businesses, and I remembered very well that the issue of energy costs frequently featured at board meetings.  Even then, commercial organisations already had an urgent imperative to achieve energy efficiency.  Today, with the cost of energy so much higher, that imperative is even stronger.

So I presented my killer dichotomy.  Either:

1     If an energy efficiency measure is commercially viable – that is, it if provides a commercial pay-back – then an incentive already exists to implement it, and the proposed EU measure is redundant.  Or

2     If such a measure is not commercially viable, then enforcing it through EU policy or targets will damage the business concerned and further undermine EU competitiveness.

So the efficiency target is either redundant, or it is damaging.  Which is it?  What was the view of the panel?  I am still waiting for the answer.

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14 Responses to EU energy rules: Cat’s cradle or dog’s dinner?

  1. Elizabeth Kemp says:

    And you will wait years for an answer.
    They need to set up a working party
    then receive a report send that to an expert who says no it is
    not like that then they send the report to a panel of experts,
    then back to a new working party oh then its election time
    wait till next parliament.
    Then it will be who cares GB will be out soon any way.

  2. Roger Arthur says:

    Just ponder on these key facts 1. On some winter days UK solar and wind capacity is about 1% of Maximum Demand. 2. UK CO2 reduction measures have been calculated to reduce global temperature by 0.00038 of 1 deg C. 3. Energy intensive businesses have been driven abroad by increased costs, where they emit more CO2 than before. 4. If we developed CO2 capture technology and gave it away to China India and the like, that would have a far bigger impact on global emissions. Once we leave EU jurisdiction, then we can make laws which will not cause needless loss of jobs and which focus on the most cost effective ways of reducing emissions.

  3. Kevan Chippindall-Higgin says:

    You will have a long wait. The EU and greeny brigade never let facts get in the way of a good story.

  4. David says:

    No surprises here, have they ever worked out consequences in any of their schemes?

  5. charles wardrop says:

    Mad-useless and typical of EU!
    Just vanity/virtue signalling.
    Hope UK can escape from the corrupt madhouse the EU has become, for many years.

  6. Shieldsman says:

    I am hoping that Trump will pull out of the toothless Paris agreement. I do not know what China is playing at but they have no plans to stop building coal fired power stations. Any renewables will be in addition. The same goes for India and many other countries.

    Bye bye to uncompetitive Western Industry. We will not have any businesses left for Mr Corbyn to impose increased Corporation tax on.

  7. Dung says:

    Trump is out of the Paris agreement and for all the right reasons even though he has no clue about the science. Trump can see what the effect would be on the economy and on the jobs he promised to bring back, alone of all western governments he has got it right.

    • KennieD says:

      Dung,
      All the people who signed up to the Paris agreement also have no clue about the science, but they know about the money.

    • Ex-expat Colin says:

      Mrs May should have kept her trap shut on this. Disappointed?

      • Charles Wardrop says:

        Hope she is insincere, or she will fall into James Delingpole’s “same old, same old” politico category responsible for the present shambles of Greenery.

      • John Burnett says:

        I think Mrs. May is playing her Brexit cards rather cleverly. She is more like a chess Grandmaster than a politician

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