Energy and Climate Change

Keynote speech by Professor Jerzy Buzek President of the European Parliament 'Challenges for a new European energy strategy'

Brussels -
Wednesday, March 2, 2011

Dear Colleagues,

This conference comes at an important time. We have held an important Council on energy at the beginning of February which has outlined the general direction the EU will take over the coming years.

But it is the lesson of the past weeks that is the most important. That our neighbourhood is unstable and this has a direct effect on our energy supply. We receive almost 16% of our gas supply from North Africa. Libya suspended shipments of gas to Italy on Monday.

Let us not forget that the current situation in North Africa can be the situation in Eastern Europe, the Caucuses and Central Asia, tomorrow. The struggle for freedom that the people of North Africa are undertaking is legitimate. We support their aspirations. But the side effect is that we must rethink the basis of our long term energy policies.

If we do not want to face such shocks on a regular basis, is it not the time to reflect on our policies towards authoritarian regimes? Which happen to have oil and gas? Who financed Gaddafi?

Two years ago the conflict between Russia and Ukraine resulted in eighteen countries being cut off from supplies for two weeks. During that crisis we lacked proper instruments to react at the EU level. The 2004 Directive proved to be not enough.

My main political message today is this - how long can we base our energy policy on the hope that supply will be stable? This is not a policy but wishful thinking.

Dear Friends,
Gas will remain part of our energy mix for a long time. It already makes up 25% of energy used in the EU but over 50% of our gas is imported. If nothing changes, within ten years 80% of our gas supply will be imported.

But our main problem remains one of legislation. Today there is no EU single market in energy. In reality we have 27 markets, and each one of these markets negotiates with both supply and transport countries their share.

We need to change this because we need more Europe and not less Europe in this sector. We should consider joint purchases of gas from third countries, in order to create economies of scale.

This fragmentation leads to higher costs. Our enterprises waste money when they can not sell the energy they produce. And some of our consumers pay energy bills that are equal to a second rent.

We know that the European Commission is addressing this. There are also some regional initiatives emerging. We have just seen the creation of the North Sea energy grid.

A new regulation on the security of gas supply was introduced last year which will be fully implemented by 2014. These are all good steps but to protect our citizens we need to do more - and urgently.

We need to implement the Energy Efficiency Package. We need to implement our Strategic Energy Technology (SET) plan which I was the rapporteur for in the European Parliament. In 2008!

We also need to apply the laws we already have. The third energy packet is very good but the second one is still not fully implemented!

Ladies and Gentlemen,
Energy in Europe is also underfunded. The Commission tells us that over the next ten years, the EU needs some €1 trillion in energy infrastructure investments. Most of it will have to come from private sources.

We also have international commitments in the fight against climate change. Where we have formulated environmental goals of 20% renewables. This will also cost money to implement.

Dear Friends,
A single market in energy is as difficult as the creation of the four freedoms of the internal market. Today we need a fifth freedom, the free movement of energy. But to achieve this we need to lay the foundations, as we did in 1992 with a package of legislation that will allow us to launch such a single market.

Almost a year ago I proposed, with Jacques Delors, the creation of a European Energy Community. We were not proposing a new Treaty. This was meant as a political umbrella. A name brand which can link together many existing projects in order to accelerate our integration in the field of energy.

We can think of joint investments in gas storage and in transportation. Energy interconnectors. Joint investments in power stations. In today's financial climate we can maximise Euros spent by spending them intelligently.

The 4 Billion Euros the European Commission put aside for energy projects last year allowed us to leverage 30 Billion in spending. This is the value added that the EU gives.

My final message is that we need to also rethink our priorities. Energy projects are probably more important for today's EU than transport projects, because energy is the life blood of our economy. Only by providing cheap and secure energy will we remain competitive in the 21st century.

We need to work together and use the community instruments to achieve a true European Energy Community. To achieve this we need a wide agreement of all sectors - both the business community and politicians.

We also need more conferences like this one. To paraphrase Ronald Reagan: All great change in Europe begins in the conference room!

Thank you!