Past Event

How will the Paris agreement impact EU climate and energy policies?

The COP21 negotiations in Paris resulted in ambitious targets but little detail on implementation. Which measures should the EU now take? Bruegel was pleased to welcome Commissioner Cañete for a discussion on the proposed Commission Work Programme for 2016.

Date: February 8, 2016, 12:30 pm Energy & Climate Tags & Topics

Summary

See below for event materials, video and photos.

All speakers agreed that COP21 has signaled a clear determination to transition to a low-carbon global economy. There was also a general agreement that EU emissions targets and ETS will have to be revised at some point, and that gas will have a bridging role in the energy transition. However, the exact impact the Agreement might have on EU climate and energy policies was less clear. There were doubts about European coordination and risks for successful implementation of market-led strategies.

Reflecting on the negotiations, Commissioner Cañete argued that the EU had maintained its leading role in climate politics. The unanimous EU position, ambitious Intended Nationally Determined Contributions (INDCs) and technical support for developing countries had given real weight to EU “climate diplomacy”. The EU is pushing ahead with ratification, and should aim to be amongst the early adopters.

Hard legislation such as ETS will always lead to decarbonisation, but in an environment of extremely low energy prices, there may be incentives to disinvestment or inefficient investment decisions. The externality of carbon-provoked climate damage will have to be factored in if markets are to deliver, as price signals are currently inappropriate. This situation has damaged investment in clean energy and makes it more difficulty to change consumer behaviour. Professor Luciani believes that oil producing countries are now foreseeing a full phase-out of fossil fuels in the coming decades, and are therefore rushing to dump as much easy-access cheap oil on the market while there are still buyers – rather than slowing production to manipulate prices and investing in expensive extraction of new sources.

When faced with the question of how to internalise carbon damage costs effectively, Commissioner Cañete accepted the need for a major reform of the Emissions Trading Scheme (ETS). However, he insisted that it is better to improve on the existing ETS than scrap it and implement untested alternatives such as a carbon tax. He pointed to China and the USA as regions where some form of carbon trading is being introduced.

Looking ahead to the implementation of the Agreement, many speakers stressed the “revolutionary” nature of the changes needed by the mid-century point. Commissioner Cañete mentioned several arenas in which the Commission would seek to take control: inclusion of agriculture and forestry in emissions policies; focusing energy efficiency programmes on transport and buildings; pushing investment on gas interconnectors and demand-responsive electricity grids that can incorporate and distribute renewable energy.

Hendrik Bourgeois said that the impact of Paris will be limited if Europe does not make a sustained and coordinated long-term commitment to investment and innovation in energy. There is currently a huge investment gap, which he blamed on regulatory risk, especially at the national level.  If this were stabilised, the market would be better placed to find the most cost-effective form of decarbonisation. Likewise, Georg Zachmann argued that it is currently not markets but government schemes which are the main driver of investment decisions.  These schemes frequently diverge in structure and technology preference between member states, and he sees a “renationalisation” of energy policies. However the sheer ambition of the Paris agreement could revitalize European coordination.

Summary by Augustin Lagarde, Research Intern

Event materials

Speech | Commissioner Cañete

VIDEO RECORDING

Event Photos

Web3
Web4
Web1
Web 5

Schedule

Feb 08, 2016

12:30-13:00

Check-in and lunch

13:00-13:30

Presentation

Miguel Arias Cañete, Commissioner for Climate Action and Energy, European Commission

13:30-14:00

Comments

Georg Zachmann, Senior Fellow

Giacomo Luciani, Adjunct Professor, Graduate Institute of International and Development Studies

Hendrik Bourgeois, Vice President European Affairs, GE

14:00-14:30

Q&A session

Chair: Ewa Krukowska, EU Reporter, Bloomberg News

14:30

End

Speakers

Picture Hendrik Bourgeois

Hendrik Bourgeois

Vice President European Affairs, GE

Canete Image

Miguel Arias Cañete

Commissioner for Climate Action and Energy, European Commission

Ewa Krukowska pic

Ewa Krukowska

EU Reporter, Bloomberg News

Giacomo Image

Giacomo Luciani

Adjunct Professor, Graduate Institute of International and Development Studies

Georg Zachmann

Georg Zachmann

Senior Fellow

Location & Contact

Bruegel, Rue de la Charité 33, 1210 Brussels

Matilda Sevón

Matilda Sevón

matilda.sevon@bruegel.org +32 2 227 4212

Read about event More on this topic

Past Event

Past Event

China-Russia relations and their impact on Europe

The economic ties between China and Russia are growing. How will this relation affect Europe?

Speakers: Marek Dabrowski, Zsolt Darvas, Alicia García-Herrero, Vasily Gavrilov, Eric Girardin, Matteo Governatori, Iikka Korhonen, Heli Simola, Laura Solanko, Mingxi Sun and Jianwei Xu Topic: Global Economics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: June 21, 2016
Read about event More on this topic

Past Event

Past Event

The European energy transition: a vision between decarbonisation and digitalisation

This closed-door brainstorming workshop will discuss how the energy system of the future will be shaped by the interaction between decarbonisation and digitalisation.

Topic: Energy & Climate Location: Brussels Date: June 16, 2016
Read about event More on this topic

Past Event

Past Event

European banking supervision: the first eighteen months

After its first 18 months, how has the SSM affected the European banking system?

Speakers: Mario Nava, Dirk Schoenmaker, Nicolas Véron, Pieter Verheugd and Guntram B. Wolff Topic: Finance & Financial Regulation Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: June 14, 2016
Read article More on this topic More by this author

Opinion

Georg Zachmann

Keine Energiewende ohne Energieunion

Die europäische Perspektive ist für den Erfolg der deutschen Energiewende entscheidend. Doch die europäischen Partner werden nicht einfach die deutschen Ziele und Politikinstrumente übernehmen. Ist eine Energieunion die Lösung?

By: Georg Zachmann Topic: Energy & Climate Date: June 13, 2016
Read about event More on this topic

Past Event

Past Event

The Spanish financial crisis: Lessons for the European banking union

Spain is among the countries still recovering from the financial crisis. While misjudged investments were part of the cause, these past mistakes could offer lessons for the European banking union.

Speakers: Miguel Otero-Iglesias, Federico Steinberg, Pia Hüttl and Stefano Neri Topic: Finance & Financial Regulation Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: June 9, 2016
Read about event More on this topic

Past Event

Past Event

Internet taxation: challenges and policy recommendations

As the economy moves online, it becomes more difficult for national tax authorities to collect revenue. How great is the impact, and what should corporate taxation look like in the digital age?

Speakers: Francis Bloch, Caroline Edery, Dmitri Jegorov, Helena Kiurusalmi, J. Scott Marcus and Georgios Petropoulos Topic: Innovation & Competition Policy Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: June 7, 2016
Read about event

Past Event

Past Event

New perspectives for economic cooperation with Iran

The lifting of international sanctions will have a big impact on the economic relationship between Iran and the rest of the world.

Speakers: Benjamin Godel, Zahra Jazayeri, Mohsen Pakparvar, Simone Tagliapietra, HE Peiman Seadat, Farhad Sharif and Guntram B. Wolff Topic: Energy & Climate, Global Economics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: June 2, 2016
Read about event More on this topic

Past Event

Past Event

Euro-Mediterranean energy talks

The energy landscape of the Southern and Eastern Mediterranean is inefficient and unsustainable. Yet there is much potential for cooperation. How could the EU work with this region to improve energy systems?

Speakers: Ali Aissaoui, Houda Allal, Ahmed Badr, Moncef Ben Abdallah, Jorge Borrego, Claudia Brandus, Uri Dadush, Karim El Aynaoui, Angelo Ferrante, Francesco Giunti, Ali Hached, Manfred Hafner, Ezzedine Khalfallah, Stefano Manservisi, Mehmet Öğütçü, Francis Perrin, Sabina Ratti, Edoardo Reviglio, André Sapir, Simone Tagliapietra, Hans van Steen, Guntram B. Wolff and Georg Zachmann Topic: Energy & Climate Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: May 31, 2016
Read about event

Past Event

Past Event

State Aid evaluation: two years of implementation

This event discussed the evaluation of state aid and how it can contribute to better policy-making.

Speakers: Gert-Jan Koopman, Pantelis Koutroumpis, Nicola Pesaresi, Theo Roelandt, Otto Toivanen, Reinhilde Veugelers and Georg Zachmann Topic: Energy & Climate, Innovation & Competition Policy Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: May 30, 2016
Read about event More on this topic

Past Event

Past Event

Lessons for the euro from early US monetary and financial history

The United States has a monetary union that many look to when considering the future of the EU. But how easy was it really to create such a union and what can Europe learn from the US process?

Speakers: Jeffry Frieden and Guntram B. Wolff Topic: European Macroeconomics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: May 25, 2016
Read about event More on this topic

Past Event

Past Event

The United States and Europe: Short-term divergence but shared challenges

Europe and the United States have had divergent experiences since the economic crisis. But they share several challenges in the years ahead: slowing productivity growth, rising inequality, and falling labour force participation. How can those challenges be turned into opportunities?

Speakers: Jason Furman, Natacha Valla and Guntram B. Wolff Topic: Global Economics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: May 11, 2016
Read article More on this topic More by this author

Opinion

Simone Tagliapietra

EU must step up energy cooperation with southern Mediterranean countries

Furthering energy cooperation between the EU and countries in the Southern Mediterranean is a challenge, but also a great opportunity. Supporting sustainable energy projects in partner countries could make them more economically stable and help safeguard the EU’s security of gas supply.

By: Simone Tagliapietra Topic: Energy & Climate Date: May 4, 2016
Load more posts