Activity Report 2012 - Eurelectric

More specifically, EURELECTRIC believes that a key
underlying cause of current concerns about the ETS is
the lack of coherence between the instruments being
used to deliver the 20:20:20 policy objectives, and
that the ETS must be defended as the most effective
and market-compatible mechanism available to deliver
greenhouse gas reductions. The Board therefore
decided in november 2011 that EURELECTRIC needed
to join the growing public debate on the ETS, or risk not
being heard. In March 2012 the Board further decided
to support a short-term fix to the ETS, linked to a longterm
resolution of the coherence problem.
During 2012 members of the Environment and
Sustainable Development Policy Committee and its
working groups, together with the Secretariat, have
worked first to convince the EU institutions these issues
need answering, and second to advocate our preferred
answers. It is a slow and laborious task – our criticisms of
the current EU 20:20:20 package have not always been
welcome! nonetheless, as we move into 2013, there is
potential for progress on both the 2030 CO 2 reduction
target and the ETS during the remainder of the current
EU mandate until november 2014.
Policy coherence
Concerning policy coherence, the crucial lesson learned
by our sector about the 20:20:20 package is that its
policy instruments are competing with one another.
Strong subsidies for renewables and separate energy
efficiency targets are undermining the electricity market
and the effectiveness of the ETS as a market compatible
tool for cost-effective emissions reductions.
Throughout the year EURELECTRIC has repeatedly raised
this concern with the Commission, most publicly at
a EURELECTRIC workshop in October. Our key task
in the first half of 2013 will therefore be to define
EURELECTRIC’s preferred solution. One long-term answer
being considered by the Commission is to focus on
policies to deliver renewables and energy efficiency.
But in this case the ETS would not be the driver for
low-carbon investments. Another solution could be for
the ETS to be the single policy instrument after 2020,
with no additional support for mature renewables and
energy efficiency technologies outside the carbon price.
These are two scenarios for EURELECTRIC members to
discuss. A middle-way solution is also being explored by
EURELECTRIC using the Power Choices Re-Loaded study
which will be published early in 2013.
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