EU Energy Security 2.0
Taking its first step towards the delivery of the Energy Union, on Tuesday 16th February, the European Commission (EC) presented its Energy Security Package. With the aim of bolstering security of supply, the package sets out a wide range of measures to strengthen the European Union’s (EU’s) resilience to gas supply disruptions and takes yet another small step towards the creation of a truly interconnected and integrated internal energy market.
These initiatives come at a critical time for EU energy policy and the energy industry as the European Institutions ready themselves for simultaneous discussions on two other initiatives that will also play a pivotal role in shaping the future of the EU’s energy system: the reform of the Emissions Trading Scheme (ETS) and the initiative for a New Energy Market Design. The outcomes from these debates and negotiations on the Energy Security Package will send relevant signals to investors and will have an important impact in terms of defining the future of the energy industry.
In a post COP21 era, NGOs reacted negatively to the unveiling of the package, accusing the EC of ignoring the commitments made in Paris. By presenting a package that almost exclusively deals with gas, NGO’s argue that the EC is sending the wrong signals in spite of indicators showing weakening demand for gas in Europe. However, the EC’s plan to revamp EU gas related legislation had been announced long before the Paris agreement. Indeed, within the context of this “lower for longer” oil price environment, the EC’s Energy Security Package is an invitation for the gas industry and the EU28 to evolve and adapt to new market realities.