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Europe’s future energy system: What role will citizens play?

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The legislative proposals released by the European Commission on 30 November 2016 seek to give Europeans a greater role in our future energy system. This is deeply necessary – not only to boost public support for the low-carbon transition but also to make citizens an integral part of it. Nevertheless, despite good intentions, the proposal falls short of achieving this goal. A number of promising provisions around citizens cannot hide that despite their transformative potential, other local actors – in particular local authorities – remain sidelined on key issues. But there is hope that the shortcomings will be fixed.

‘Clean Energy for All Europeans’ is the promising umbrella title of a number of legislative proposals published by the European Commission on 30 November 2016. Also known as the ‘winter package’, the files seek to prepare Europe for the transition to a low-carbon economy.

The Commissioners responsible for energy, Maroš Šefčovič and Miguel Arias Cañete, have previously made clear how they see Europe’s energy future. Their vision is to create an Energy Union with citizens at its core. Of course, this is not achieved overnight, but the winter package has the ambition to lay foundations that enable important steps in this direction. Has it achieved this aim?

A fundamental transformation

Our energy system is going through a massive transformation. Currently, electricity generation is still very much centralised, meaning that the majority of the production takes place in huge coal, gas or nuclear power plants. This pattern of production is going to change fundamentally. Our everyday lives will be increasingly powered by an ever-growing number of wind turbines, solar panels and other renewable technologies, spread out across rural and urban areas and replacing today’s large power stations.

Of course, we are already right in the middle of this process of decentralisation. Not only have the roofs of many of our neighbours turned into solar power plants; we have also started to adopt smarter ways of consuming energy based on more efficient household appliances, better insulated buildings, e-mobility, and many more. Some companies and households now even manage their demand. They preferably consume electricity in those times when large supplies push down prices, for instance because the wind is blowing strongly.

Taking all of this into account it becomes clear: we are not mere consumers of energy any longer, believing that “electricity comes out of the plug”. Instead, we are steadily developing into prosumers – producers and consumers of energy at the same time – and viewing electricity as a commodity whose generation, availability and price level we can collectively influence. The winter package may have been called ‘Clean Energy for All Europeans’. However, given the increasingly active role of consumers, ‘Clean Energy by All Europeans’ would be a more appropriate name.

What’s in there for the citizens?

Surely, the text proposed by the Commission won’t remain the same as it stands today. Before it becomes actual law, it will be subjected to debates in the Council and the European Parliament.

Agreement has to be found on files that commonly add up to quite a mammoth project. A total of 4,300 pages across a wide range of energy issues are testimony that the winter package will indeed define Europe’s energy system for decades to come.

Provisions that empower citizens are dispersed across 8 relevant legal texts but can be grouped under three broad themes:

The winter package helps citizens become active market participants

The Commission aims to ease citizen participation in the energy market. New provisions grant Europeans the right to generate, consume, store, and sell their own electricity. It will also become easier to set up new community energy schemes. Moreover, the combination of new rules and smart technologies enable citizens to adjust their consumption habits, respond to price fluctuations, and thereby lower their energy bills.

The winter package gives citizens a stronger voice

The proposals include the development of short-term (10 year) as well as longer-term energy and climate plans (50 years) by Member States. In both, public participation is an important requirement: the planning exercise is not a technocratic process but a political one, involving relevant stakeholders and the public. The plans also include a social dimension as the central governments are asked to report on the social consequences of the energy transition, for instance when a coal mining region undergoes a coal phase-out.

The winter package makes citizens better off through more efficient energy use

The package reinforces successful energy efficiency policies that directly benefit citizens. Already today, existing requirements to produce more efficient products save European households €332 annually on their energy bills – and now, proposed new categories of products will lower bills even further. Moreover, the emphasis put on building renovation will help lifting household out of energy poverty and improve the quality of life in Europe. It is also good for growth and jobs: the combined measures to reach the EU’s energy efficiency target will create an estimated 900,000 jobs that employ citizens and create local value.

In a nutshell, the winter package makes a number of important steps in the right direction. It gradually transforms our energy system towards a citizen-led, participatory energy system. Europeans will be able to play a more active role in energy production, energy consumption and decision-making, and reap the vast benefits of more energy efficiency.

Strong on citizens, weak on local actors

While the winter package undeniably strengthens the rights and role of citizens, it falls short of harnessing all available local potential. There is an imminent danger that provisions to generate back-up electricity supply could financially advantage old, fossil-fuel incumbents over new market players. Similarly, a new body to take important decisions on electricity grid operation is likely to be dominated by large actors, disadvantaging smaller, local actors.

In an unfortunate waste of local potential, the proposal fails to acknowledge ongoing actions of cities in the fight against climate change. Across Europe, more than 5,600 Sustainable Energy Action Plans have been developed by local authorities under the Covenant of Mayor framework. These plans entail local self-commitments to lower greenhouse gas emissions and are a vivid example of bottom-up transformational potential. The winter package, however, does not require Member States to consider available local plans when setting up their national energy and climate plans.

The good news is...

...that the files can still be improved. They rest now with the Council and the European Parliament. Particularly the latter has a record of vividly defending the rights of citizens and their local or regional constituencies. The vision of an energy system with citizens at its core can only become a reality if the players closest to citizens, in particular local and regional authorities, are empowered.

The other good news is that local initiatives are eager to move ahead – irrespective of the legislative progress of the winter package. Local, citizen- or city-led initiatives are sparking all across Europe, transform our energy system, and gain momentum. For this Friday, the European Covenant of Mayors has announced to launch a ‘Board of Mayors’, a unique bottom-up political movement within the broader framework. Maroš Šefčovič will attend the ceremony. The message to him and the public is clear and hardly a surprise: cities matter, their actions matter, and they want to be heard.

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