The end of 2019 marked the approval of the new European Commission, headed by Ursula von der Leyen, that took office in December of the same year. Announcing the new Commission’s agenda, president von der Leyen revealed, among others, two ambitious and distinct goals among its top priorities. She declared the new Commission’s commitment to make Europe the first climate-neutral continent by 2050 through the implementation of the ‘European Green Deal’ roadmap, and pledged to lead a ‘geopolitical Commission’ where reinforcing the EU’s role as a relevant international actor, would be a crucial priority.1 Placing the environment and geopolitics among its the top priorities, the new Commission seems to be signalling a drastic change from the former Commission where the then President, Jean-Claude Juncker, claimed to lead a ‘political Commission’ with an agenda for jobs, growth, fairness and democratic change.2 However different at first glance, these two agendas are linked through a very interesting component that is no other than their energy policy. One of Junker’s Commission top priorities was the formation of ‘A Resilient Energy Union with a Forward-Looking Climate Change Policy’.3 The deployment of the ‘European Green Deal’ is therefore firmly based on the foundations laid by the ‘Energy Union’ strategy launched in February 2015 that, to a great extent, are still in effect and determine the extended aspects of EU’s energy policy and regulatory framework. The objective of the Energy Union is to create the conditions under which European citizens can benefit from secure, sustainable, competitive and affordable energy.4 However easily phrased, such an objective constitutes an extremely challenging task that involves a structural transformation of the European energy system, including the production, procurement, transportation, distribution, storage, pricing, trading and consumption of energy. In addition, it involves structural changes regarding the energy mix, i.e. the combination of energy sources used in all human activity, the flow of energy that enters and exits the EU, and the interconnection of the energy policy with EU’s Trade, Competition and External Relations policies. The essence of the Energy Union can be linked directly to the core objective of the European Union itself originating back to the Treaty of Rome in 1957 and the provisions of Article 2 regarding the establishment of a common market.5 The Energy Union provides the conditions to create a functioning common market with solidarity between the Member States in their efforts to secure energy for the citizens. This can be achieved via an integrated European energy system, where energy flows freely within and between the Member States. Such a system needs to be functioning under competition and efficient use of resources, under an effective regulatory framework, and with energy markets that support a sustainable, low-carbon and climate-friendly economy. It needs to place the European citizens at its core, taking ownership of the energy transition, and benefit from new technologies to reduce their bills and participate actively in a decentralised energy market. Such an ambitious plan requires colossal structural changes that affect almost every aspect of everyday life within the EU.
To achieve its goals, the Commission outlined five fundamental dimensions of the Energy Union strategy; five critical elements that hold the tools to lead the EU towards the necessary transformation of its energy system. These tools are designed to enhance energy security, sustainability and competitiveness within the Union; they are rigidly interconnected and intended to reinforce each other. The five dimensions of the Energy Union relate to (a) energy security, solidarity and trust between the Member States, (b) a fully integrated internal energy market, (c) energy efficiency and moderation of demand, (d) decarbonising the European economy and (e) research, innovation and competitiveness in the European energy market.6 The implementation of the Energy Union is a challenging task that faces a broad spectrum of issues spanning from regulatory and security concerns to the differences and particularities between various regions of the EU, and from challenges regarding the transition to a new energy mix to the technical aspects and difficulties facing such a transformation. EU’s energy regulatory framework focuses primarily on the structure and effective functioning of free-market and competition conditions in the European energy sector. Based on this framework, the Commission strives to transform EU’s energy systems towards an energy mix in which clean, renewable and sustainable energy holds an ever-growing share in order to reach its Paris Agreement targets to limit CO2 emissions and limit global warming effects. Wind and solar power lead this effort in the EU, while alternative technologies for power generation and energy storage supplement the overall struggle for a cleaner environment. However critical, implementing a growing renewable energy share into the European electricity sector presents several challenges regarding the stability and resilience of European energy systems. Furthermore, the role of natural gas and renewable gases in assisting the transition towards lower CO2 emissions and the integration of multiple alternative technologies are essential for the secure transformation of the European energy sector. The effort for energy security is also linked directly to the successful implementation of policies that encourage energy savings and the efficient use of the available energy resources. Energy efficiency, therefore, holds a vital role in shaping the future of energy consumption and is, in turn, directly affected by several technical aspects of the Energy Union policy. The overall success of the Energy Union is also linked to the positive effects it can generate for third countries within the EU neighbourhood area as well as its interaction with other international regulatory frameworks. EU’s participation in international agreements like the Energy Charter Treaty, and international organisation like the Energy Community, bring the European Union and its neighbouring countries from the former Soviet Union, the Western Balkans and, on a broader framework, the South-Eastern Europe and Eastern Mediterranean regions, closer together to create an integrated pan-European energy market.
The two later sub-regional systems, South-Eastern Europe and the Eastern Mediterranean present particular interest and hold a distinctive role in EU’s efforts for energy security. Exposed to specific security, geographical and structural conditions, the two regional systems entail the potential both for opportunities—regarding the enhancement of European energy security—and threats, regarding their exposure to political pressures from third countries. In its new strategic agenda for 2019–2024 released in June 2019, the European Council provided the new framework of its strategic objectives focusing on five main priorities that include protecting citizens and freedoms, developing a strong and vibrant economic base, building a climate-neutral, green, fair and social Europe, and promoting European interests and values on the global stage. Analysing a wide range of perceived threats and challenges, the Council’s Strategic Agenda identifies, among others Energy Security, promoting political reform, the rule of law, economic convergence and good neighbourly relations in the Western Balkans, strengthening the European Neighbourhood Policy (ENP) to the east and to the south of EU, the extension of Trans-European Networks and the Energy Community with physical and digital connections, and supporting the sovereignty, independence and territorial integrity of states, the inviolability of borders and the peaceful settlement of disputes.7
Out of the wide span of security challenges and objectives set in the EU’s Global Strategy documents, the ones related to the regional subsystems of SE Europe and Eastern Mediterranean seem to carry common characteristics regarding the action and tools needed in order to address them. These include the strengthening of the internal resilience and external cooperation between states in the region that keep and promote European principles and the rule of European and International law against threats by state and non-state actors. Regarding the regional system of SE Europe, a special focus relates to the subsystem of the Western Balkans, and its energy relations with other EU member states in the region, namely Greece, Bulgaria and Romania. The Western Balkans in particular, face long-enduring security and energy challenges. Conflicts following the break-up of the former Yugoslavia in the 1990s left most of its energy infrastructure damaged, while the ongoing political turmoil discouraged investments in new energy infrastructure. The region suffers from the lack of coherent policies to address energy security, diversification of energy sources and energy poverty. The wider Balkan region, including its EU Member States, is considered by the EU as essential to the overall integration of European infrastructure networks. All the Western Balkans countries have committed to increasing their share of renewable energy by 2030 to reach between 25 and 40% of their energy mix, as part of their obligations under the Energy Community Treaty. Parallel to the situation in SE Europe, the second subsystem under consideration, the Eastern Mediterranean, is inherently overloaded with a political dynamic characterised by competition, shifting power differentials and states striving for maximising their influence and power. The existing state rivalries have been intensified by the discovery of natural gas which appears to augment long-term security dilemmas bound to also involve third powers with interests in the region and its resources. The Eastern Mediterranean natural gas reserves are concentrated in the Levantine Basin, and include four major offshore gas fields; the Israeli Tamar and Leviathan fields, the Cypriot Aphrodite field and the Egyptian Zohr field.
Overall, on a regional level, EU’s energy objectives for SE Europe and the Eastern Mediterranean relate primarily to issues of energy security and the internal energy market. However, the EU’s overall policies on climate change also bear a direct effect on its regional interests in the two subsystems. In particular, the EU’s commitment to reduce CO2 emissions, lead to policies aiming to rapidly reduce and eliminate coal-fuelled power production. Taking into consideration that coal-fuelled power production has been one of the major locally acquired sources of power production, the decision for its elimination bears the question of its replacement. Although the Commission’s objective is to replace coal-fuelled production with Renewable Energy Resources (RES) production, limitations in electricity storage technology, combined with an unstable environment for new investments, pose a challenge for the rapid expansion of RES in the two subsystems and raise the question on the role of natural gas as a transition fuel.
Regarding EU’s energy security, SE Europe and the Eastern Mediterranean, hold a crucial role primarily regarding EU’s efforts to decrease its dependence from Russian gas through the development of the Southern Gas Corridor for the supply of gas from the Caspian and the Middle East, the expansion of liquefied natural gas (LNG) infrastructure to ensure the liquidity and diversity of the regional energy markets, and the linking of European markets with the Eastern Mediterranean through electricity and gas interconnections.8 EU’s Energy Union policy offers a comprehensive tool for regional cooperation in the Balkans and the Eastern Mediterranean where new energy networks and interconnections strengthen economic activity between states and improve economic output, thus offering the conditions for stronger internal resilience and external cooperation between states in the region. All the above elements, affect and shape the European energy sector in a continuous play of cooperation, collision and interconnection, thus raising the significance of a comprehensive and efficient framework to combine them. The Energy Union offers such a framework and has been the driving force for change in the European energy sector. It is the link between EU’s fundamental drive towards a free-market and competition economy, its commitment to secure the availability, affordability and efficient use of energy resources and its resolve to protect the environment and secure a better future for all European citizens.
The chapters that follow examine these aspects of the Energy Union policy and the ways its implementation affects everyday life for European citizens. The book begins with a presentation of the overall framework where energy policies are applied, with three chapters addressing the security and geopolitical aspects of the Energy Union and analysing the relationship between energy security and national security. It continues with a regional focus where four chapters explore and analyse the regional, regulatory and investment aspects of the Energy Union with a particular focus in South-Eastern Europe and the Balkans. The transitional aspects of the Energy Union towards green energy and a circular economy are addressed in the following five chapters, examining current developments and the role of wind power generation, as well as the role of biofuels, renewable gases and LNG on the road to the energy transition. The book concludes with two chapters addressing specific technical aspects of the Energy Union regarding energy analytics, the transition from data acquisition to data-driven business models, and the role of equipment maintenance as a key factor for energy efficiency.
The broad spectrum of influence energy holds in all aspects of economic activity, renders the Energy Union as one of the most crucial policies in the European regulatory and political framework. The success in achieving its objectives will prove vital for the overall success of the European integration project and the European way of life.
1.1 About the Book
This publication consists of four parts, that include a total of fourteen chapters. The book is structured to deliver a broad educational output regarding the implementation of the Energy Union strategy while maintaining a pragmatic approach in analysing the various aspects of the policies in question. Furthermore, this publication helps create a connection between the EU’s fundamental objectives regarding the structure of a common market and the challenges deriving from the European energy security framework on a national and supranational level. In addition, the book offers assistance in understanding the links between the von der Leyen Commission’s priorities regarding Climate Change and its ‘geopolitical’ character, in comparison to the Juncker’s ‘political’ Commission, and it’s agenda for jobs, growth, fairness and democratic change.
Part I of the book contains three chapter...