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The Warsaw Voice » Business » February 27, 2015
Central Europe Energy Partners
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CEEP in 2014 – A Year of Working for Industry
February 27, 2015   
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Dozens of meetings in Europe and the United States; numerous publications, articles and statements; participation in bodies that make decisions about the future of Europe’s industry—those were some of the key activities undertaken by Central Europe Energy Partners (CEEP) in 2014. The association also made efforts to closely monitor climate policy issues and developments in the energy-intensive and energy sectors.

One of the most important issues of interest to our association in 2014 was a report launched last November at a major conference in Istanbul. It represented a joint project by CEEP and the Atlantic Council, a leading U.S. think tank.

Completing Europe—From the North-South Corridor to the Energy, Transportation, and elecommunications Union

In our opinion, the rapid development of the North-South Corridor, which would constitute an integrated network of interconnectors in the energy, transport and telecommunications sector, would contribute to strengthening the EU.

CEEP is calling for the establishment of the Corridor as a system of developed infrastructure connections, i.e. natural gas and oil pipelines, electrical grids, highways, rail and telecommunications networks, that will stretch from the Polish coast and the Baltic states (Estonia, Latvia and Lithuania) to the Czech Republic, Slovakia, Romania, Hungary, Bulgaria, Slovenia, and finally to the coast of Croatia, with the inclusion of Ukraine and Moldova.

Low-priced energy is key to Europe’s revival

Since its establishment, CEEP has been arguing that Europe must concentrate its efforts on decreasing the costs of energy if it wants to maintain its potential and position in the global economy. Only if this goal is achieved will European industry be able to compete globally.

Environmental clichés instead of argument-based discussions

The long-standing debate in Europe on whether or not it is better to decrease CO2 emissions by 30 percent or perhaps 40 percent has been devoid of solid calculations of the potential impact such a move would have on the European economy and on Europe’s competitiveness with regard to other global players. In 2014, we witnessed an unexpected success in the “battle” for data transparency. In recent years, we have been arguing that CO2 emissions should be reported annually in “tons per capita” as only such an approach provides a clear image of where we stand, and the data becomes more transparent and comprehensible. For many years, our argument came to the fore only at specialized debates. However, in late 2014, identical thinking was displayed by scientists from Paris Dauphine University. Hopefully, this is a sign of things to come.

Coal—a source of low-cost and secure energy for Europe

In March last year, the 23rd meeting of the European Round Table on Coal was held at the European Parliament in Brussels. The meeting provided us with a chance to present our Action Plan document, outlining our stance on the key issues and challenges ahead of the European coal industry.

The “Memorandum on energy and climate goals for 2020-2030,” presented by CEEP to Herman van Rompuy in March, was a particularly important supplement to these activities.

In terms of the European Parliament and the European Commission, we successfully postulated that all decisions related to climate and policy in the energy sector be left within the competence of the new Parliament, Council and Commission, which should be given more time to reflect on the complexity of this issue and take a sustainable approach to the present economic situation in the EU and to climate issues at the global level. We will continue to carry out our activities related to coal in the European Parliament under the new format of “Coal and Steel,” with Prof. Jerzy Buzek, a MEP and Chairman of the Committee on Industry, Research and Energy (ITRE), at the helm.

The everlasting topic of security in the energy sector

In April 2014, the European Economic Congress in Katowice, Poland, proved to be a fitting forum for presenting CEEP’s ideas and proposals, as it is traditionally one of the leading venues for meetings by businesspeople and politicians in Central Europe. Our panel discussion, “The Common Energy Market in Europe,” was one of the key debates at the Congress.

The session was dominated by the question of security in Europe’s energy sector. Most participants were unequivocal on this issue. Europe has gone too far in its ambition to implement the challenging goals of climate policy, by “making a sacrifice” and putting jobs at stake, undermining the continent’s social and economic security, and threatening the very existence of its industry. CEEP is therefore calling for maintaining a balance between European economic policy and climate policy, as well as for stimulating the growth of the European economy.

‘Energy April’ in Bucharest

In late April, CEEP hosted another “29+1” summit, held under the auspices of the Romanian prime minister. The event, now three years old, enables representatives from 29 leading companies from Central Europe’s energy and energy-intensive industries to meet with the EU’s Energy Commissioner. The summits have produced special memoranda drafted by CEEP that have been accepted with great interest by the EU’s Energy Commissioner. The main aim of the meetings is to ensure that Central Europe’s energy sector speaks with one strong voice in Brussels. In Bucharest, we endorsed what will be one of the EU’s flagship initiatives in the coming years: the EU Energy Union.

Berlin important to the energy sector

In 2014, CEEP, together with Pflüger International and the German Association of Energy and Water Industries (BDEW), hosted five meetings in Berlin as part of the Energy Dialogue series, which is known and highly appreciated by experts. This unique platform provides us with an opportunity to present all the concepts and ideas related to the development of the energy sector, as well as to reinforce our position in the German parliament.

Autumn marked by second climate package

In late October, the European Council met in Brussels. The main item on the agenda was the acceptance of the EU’s climate package for 2020-2030. The meeting came at a particularly difficult time when the new European Commission was being constituted.

The official position of the European Council, released following the October talks, opened the door to simple solutions in the form of directives and other regulations that will make it possible to implement the rules adopted at the Council’s meeting. Having said that, we should keep it in mind that, although the summit expressed an understanding for the proposals of the less well-developed countries from Central Europe, this does not necessarily mean that the EU’s bureaucracy will promote and encourage these solutions.

We need to combine our forces to ensure that the summit’s decisions are put into practice. It is worth noting that, under the current directive, entities in Central Europe can benefit from CO2 emission derogations in the production of electricity by coal-powered power plants. This seems to be crystal clear.

Council adopts CEEP’s proposal

The European Council has approved a long-standing proposal put forward by CEEP concerning the Fuel Quality Directive, thus enabling the adoption of the “default value concept” for crude oil. This allows Central European refineries to operate without further legislative burdens, mainly by importing crude oil from Russia.

TTIP

CEEP has played an active role as a stakeholder in preparing positions on energy and energy-intensive industries in Central Europe for negotiations between the United States and the EU. We had the chance to present our positions in front of a joint U.S. and EU negotiating team for energy. As the issue is on the table, we are prepared for further discussions in 2015.

Emissions Trading System (ETS) and Market Stability Reserve (MSR)

These two topics are crucial for the industries represented by CEEP. Either these industries (refineries, steel, chemical industries and coal-fired power plants) will be on the carbon leakage list or will be completely phased out from the EU economy.

New members

Last year was a productive one in terms of organizational development for CEEP. Further companies from the energy, steel, mining, machinery, petrochemical, as well as legal and financial sectors joined the ranks of CEEP’s members. In the first half of the year, ArcelorMittal Poland became a member of the association. CEEP also welcomed KGHM Polska Mied¼ S.A. and Lurgi S.A. (Air Liquide Global E&C Solutions). Moreover, Ukraine’s Sumy Frunze joined CEEP, followed by PERN “Przyja¼ñ” SA. Other notable newcomers were the Polish Electricity Association (PKEE) and the international law firm Clifford Chance.

Pawe³ Olechnowicz
Chairman of the Board of Directors Central Europe Energy Partners
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