The New Security of Energy Supply Directives. A First Response to Some Big Questions
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The New Security of Energy Supply Directives. A First Response to Some Big Questions* Vesa A. Lappalainen
Published online: 16 August 2007 © ERA 2007
Abstract Two recent European Community Directives – the Security of Electricity Supply Directive of 2004 and the Security of Gas Supply Directive of 2005 – propose to address some problems of Europe’s new ‘energy landscape’. As the Commission’s 2006 Green Paper on Energy Strategy proves, such problems are many, large, complex and intertwined. Security of energy supply has at least four aspects to it, three of which relate to availability and the fourth to affordability. A risk to availability can be short-term, medium-term or long-term. Security of supply can be improved with public support. The new Directives address the right issues, but provide rather small toolboxes for dealing with the problems involved and constitute ‘entry-level’ legislation. Keywords Energy · Gas · Electricity · Security of supply · European Union 1. Introduction During the past few years, security of energy supply has become an issue which seems to be making headlines practically every day and to be included on the agenda of every summit and top-level meeting. ‘Security of energy supply’ is a phrase which was coined to express a concern about emerging energy shortages, irrespective of the source or reason for such shortages. Together with two other large-scale processes or ‘megatrends’ – globalisation
Vesa A. Lappalainen OTK, VT, BA Energy Law and Policy Consultant, Doctoral Student Faculty of Law, University of Lapland Yliopistonkatu 8, 96300 Rovaniemi, Finland e-mail: [email protected] This article is based on a presentation given by the author at the ERA conference The Opening-Up of European Energy Markets, held in Brussels on 26–27 March 2007. *)
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and climate change – security of energy supply is an element of an intertwined com plex of as yet unresolved problems. Each of these problems – although their origins are social, political, economic, and ecological – also has a legal aspect. It is not surprising, therefore, that the European Community has recently made attempts to address, by means of legislation, the security of supply issue in two energy sub-sectors, electricity and gas, by issuing two sector-specific directives: the Security of Gas Supply Directive and the Security of Electricity Supply Directive. The Commission also published a Green Paper on energy security in 2006. These developments, the reasons underlying them and their significance, form the topic of this paper. 2. The Big Picture The world-wide demand for energy is increasing fast. The main reason for this has been the rapid industrialisation and modernisation of the world’s two most populous economies, China and India. In its forecast (which extends to 2030) the International Energy Agency (IEA) estimates that global primary energy demand will rise at an annual rate of 1.6 %. Over 70 % of this increase in demand will take place in developing countries, 30 % of it in C
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