The Energy Union should be an opportunity to accelerate the energy transition and define a new set of roles, rights and responsibilities for the new players who are at the forefront of it. Instead, the project is mostly focused on creating a giant supergrid of interconnected national energy markets, forcing almost all kinds of renewable energy projects to compete along the same rules. As the Commissioner in charge makes his presentation of the “state of the energy union”, Energy Cities decided to provide an alternative picture of how the energy transition has progressed at local level across the five pillars of the Energy Union: decarbonisation, energy efficiency, the internal market, energy security and research and innovation. For each of these pillars, the paper points to recommendations on how European competition and energy legislation could be improved to sustain the momentum.
#1 Decarbonisation means a proper phase-out plan for fissile and fossil-based economies
Cities are the lead actors of the post-carbon economy, with many of them committing to fossil-fuel-free or climate neutral strategies, while others adopt ambitious divest plans. To go forward however, these decarbonisation efforts require a similar push from the EU level, with incentives to channel European funding or revenues from the ETS auctioning towards local sustainable energy projects, which hold great potential to bring Europe closer to its climate neutrality goals.
# 2 Energy security requires a real (sector and player) diversification strategy
Merely switching energy suppliers to address geopolitical shocks is not the most viable way of addressing security of supply. Relying excessively on capacity reserves from centralised power stations - an option still favoured by numerous EU Member States - also very much reads like an outdated solution in an energy system underpinned by technologies that are increasingly flexible, distributed and decentralised. At local level, cities are putting real diversification into action, not only changing providers but also working across sectors and networks: using heat as an energy source or storage medium, and more generally optimising the various flows that cross their territories. To continue down that road however, they must be supported by an internal market that discourages overcapacity instead of supporting it, and that enables more innovative practices to combine the various local networks in order to increase the system flexibility.
# 3 New market realities call for reshuffling responsibilities
Moving to a “fully integrated” energy system also calls for consolidating the position of new entrants such as local utilities and cooperatives. More and more cities are creating their own energy companies and supporting citizens who strive to become energy producers and the new internal market rules should better accommodate their fair participation to the market.
# 4 Energy efficiency efforts should rely on a systemic logic
Increasing energy efficiency is about much more than reducing end user consumption.
It supposes planning intelligently the development of a neighbourhood, district, city or larger area. At present, EU legislation sometimes poses obstacles to this integrated approach by favouring individual solutions that can be counter-productive.
#5 Research and innovation efforts should support 2050 transition visions
Research & Innovation efforts across Europe should help cities test innovative transition kits, putting more emphasis on social innovation and experiencing with new practices.
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