February EU Infringement Package: Signs of "Getting to 2014" in Completion of the Internal Energy Market?

Ensuring Implementation

Lithuania has now joined 10 other EU Member States that still have not communicated national measures aimed to transpose the provisions of the Electricity Directive 2009/72/EC and the Gas Directive 2009/73/EC under the Third Energy Package. Deadline for full transposition was 3 March 2011. (Reference: MEMO/13/122, 21.02.2013)

Lithuania received this February a reasoned opinion which is the second stage in the infringement procedure, after the sending of formal letter. In total, 15 Member States have received a reasoned opinion from the Commission on the matter. 6 of them have been referred to the European Court of Justice, which is the next stage of the infringement proceeding procedure (see press release of 24 January 2013, announcing that Bulgaria, Estonia and the UK had been referred to the Court by the Commission). For 5 of the original 15, the Commission decided to close the case. The press release from the Commission does not detail which transposition measures have not been notified to the Commission.

"Getting to 2014" ... ?

The European Commission is responsible for ensuring that EU law is correctly applied. By continuing the procedures of infringements, the Commission is also pursuing its objective of completion of internal energy market by 2014, an objective which has been politically set by the European Council in February 2011. The question is: Are the Member States going to reach the deadline?

In 2011, the European Commission in charge of Energy, Oettinger, already "observed with concern delays in its implementation". Things are moving, but not so quickly. Meanwhile, the 2014 deadline is still used as reference, as attested by the last Communication of the Commission "Making the internal market work" (COM(2012)663) :

"By 2014 the existing legislation needs to be implemented fully, including putting in place the essential technical rules of EU level, and providing regulators with necessary tools and resources to enforce legislation effectively." (p.2)

The Commission also noted that, as of November 2012, the EU was "not on track to meet the deadline".

Certain "challenges ... need to be tackled urgently" in order to try reaching the deadline. In the 2012 Communication, the Commission refers to the following forthcoming initiatives which are in progress or should be taken in 2013:

- pursuing infringement procedures, to ensure full transposition of the Third Energy Package

facilitate exchange of information between the Member States on key consumer issues, including price comparison tools, transparent pricing and billing, and concept of vulnerable consumers. By the adoption of the two recent infringement packages, the Commission is following this approach and showing determination, but the procedures are lengthy, and not able to ensure by itself completion by 2014.

- "press" public authorities in ensuring completion with concession rules for different kinds of facilities and infrastructures. This action is not really apparent for the moment. The Commission should assess "the adequacy of the existing regulatory measures" which are currently used, and the results of this assessment could well be used in forthcoming legislative proposals, and why not a fourth liberalisation package.

- promoting the virtues of regional initiatives following a bottom-up approach, and this together with ACER. See other post on this blog on ACER's report on the status of "Regional initiatives and the road to 2014."

- following-up the phase-out of regulated prices in favour of market-based price formation. Recent legal actions against some Member States indicate that this is still a strategy followed by the Commission.

- developing technical rules like network codes enabling the development of cross-border, wholesale markets or balancing markets in practice. ACER is also very active on this matter, in association with ENTSO. One can also mentioned the efforts back the REMIT Regulation for the supervision of wholesale energy trading, and where ACER again plays a central role.  

- issuing guidance on best practice in renewable energy support schemes and on support scheme reform. The Commission published two communications on the topic in 2012.

- issuing new guidelines on state aid for environmental protection, which will cover elements of renewable energy sources. The guidelines are indeed expected in the Spring.

- following the adoption and implementation of the Energy Infrastructure Package. The file is already well advance as regards legislative proposals: proposal for a regulation on Guidelines for trans-European energy infrastructure (advancing but still awaiting first reading) and Connecting Europe Facility

Annex I to the Communication contains a table summarising the timetable for adoption of these measures.

Some tasks must be initiated and/or followed up by national energy regulators and competition authorities, which is of course not under the direct control of the Commission, except in some competition cases of EU dimension.