EC wants global rules to avoid energy crisis: Piebalgs
London (Platts)--12Jan2006
The European Commission supports global rules to govern behavior in the
energy sector, European Union energy commissioner Andris Piebalgs told an
industry seminar in Brussels late Wednesday.
"We clearly face a major crisis in the energy sector without global
rules," he said. "If we don't agree rules, for example in the G8, we will end
up with a very bad scenario." This might even be worse than the "flags"
scenario modeled by Anglo-Dutch energy major Shell in its global scenarios to
2025 paper presented at the same seminar, said Piebalgs. In this paper,
published last summer, Shell described three situations: low trust
globalization, "open doors" and "flags." The first would be a legalistic
"prove it to me" world, the second a pragmatic "know me" world and the third a
dogmatic "follow me" world. The differences in the resulting global GDP growth
ranged from 3.8% under "open doors" to 2.6% under "flags," according to
Shell's modeling.
"The EC is going for the 'open doors' scenario," said Piebalgs, "but
preparing for low trust globalization and fighting the 'flags' scenario.'
Shell modeled "open doors" as a world of regulatory harmonization, mutual
recognition, voluntary best practice codes and close links between investors
and civil society, all encouraging cross-border integration. Low trust
globalization would be characterized by rapid regulatory change, overlapping
jurisdictions and conflicting laws leading to intrusive checks and controls,
which would encourage short-term portfolio optimization and vertical
integration, said Shell.
"Flags" would involve dogmatic approaches, regulatory fragmentation,
national standards and conflicts over values and religion, all putting a brake
on globalization, said Shell.
"The 'open doors' scenario is the only one which guarantees security and
stability for the world's citizens," said Piebalgs. "It's definitely our final
goal." Examples of the EU's work toward this include the international climate
change negotiations, he said, and the formal dialogues with key energy
producing or transit countries such as Russia, Ukraine and Turkey, and with
Opec. "Energy is always on the agenda in our external relations," he said.
The EC is also working on a common EU energy policy, after EU leaders
agreed last October at an informal summit in Hampton Court, near London, that
energy is an area where more must be done at EU level. "This should be like a
common security policy," said Piebalgs, "and not like the common agriculture
policy... The aim is to create an EU energy policy where each member state
understands that each member state's policy influences each others', but that
EU policy influences world policy."
Former Swedish Prime Minister Carl Bildt told the seminar that the era of
cheap energy was over. "We've been living in a fool's paradise where energy
has been off the political agenda," he said, with politicians afraid to tackle
issues such as nuclear power. But increasing competition for energy resources
would influence EU policy "profoundly" and force a new political debate, he
said.
For similar news items, request a free trial to Platts EU Energy at
http://www.platts.com/Request%20More%20Information/
Copyright © 2005 - Platts
Please visit:
www.platts.com
Their coverage of energy matters is extensive!!.