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EUROPEAN ACADEMY OF THE REGIONS PRESENTS: CHALLENGES TOWARDS A COMPREHENSIVE ENERGY POLICY BEIRUT, 07.03.2017 Presentation EAR-AER Dr. Stephan Ressl Member of the Board EAR-AER aisbl EAR/AER’s mission The aim of the European Academy of the Regions / Académie européenne des Régions is to promote the idea of regionalisation and of regional action as a tool for employment and wealth creation. EAR-AER promotes and defends the autonomy of regional and local authorities and their right to have adequate financial resources to enable them to exercise their responsibilities. The organization supports cooperation between regional and local authorities of the Member States, neighboring States and third countries. Presentation EAR-AER 2 WHAT IS REGIONAL APPROACH? • supranational approach: • energy and water supply, • fight against pollution, • medical research and development, • … • subnational approach: • Homogenizing forces of globalization endanger the local knowledge, relationships, and regionally diverse cultures that once connected people and place require a specific approach, which often differs from the national policy Energy: decentralised, more and more sustainable, more individualised, higher resilience, ultimate security of supply. Regional Approach - Louis Delcart 3 ENERGY POLICY: CHANGING TIMES • Climate change, economic globalisation and asymmetric population growth change also energy needs • “Old” heavy investment cycles too long for changing environment (exceptions: Hinkley Point,..), old system failed to avoid climate change • “New” lower magnitude of investments (e.g. RES, efficiency,..) are more flexible and adaptable to (local) needs, but you need more • New type of investors interested in local investments (pension funds, citizens, ..), the consumer more involved • Side effect: increase of power and autonomy of the “small” • Side effect: very low pre-visibility for infrastructure needs • -> currently a somewhat messy situation in EU Regional Approach – Energy Policy 4 GLANCE AT EU ENERGY POLICY • The EU has adopted a vision of decarbonised economy and committed itself in COP21 • EU is not one country or a block but a multitude of MS with diverse interests – progress slow • Globalised industry needs competitive energy and citizen decent service • Progress in data processing and communication and technology opens new business in local and regional level – faster, more flexible • New proposal for holistic approach seems well targeted, but to be seen.. Regional Approach – Energy Policy 5 CHALLENGES TO A COMPREHENSIVE ENERGY POLICY • Worst thing: lack of clear vision by policy makers • 2nd worst thing: changing of “clear” vision every few moments • 3rd worst thing: the citizens do not share the same vision as the policy makers • And more questions arise: • Society: Elite driven versus bottom-up driven • Market: Monopolistic, static and foreseeable versus “atomistic”, efficient and volatile setting, who is allowed to participate? • Technical: technologically proven but inefficient versus higher forecast uncertainty and heavy investment challenge • Financial: how and who to finance change (especially if it is not clear that the change will not be changed again before investment returns) Regional Approach – Energy Policy 6 CONCLUSION: HOW TO MANAGE BEST TRANSFORMATION AND INNOVATION • Establishing an energy strategy is a process, starting with a vision and best inclusive with stakeholders(e.g. green book, white book, legal transposition of result etc..), including also transport and heating and cooling • Indigenous hydrocarbons is not the answer to all, although nice to have if managed well (de-politized Sovereign Wealth Fund,…) • The integration of new elements (energy efficiency (building insulation…), RES, demand response, smart grids, …) is secure, fast, reliable and rather cheap on lifetime calculation, 30-50 % RES penetration possible within 10 years • Much of the new approach comes with innovative financing models • The clean energy and climate sensitive view present a valid add on to the fossil fuel only energy regime • Low capitalised, new entrepreneurs can enter and prosper in decentralised energy markets, creating local jobs and added value • ESA incubator (or via a new smart academy) could also foster start-ups in energy (financing), creating local knowledge and wealth, exporting this then to Middle East and abroad.. Regional Approach – Energy Policy 7 Thank you very much Q+A [email protected] Regional Approach – Energy Policy 8