Following three successful ‘29+1’ Energy Symposia, in Budapest (2012), Vilnius (2013), and Bucharest (2014), we came together for the fourth time with EU Commissioner Günther Oettinger in Warsaw to discuss matters most relevant to the energy and energy - intensive industries.
As representatives of companies in this sector from Central Europe, we welcomed the opportunities provided by the ‘29+1’ Summit in Warsaw, where—in the context of the technological innovation in and the digitization of the energy industry—we considered the ambitious plans for a European Energy Union, with a particular emphasis on the role of the North-South Corridor.
We are convinced of the need for a thorough and intensive public debate that can help actively shape these plans. However, we need to focus on Central European states and assess their possible impact on the European economy, including the development of industry, competitiveness, and the security of supply.
As participants in the Summit, we entered into a comprehensive exchange of findings and views with the European Commissioner for Digital Economy and Society, Mr. Günther Oettinger, and consider the following to be of utmost importance for further debates by the Council of the European Union, the European Parliament, and the European Commission:
1. Energy constitutes the backbone of the European economy. Still, integration in this field is not keeping pace with the increasing interdependence of our economies. Insufficient technological innovation and infrastructural connectivity are a special burden on Central European countries. Only the creation of an Energy Union and the integration of energy and digital networks, through the completion of a single European market, will ensure that the European Union can remain globally competitive while pursuing its goals of energy security, affordability and environmental awareness.
2. For the completion of the internal energy market, Europe needs to abolish “energy islands” by improving and digitally integrating the infrastructure necessary for the transportation and trade of gas, oil and electricity between member states and Energy Community Contracting Parties through the development of the North-South Corridor and expanding the network of West-East connections.
3. The North-South Corridor, which is considered to be a critical infrastructure project of common interest under the Juncker Plan, is essential if we are to firmly and cost-efficiently interlink Central Europe’s energy and digital infrastructure between the Baltic, Adriatic and Black Seas, and connect it with Western Europe. This will promote the participation of the region in the future global economy while improving the capacity of our countries to deal with cyber-threats.
4. The Energy Union has more than a technical role to play—it will also strengthen the idea of energy solidarity within the European Union and thus enhance the energy security of Europe.
5. Issues related to the climate and environment remain an essential part of European policy. They need to be balanced against economic policies that sustain development. While CO2 reduction targets are necessary, these policies need to take financial and societal costs into account and be implemented at a global level. Affordable and competitive energy prices should be achieved through the implementation of a sustainable and climate-friendly economy based on a reasonable energy mix consisting of affordable indigenous energy sources, including fossil fuels.
6. The European Energy Union, and the North-South Corridor in particular, represent critical infrastructure that maximizes the benefits of the Trans-Atlantic Trade and Investment Partnership (TTIP) and thus offers Europe an additional diversification option for its energy supply.
7. The price of energy remains essential for both Europe’s international competitiveness and a return on investment (ROI) that incentivizes infrastructure development through market mechanisms. In relation to the United States, it is essential for Europe to assert itself in this domain. The most effective path in doing so is undergoing a digital transformation.
8. Digital transformation and technological innovation in the energy industry can bring a major improvement in structural growth conditions in Europe, without putting an additional pressure on prices. Innovative technology and gains in efficiency can help reduce costs and increase the competitiveness of European energy and energy-intensive businesses.
For this purpose, the development of energy infrastructure, and the expansion of digital communication networks is essential.
9. Emerging smart grids and smart cities represent an energy-digital symbiosis. They already offer consumers countless benefits with many more to come. For businesses and economies, they can promote innovation and reclaim Europe’s competitive edge in both the energy and digital sectors worldwide, while spurring economic growth and job creation. We should not allow digital technology in this field from non-EU countries to crowd out European products. Promoting the digital management of energy is the key to increasing efficiency.
10. While the digital transformation has bright prospects in the energy sector, technological innovation needs to be carefully evaluated, based on its merits, and implemented according to its commercial value.
Our future economic development rests on the implementation of a capable energy and digital infrastructure; the eradication of the existing shortcomings along the North-South Corridor needs to become a priority in order for the region not to be deprived of growth opportunities on the global marketplace. Therefore, we welcome the establishment of the European Fund for Strategic Investments, which, within the next two years, will disburse 315 billion euros in additional investment into a competitive, secure and sustainable energy infrastructure, among other things.
We propose the establishment of a North-South Corridor Platform aimed at bringing together the relevant actors, in a setting suitable to develop solutions for the most pressing financial and project implementation issues, while promoting a regulatory environment that facilitates investment in the corridor and makes it a main pillar of the Energy Union.
By: Paweł Olechnowicz
Chairman of the Board of Directors
Central Europe Energy Partners
June 16, 2015