ENERGY INFRASTRUCTURE TRANSFORMATION AS PART OF CLEAN ENERGY TRANSITION IN THE EU

This paper analyzes the co-movements of prices of fossil fuels, energy stock markets and EU allowances. This analysis is conducted in order to identify the spillover effect of volatility and correlation among these financial markets, and to provide a scientific basis that shows the interest of incorporating sustainable assets in the design of minimum risk strategies of investment. To achieve this goal, we have used a Vector Autoregressive-Dynamic Conditional Correlation-Generalized Autoregressive Conditional Heteroscedasticity (VAR-DCC-GARCH) model that also incorporates a stock index of industrial companies as a leading indicator of the level of economic activity. In addition, the paper conducts an impulse response analysis to determine how unexpected shocks to prices are propagated along time, and, in particular, how they affect prices of the others, both in mean, variance and correlation. Therefore, the results of this one- and two-dimensional analysis allow for the study of short and long run dynamics of the relationship among those prices, thus, providing greater meaning and information for investors, which has implications for building their portfolios. The analyzed period was from January 2010 to February 2021, so that the data include half of phase II, full phase III and the onset of phase IV of the EU ETS, as well as the COVID-19 outbreak in the European context. We also analyzed whether the EUA price impulses the demand of clean energy stocks, which has important implications for the objective of triggering the investment in clean energy. Our results show the transmission mechanism of all of those prices, which are relevant not only for investors but also for policymakers to construct an early-warning system, revealing the most important transmission channels. Moreover, from an investment viewpoint, we observe a decline in dirty energies and a rise in the clean energy market, which might be an indication of the progress towards the energy transition to renewables sources within a circular economy perspective. Therefore, this shows that the EU ETS is achieving its goals, and that clean energy companies, aligned with their role towards socially responsible initiatives, are also gaining acceptance in terms of investments, which would be beneficial for the environment.

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French Energy Sector in Search for Optimal Model

MGIMO Review of International Relations ◽

10.24833/2071-8160-2019-5-68-156-171 ◽

2019 ◽

Vol 12 (5) ◽

pp. 156-171

Author(s):

A. V. Zimakov

Keyword(s):

Power Generation ◽

Nuclear Power ◽

Nuclear Reactors ◽

Current Model ◽

Energy Transition ◽

Clean Energy ◽

Green Energy ◽

Electricity Production ◽

Low Carbon ◽

The Eu

Clean energy transition is one of major transformation processes in the EU. There are different approaches among EU countries to decarbonization of their energy systems. The article deals with clean energy transition in France with the emphasis on power generation. While this transformation process is in line with similar developments in the EU, the Franch case has its distinct nature due to nuclear power domination in electricity production there. It represents a challenge for the current model as the transition is linked to a sharp drop of nuclear share in the power mix. It is important to understand the trajectory of further clean energy transition in France and its ultimate model. The article reviews the historical roots of the current model (which stems from Messmer plan of the 1970-es) and its development over years, as well as assesses its drawbacks and merits in order to outline possible future prospects. The conclusion is that the desired reduction of nuclear energy is linked not solely to greening process but has a complex of reasons, the ageing of nuclear reactors being one of them. Nuclear power remains an important low-carbon technology allowing France to achieve carbon neutrality by 2050. A desired future energy model in France can be understood based on the analysis of new legislation and government action plans. The targeted model is expected to balance of nuclear and green energy in the generation mix in 50% to 40% proportion by 2035, with the rest left to gas power generation. Being pragmatic, French government aims at partial nuclear reactors shut down provided that this will not lead to the rise of GHG emissions, energy market distortions, or electricity price hikes. The balanced French model is believed to be a softer and socially comfortable option of low-carbon model.

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The Spanish Energy Transition into the EU Green Deal: Alignments and Paradoxes

Energies ◽

10.3390/en14092535 ◽

2021 ◽

Vol 14 (9) ◽

pp. 2535

Author(s):

José Antonio Peña-Ramos ◽

María del Pino-García ◽

Antonio Sánchez-Bayón

Keyword(s):

International Relations ◽

Fossil Fuels ◽

Fossil Fuel ◽

Energy Transition ◽

Clean Energy ◽

Renewable Energies ◽

Energy Relations ◽

Current Energy ◽

The Eu ◽

Do So

Climate change, clean energy transition, the energy security quest, and international relations have triggered the revival of renewable energy as a solution to these problems. Nowadays, there is an energy transition where renewable energies bring geopolitical changes in a world where fossil fuels are becoming less relevant. This article aims to assess how the transition influences Spain’s energy relations with other countries regarding electricity and its sources, in alignment with the European Green Deal. In order to do so, its current energy situation, the renewable energies development and its energy import-export relations are examined. The results show that despite progress in green regionalization through more electric interconnection, little difference is to be found in traditional relations with fossil fuel countries exporters, but more are the contractions in Spanish energy economic policy, as here is explained.

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Are We on the Right Track? Collective Self-Consumption and Energy Communities in the European Union

Sustainability ◽

10.3390/su132212494 ◽

2021 ◽

Vol 13 (22) ◽

pp. 12494

Author(s):

Dorian Frieden ◽

Andreas Tuerk ◽

Ana Rita Antunes ◽

Vasilakis Athanasios ◽

Alexandros-Georgios Chronis ◽

...

Keyword(s):

Renewable Energy ◽

Electricity Market ◽

National Level ◽

Energy Transition ◽

Clean Energy ◽

Energy System ◽

The European Union ◽

High Expectations ◽

The Right ◽

The Eu

To accelerate the energy transition, the EU “Clean Energy for all Europeans” package aims to strengthen the involvement of end consumers in the energy market. To this end, together with so-called “active consumers” and provisions for individual and collective renewable energy self-consumption, two types of energy communities were introduced. The EU framework, however, leaves many details of the transposition process to the national level. The corresponding directives were supposed to be transposed by the end of December 2020 (recast Electricity Market Directive, defining active consumers and citizen energy communities) and by the end of June 2021 (Renewable Energy Directive, defining renewables self-consumption and renewable energy communities). In this paper, we critically discuss major developments of the transposition, including questions of the general distinction of the different concepts, governance and ownership, physical expansion, administrative barriers and the overall integration of energy communities into the energy system. The analysis builds on country case studies as well as on previous work by the authors on the status of the transposition process throughout the EU. The paper shows that the national approaches differ greatly and are at very different stages. While basic provisions are in place in most Member States to meet the fundamental EU requirements, the overall integration into the energy system and market is only partly addressed. This concerns, for instance, the analysis of system impacts of energy communities and measures that would allow and support energy system-friendly behaviour. In addition, several practical hurdles need to be overcome. These often relate to administrative requirements such as complex registration and licensing procedures, the need for the involvement of several institutions, or difficult procedures for access to relevant data. The paper concludes that discussed barriers will need to be carefully addressed if the high expectations for the role of energy communities are to be met.

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Financial Aspects of the European Green Deal

Analysis and Forecasting. IMEMO Journal ◽

10.20542/afij-2021-4-13-23 ◽

2021 ◽

pp. 13-23

Author(s):

M. Strezhneva

Keyword(s):

European Union ◽

Energy Transition ◽

Clean Energy ◽

The European Union ◽

Economic Activities ◽

Public And Private ◽

Financial Decisions ◽

Environmental Objectives ◽

The Usa ◽

The Eu

The climate policy of the European Union became the key priority for the European Commission, headed by Ursula von der Leyen. This article analyses both its internal and external dimensions, while concentrating on the finances of the European Green Deal, the multiyear strategy for the EU socio-economic development. The methods are demonstrated which the EC employs to mobilize public and private capital for the realization of the green transit, including the financial instruments designed to assist businesses when investing in clean energy and industry. The notion of ‘sustainable’ investment is specified that Brussels is guided by when working out its financial decisions. The EU taxonomy, a green classification system that translates the EU's climate and environmental objectives into criteria for specific economic activities for investment purposes, is presented. The research reveals how the market and regulatory powers of the EU are brought to bear in rolling out its controversial Carbon Border Adjustment Mechanism. By means of this transnational taxation Brussels hopes to avoid carbon leakage: the situation that allegedly may occur if European carbon-intensive businesses were to transfer production to other jurisdictions with laxer emission constraints. Yet a lack of flexibility in applying the CBAM is causing concern in many countries of the world, including the USA, Brazil, South Africa and China. In EU-Russia relations in particular, it risks increasing political tensions and/or causing trade retaliation due to low levels of mutual trust. Russia developing energy transition plans of her own, her efforts in this respect are now visibly stimulated by the declared EU intention to externalize its regulatory practices. At the same time, Moscow perceives this externalization as an imposition which is most unwelcome and hurts Russia disproportionally. Presumably, the European Union could put more effort in negotiating and developing this latest European initiative with international partners to win new willing ears for it.

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Varying the Energy Mix in the EU-28 and in Poland as a Step towards Sustainable Development

Energies ◽

10.3390/en14051502 ◽

2021 ◽

Vol 14 (5) ◽

pp. 1502 ◽

Cited By ~ 1

Author(s):

Wiktoria Sobczyk ◽

Eugeniusz Jacek Sobczyk

Keyword(s):

Sustainable Development ◽

Alternative Energy ◽

Public Awareness ◽

Energy Transition ◽

Clean Energy ◽

Energy Sources ◽

Hard Coal ◽

Energy Mix ◽

Noticeable Increase ◽

The Eu

The demand for clean energy is a key global issue requiring global ideas to be implemented through local action. This is particularly important in Poland’s energy transition, since the country produces energy mainly from conventional sources, i.e., coal, gas, and crude oil. Adverse climate change caused by high emissions of the economy based on the combustion of hydrocarbons as well as the growing public awareness have made it necessary to look for new environmentally friendly energy sources. The aim of the paper is to demonstrate that the use of alternative energy sources, biomass in particular, is compatible with sustainable development policy. Eight indicators for the EU-28 and for Poland were analysed in order to verify the progress in modifying the energy mix between 2010 and 2018 in the context of implementing Sustainable Development Goals (SDGs). The analysis showed that both in the EU-28 and in Poland, the aggregated indicator taking into account the positive and negative change in the values of individual indicators improved between 2010 and 2018. In the EU-28, this indicator is higher (180.1) than in Poland (152.3). The lower value for Poland is mainly due to the fact that the main source of energy in Poland remains hard coal and lignite. However, the noticeable increase in recent years in the share of energy from renewable sources, biomass included, allows us to look with hope to a rapidly growing indicator measuring progress towards a sustainable development goal, and to improving environmental standards.

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Energy Transition Investments and Financing Instruments

Federalism ◽

10.21686/2073-1051-2021-1-100-114 ◽

2021 ◽

pp. 100-114

Author(s):

N. V. Bahtizina ◽

A. R. Bahtizin

Keyword(s):

Electric Vehicles ◽

World Economy ◽

Energy Transition ◽

Clean Energy ◽

Developed Countries ◽

Low Carbon ◽

Innovation Fund ◽

The Usa ◽

Low Carbon Technologies ◽

The Eu

International organizations representing the interests of energy-deficient developed countries are urging to solve the problem of global warming through the Energy Transition, which implies decarbonization of the world economy. The implementation of the Energy Transition requires annual investments of 3% of world GDP in energy efficiency, renewable energy, electric vehicles, etc. In 2020, despite the acceleration of dynamics, the volume of world investments was more than 5 times lower than required. The leaders in investments in clean energy are the technologically developed countries of Europe, the USA, Japan, as well as developing countries – China and Brazil, striving for technological independence. In order to expand its presence in the promising market for low carbon technologies, the EU pays special attention to innovations in the field of clean energy, financing them through the Innovation Fund. To prevent Russia’s technological backwardness and reduce the carbon footprint of export products, it is advisable to envisage the possibility of state support for innovative projects in the field of clean energy from the Climate Fund.

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Challenges, Concerns, and Perspectives for Poland's Energy Transition during Global COVID-19 Pandemic

Global Energy Law and Sustainability ◽

10.3366/gels.2020.0022 ◽

2020 ◽

Vol 1 (2) ◽

pp. 169-173

Author(s):

Andrzej Lorkowski ◽

Robert Jeszke

Keyword(s):

Internal Energy ◽

Energy Transition ◽

Energy Transformation ◽

Modern Times ◽

Current Discussion ◽

The Face ◽

National Governments ◽

The Eu ◽

At Home

The whole world is currently struggling with one of the most disastrous pandemics to hit in modern times – Covid-19. Individual national governments, the WHO and worldwide media organisations are appealing for humanity to universally stay at home, to limit contact and to stay safe in the ongoing fight against this unseen threat. Economists are concerned about the devastating effect this will have on the markets and possible outcomes. One of the countries suffering from potential destruction of this situation is Poland. In this article we will explain how difficult internal energy transformation is, considering the long-term crisis associated with the extraction and usage of coal, the European Green Deal and current discussion on increasing the EU 2030 climate ambitions. In the face of an ongoing pandemic, the situation becomes even more challenging with each passing day.

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Energy Policies at Crossroads − Will Europe's 2030 targets and framework be in line with the Paris Climate Agreement?

Renewable Energy and Environmental Sustainability ◽

10.1051/rees/2019001 ◽

2019 ◽

Vol 4 ◽

pp. 4

Author(s):

Rainer Hinrichs-Rahlwes

Keyword(s):

Energy Efficiency ◽

Clean Energy ◽

European Parliament ◽

New Governance ◽

Energy Policies ◽

Governance System ◽

Regulatory Frameworks ◽

Legislative Proposals ◽

Paris Climate Agreement ◽

The Eu

In November 2016, the European Commission presented the Clean-Energy-for-all-Europeans Package. It consists of eight legislative proposals which should define targets and policy and regulatory frameworks for the EU's climate and energy policies up to 2030 and beyond. Recasts of the existing Renewable Energies Directive and the Energy Efficiency Directive, as well as proposals for a new energy market design, which should be fit for renewables, are among the key elements of the package, which aims at replacing the existing 2020-framework. The package includes 2030-targets for Greenhouse Gas Reduction (at least 40%), Energy Efficiency (at least 27/30%), and the share of Renewables in Gross Final Energy Consumption (at least 27%). In contrast to the 2020-framework, the EU-wide renewables-target would no longer be underpinned by binding national targets but should be reached in a joint effort with a new governance system. Since the proposal was submitted to the European Parliament and the European Council for the legislative procedures which must end in an agreement before the next elections for the European Parliament in 2019, controversial debates are taking place. The intention is to finalise the legal procedures before the end of 2018. Parliament and Council had planned to decide about their respective opinions about the various pieces by February 2018. Afterwards, probably not finished before the end of 2018, compromise negations will take place, before the whole package will eventually be accepted by both bodies. Among the most controversially discussed topics is the ambition level of the proposals and whether or not it is in line with the commitments signed by the EU and all its Member States in the context of the Paris Agreement. Industry stakeholders not only from the renewable energy sector and environmental NGOs have proposed significantly higher targets in order to stay “well below 2 °C” of global warming before the end of the century. They also suggested continuing binding national targets or − as a compromise − enacting a very strict governance system. I shall present and evaluate the state of play of the 2030-framework decision process. And I shall end with some policy recommendation still to be considered in the ongoing debate.

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Retooling the Energy Charter Treaty for climate change mitigation: lessons from investment law and arbitration

The Journal of World Energy Law & Business ◽

10.1093/jwelb/jwab007 ◽

2021 ◽

Vol 14 (2) ◽

pp. 75-87

Author(s):

Elena Cima

Keyword(s):

Climate Change ◽

Climate Change Mitigation ◽

Energy Transition ◽

Clean Energy ◽

Careful Analysis ◽

Energy Trade ◽

Energy Charter Treaty ◽

Scope Of Application ◽

Modernization Process ◽

Change Mitigation

Abstract In 2017, the Energy Charter Treaty (ECT) began a modernization process aimed at updating, clarifying, and modernizing a number of provisions of the Treaty. Considering the scope of application of the Treaty—cooperation in energy trade, transit, and investment—there is hardly any doubt that the modernization kicked off in 2017 offers a springboard for constructive reform and a unique opportunity to bring the Treaty closer in line with the objectives of the Paris Agreement. Although none of the items selected by the Energy Charter Conference and open for discussion and reform mention climate change or clean energy, a careful analysis of the relevant practice in both treaty drafting and adjudication can provide valuable insights as to how to steer the discussions on some of the existing items in a climate-friendly direction. The purpose of this article is to rely on this relevant practice to explore promising avenues to ‘retool’ the Treaty for climate change mitigation, in other words, to imagine a Treaty that would better reflect climate change concerns and clean energy transition goals.

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