Speech by Prime Minister Mirek Topolánek: “In Search for Security of Energy Supply of the EU Member States on the Common Electricity Market”, Ostrava
Welcome to Ostrava. It is no coincidence that we are holding a conference on the common electricity market in this very region in the course of the Czech Presidency. This region is located on the border of three EU Member States – the Czech Republic, Poland and Slovakia. The development of the region has always depended on cooperation with its neighbouring countries; whereas the key role was played by coal as an energy resource. The mutual dependence and interconnection can serve as an inspiration for the pan-European debate on energy security.
Energy security is a legitimate focal point of our attention. No living organism can live without energy. Without it, the civilisation structure quickly falls apart. Our freedom is also dependent on energy, as the past weeks harshly reminded us. The issue of transit and diversification of energy resources was addressed three days ago at the Nabucco summit in Budapest. Today’s conference has different topics. However, these topics cannot be separated from our excessive dependence on import of crude oil and gas.
Sufficient production capacity, a solid transmission network and adequate rules for the common electricity market – those are the topics of this conference as well as necessary conditions for reaching our goals: to provide a secure, inexpensive and stable energy supply to our citizens. Compliance with these conditions will enable us to make the best possible use of our own resources, thus lessening our dependence on imports. Compliance with these conditions calls for viewing the European electricity market as a technological unit, which in turn increases the awareness of the need for a common energy policy.
This conference will be attended by a number of brilliant experts. I certainly do not wish to predetermine the outcome of your debate. I would just like to pose a few questions and proposals which I consider important and the answers and solutions to which, I hope, will be formulated at your meeting.
As the title of the first part of the conference suggests, a common electricity market cannot function very well without sufficient production capacity. This is a great European weakness and the reason why the price of electricity is not decreasing on the liberalised market and why, on the contrary, it kept increasing up until the beginning of the crisis.
Therefore it is important to ask: How can we appropriately supplement the sources of electricity? What primary sources should we rely on in the future to secure our independence in electricity production? How can we harmonise our efforts to decrease emissions with the necessity to decrease our energy dependency? What should be the role of nuclear energy, domestic coal and imported gas?
All these issues relate to the topic of the EU common energy policy, namely the security of energy resources and their utilisation for production of electricity and heating. Without a common energy policy the common market will remain only a concept, European solidarity will become a cliché and energy security will be just a chimera.
Changes in the legislative framework that will enable faster development of new resources and transmission lines must be a part of the European policy. Only the combination of sufficient resources and high-quality and sufficiently extensive and functionally interlinked transmission networks will enable secure and stable supplies to the consumers and efficient operation of the common European market.
This brings us to the second part of the conference. We all remember vividly the black-outs or situations bordering on black-outs when the existing transmission networks were failing.
Are we prepared to solve this problem resolutely and quickly before many European households experience, at least temporarily, the “dark ages”? How are we going to deal with the fact that we have created a common European market, yet it is a sum of networks that are being built predominantly for the national demands and use, which is for the most part reflected in their technological level? When are we going to remove the “bottlenecks” of the system that obstruct the truly free trade and the operation of a pan-European electricity market?
I must say that I fully support the intention of the European Commission to strengthen the energy systems within the framework of the Recovery Plan. I appreciate the fact that the European Commission approved 3.5 billion euro for the development of the energy sector, the majority of which will be devoted to the improvement of networks between the Member States. Wind power plants are a major problem, especially in Germany, because they endanger the stability of the transmission networks. The rule should be that if someone loves wind power plants, they should also install new distribution lines as well as back-up resources to balance fluctuations in output.
A uniform tariff for cross-border transmission of electricity poses a specific yet incredibly important problem for European legislation. You will certainly address this proposal. The present situation, when international transmission is explicitly free and the operators of the transmission networks are subsequently compensated for the costs that have arisen, is against common sense. The Czech Presidency would like to address this issue, among others, within the framework of the discussion on the third Liberalisation Package.
That brings me to the third part of the conference, the rules and institutions of the common energy market. I am glad that a network of transmission system operators for electricity (ENTSO – E) has been formed. They intend to coordinate the rules on EU level and develop technical codes for running the network. I believe that this will soon remove the last technological barriers for creating a real European market.
Another useful step is the establishment of the new Agency for the Cooperation of Energy Regulators (ACER) which will develop trading codes. We are about to hear more about ACER here.
Concerning the Czech Republic, I can say that our market for electricity was fully opened on 1 January 2007, i.e. six months before the EU directive demanded it. Final consumers can switch to other suppliers of electricity, which they are now beginning to do. Unfortunately, I have to add that when it comes to Czech consumers, the opening of the market has so far had rather negative effects because the shortage of electricity in Europe has actually lead to higher prices.
Finally, I would like to answer three fundamental questions.
Do we want to give our citizens cheaper electricity and heating? If so, we cannot gamble on sources which produce them at a higher price.
Do we want to strengthen our freedom and independence? If so, we cannot rely to so large an extent on imported oil and gas.
Do we want sustainable energy with low emissions? If so, we cannot do without nuclear energy.
Such a harshly worded conclusion may exceed my mandate as leader of a coalition government. Nevertheless, I felt that I needed to be absolutely frank with you, not only as a man who has worked in the energy sector all his professional life, but also as a politician with a sense of responsibility for the future.
Thank you for your attention.
Last update: 16.8.2011 15:48
