EU Wants More Oversight Of Energy Deals

BRUSSELS — The European Commission is proposing that it should have the power to supervise European Union member states’ energy agreements with third countries.

The commission argues that such a move is necessary in a bid to make the EU speak with one voice on energy matters and to achieve greater transparency in bilateral deals struck with countries such as Russia. 

But the proposal unveiled on September 7 is likely to face fierce resistance from individual EU countries who will be loath to give greater powers to Brussels to oversee lucrative energy deals.

The European Commission argues that a more coherent EU energy policy is necessary as the share of imported energy is expected to rise in the coming years.

Eighty percent of all oil used in the EU is currently imported from outside as well as 60 percent of its gas.

‘One Voice Carries More Weight’

EU Energy Commissioner Gunther Oettinger stressed that it was necessary to create what he called “a comprehensive strategy for the EU’s external relations in energy” to avoid member states falling out with each other when striking deals.

“With one interest and with one voice we carry a completely different weight,” he said. “Then it becomes much harder for the other side to play at divide and rule.”

Oettinger is therefore suggesting the creation of an “exchange mechanism for intergovernmental agreements in the field of energy”.

This means that member states should send all agreements struck between them and third countries to the European Commission — even though confidential documents relating to the commercial side of the activity will not be shared with other governments.

Although the commission can’t veto a deal, it can challenge a contract in the European Court of Justice for breaking competition rules on the EU’s internal market.

Oettinger noted that contracts already agreed with third parties will stand. This is meant to allay fears of countries such as Italy, which has concluded several controversial deals with regimes in North Africa in recent years.

EU Energy Commissioner Guenther Oettinger
The proposal also suggests that officials from Brussels might participate as observers and advisors during the negotiations of energy contracts — a decision that many member states could conceive as a step too far by the European Commission.

There are also questions about whether countries will accept another proposal which envisages that the European Commission should be able to conclude its own deals on behalf of the European Union when it comes to energy infrastructure. Oettinger pointed out that the EU could play a role in negotiating the trans-Caspian pipeline between Azerbaijan and Turkmenistan.

Small States Would Welcome More Transparency

The commission believes that member states should accept the proposal. The EU executive points to a European Council conclusion, adopted by all 27 EU member states earlier this year, in which the governments invited themselves “to inform from 1 January 2012 the commission on all their new and existing bilateral energy agreements with third countries” so that the commission could make the information available to all other member states “in an appropriate form.”

A commission official also pointed out to RFE/RL that a notification procedure is already applicable to gas agreements, but several member states with large, multinational energy companies are likely to dismiss a proposal that would give the European Commission more powers.

A council source told RFE/RL that smaller member states would welcome more transparency in energy deals. But it seems unlikely that countries jockeying for profitable oil contracts with Libya’s new government would be keen to have EU observers around the table, the source said.

Oettinger was, however, hopeful that Poland, which currently chairs the rotating EU presidency, could manage to get national governments on board by the end of this year:

“I am hopeful that the Polish EU presidency will take a big interest in this proposal,” he said. “We have had good cooperation with them and we hope that they will push for a quick ratification of it in the [European] Council.”

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