07 Nov 08 Eddie's Blog Global

Eddie O’Connor’s speech at the EUFORES Gala Dinner in Budapest

Dr. Eddie O’Connor, Chief Executive, Mainstream Renewable Power. Speaking to EUFORES, Budapest. 7 November 2008. Members of the European Parliament, ladies and gentlemen. It is a great honour for Mainstream Renewable Power to associate itself with the work of EUFORES. I salute you as the “European Parliamentarians for a Sustainable Energy Future”. I can think of nothing more important than ensuring the further deployment of renewable energies and energy efficiency. These are your stated objectives, and I subscribe to them fervently. That’s why I am here tonight as your host. I like the way you have geared yourselves for action. You have identified four basic challenges concerning today’s energy system. Or, putting it another way, dealing with four effects of our dependence on fossil fuels. They are: - Import dependency - Increasing prices and volatility - Climate change - Geo-strategic tensions caused by competition for scarce energy resources. Because you are action-oriented you have asked the one question that must be asked: “What needs to be done?” Your short, direct, but profound, answer is to promote renewable energies and energy efficiency within the European Union. Let me offer you some brief thoughts as to how that can be done. I start by asking myself the question Jean Monnet often asked himself before he decided on an important course of action. What is the one thing which, if I accomplish it, will change everything else? Applying that approach, I believe that the most efficient and effective way to deploy more renewable energy is to create a functioning Internal Market for all electricity, both brown and green. I say this because such a market would break down national boundaries which shield local monopolies – which invariably use coal, oil and gas to generate electricity. Utilities which are usually hostile to renewable energy. To get to a proper internal market we will need massive inter connection between 27 national markets. And we will need co-ordination between the national regulators, harmonization of grid codes and co-operation between grid operators. If we achieve these objectives then the electricity market would be transformed. Entry barriers would be broken down. Prices would reflect real costs – and would internalise the cost of carbon, as well as expressing the true value of wind energy, solar power, and ocean energy. But how can we get there? What is to be done? as you asked. I am reminded of Jacques Delors when he set about creating an Economic and Monetary Union immediately after the adoption of the Single European Act in 1987. He took a grand view of the challenge but, at the same time, he took a very focused view of those he should involve. He convened a meeting of all the central bank governors, turned them into a committee with an action programme and timetable. And he got them to agree on a consensus report which he then submitted to their governments. They had no alternative but to accept the recommendations. As a result, we created an Economic and Monetary Union, with a European Central Bank, and with common rules governing the conduct of the Member States budgetary policies. The result was the greatest pooling of sovereignty in peace time. We need to adopt the same approach in bringing about an internal market for electricity. It is the last great challenge set out in the Cockfield White Paper of 1985. It still remains to be accomplished long after the completion of Economic and Monetary Union, which many people would have thought far more difficult to achieve. What we need now is action oriented leadership. We need leadership and vision, like that displayed by Jacques Delors in the late 80’s. We need action in bringing the key people together, just like he did. In our case, what we need is leadership which brings together the Energy Ministers, the Regulators and Grid Operators and which leads to a massive interconnection programme. A programme that will be implemented within the space of a decade. And an Internal Market that will be regulated by a harmonized code of practice, something analogous to the Stability and Growth Pact agreed by Finance Ministers a decade ago. The achievement of the Internal Market would focus our minds on removing all the bottle necks which prevent sufficient Renewable Energy being deployed throughout the Union. The challenge is more formidable that we think, even now. This time next year it is virtually certain that the nations of this earth will agree to a global climate change package as a successor to the Kyoto protocol. If I am right, then the European Union will commit itself to a 30% reduction in its 1990 levels of Greenhouse Gas Emissions by the year 2020. This will be a truly formidable challenge to our joint capacity to make the once off transition from fossil fuels to renewable energies. I have no doubt, nor, has anybody here, I am sure, that these new targets will only be achieved by the massive and rapid deployment of renewable energy. And, let’s face it, ladies and gentlemen, that means the deployment of massive quantities of wind power. Wind power that is both on-shore and off-shore. That is why we need the Internal Market because it will be focused on removing all entry barriers and of simultaneously creating the conditions in which a real market can operate. I want to ask you, as parliamentarians, to devote your energies over the next twelve months to devising a programme for the creation of a European-wide Internal Market. There will be many national obstacles to overcome, not least the opposition of the entrenched monopolies. But, equally, there will be opposition at European level due to the failure of many to see this as a European problem. Above all we need the European Parliament to lead the way, as it has often done in the past. We are depending on your breadth of vision and your depth of expertise to come up with proposals that will convince both the Commission and the Council about what is to be done. I have no doubt that we can depend upon you with confidence and with certainty that you will succeed in this challenge. I want to thank you for attending this conference and for devoting your time to the objectives we share in common about the need for a sustainable future. For my part, I pledge my continuing support and unwavering commitment to this objective.