Innlegg – the Energy Union Conference

Riga, Latvia. 6. februar 2015

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Vice President, Commissioner, Colleagues, Ladies and gentlemen,

I am very pleased to be present here today and express Norwegian views on the Energy Union.

This morning I submitted a position paper to Vice President  Sefcovic. I will briefly mention a few key points from our side:

I have noted with satisfaction that the strengthening of the already good partnership between the EU and Norway is discussed under the Energy Union concept.

Norway and the EU are already close energy partners. Annually, Norway exports more than 100 billion cubic metres of natural gas to the EU through pipelines. We participate in the Emissions Trading System, and cooperate closely – and more and more so – on Carbon Capture and Storage.

Since the early 1990s, Norway has also been part of the internal energy market through the EEA Agreement. We are now in the phase of implementing the third energy market package.

Norway is fully integrated in the Nordic electricity market. This close integration of the Nordic electricity markets has been, is, and will remain to be of great benefit for all countries involved.

Interconnectivity is crucial for the functioning of the internal market. Norway has a level of electricity interconnection well above 15 percent of installed generation capacity. The planned interconnectors to Germany and the UK will increase Norway’s interconnection capacity by almost 50 percent.

Norway is not only a large producer of gas, but also a large producer of renewable energy. We have a renewables share of around 65 % percent in the energy mix. Almost 100 % of our electricity production is based on renewable resources.

Our ambition is to increase the production of renewable energy. This will give a contribution to more renewable energy in the European energy mix.

Improving security of supply is important – for exporting as well as importing countries.

Well-functioning and effective energy markets – with adequate infrastructure and an effective legislative framework – is a precondition for security of supply, and for developing an effective climate policy in Europe.

Important work is done to facilitate well-functioning markets, but we should try to achieve this without overregulating the market.

By replacing more CO2 intensive energy sources, gas can deliver large and cost efficient emission reductions. Being a flexible energy source, gas can also provide balancing in a system where the share of intermittent renewable energy is increasing.

We therefore believe that gas has an important role to play in Europe in many years to come. But as the consumers need security of supply, producers need security of demand.

Upstream projects and pipelines are huge, capital intensive projects. Additional investments upstream, and in gas export infrastructure, are hence dependent on expectations on future market development. This includes the market signals for gas in Europe from EU energy policy.

A possible mechanism for joint purchasing of gas would be a step in the wrong direction. It may reduce competition in the market and runs contrary to the liberalisation of the energy market.

Energy efficiency measures are important, as they contribute to improved security of supply, competitiveness and reduced emissions. An ambitious policy on energy efficiency should be based on domestic action adapted to national circumstances and comprehensive assessments of costs and benefits.

A new governance system is discussed as a follow up to the Climate and Energy Framework towards 2030. Generally, Norway thinks that reporting systems should have a light touch and should not imply heavy administrative burdens.

Research and innovation is essential to reduce costs and bring to the market innovative technologies that will enable the transition to a secure and competitive low emission energy system. Norway looks forward to cooperate with the EU within the framework of Horizon 2020, also on energy issues.

Carbon Capture and Storage should have a prominent role in the Energy Union. There is a need to develop a European CCS strategy to enable commercial development of CCS both for the power sector and the industry.

Last but not least – on the decarbonisation topic our main view is that the EU Emissions Trading System (ETS) is a cornerstone in the climate policies both of the EU and Norway. The cap must be sufficiently tight and predictable to bring about an efficient transition to a low-emission future.

I am looking forward to participating in this important debate on the Energy Union, and the choices of energy policies in Europe ahead of us – both here today, and in the coming months.

And let me finish by assuring you that Norway is – and will remain – an energy partner for the European Union!

Thank you for your attention!

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