EU needs to shake up energy markets: Draghi report

: Electricity, Emissions, Natural gas
24/09/09

The EU should take measures in energy markets that are "dominated by vested interests", including antitrust investigations, a report from former European Central Bank president Mario Draghi found today.

The call came as part of Draghi's report into the EU's future competitiveness, which was requested last year by European Commission president Ursula von der Leyen. It identified cost-efficient decarbonisation as a major challenge, and said the bloc must focus on accelerated innovation and growth and overcome geopolitical dependence and vulnerability.

The report, which runs to more than 300 pages, says the EU should carry out antitrust investigation into electricity and gas markets, and into energy imports, to deter "anti-competitive behaviour and tacit collusion" among companies, it said.

There should be a common maximum level of energy surcharges in the EU covering all energy taxes, levies and network charges, the report found.

Draghi — a former Italian prime minister — put forward specific proposals for energy markets including the development of an EU-level gas strategy, progressively moving away from spot-linked sourcing and increasing EU bargaining power, and reinforcing long-term contracts. He argues for decoupling inframarginal generation from natural gas prices through long-term power purchasing agreements (PPAs) and contracts for difference (CfDs).

Draghi wants compensation mechanisms for offering flexibility on markets as well as joint purchasing of energy in addition to demand aggregation. Other ideas tackle speculative behaviour via position limits and dynamic caps as well as an EU trading rule book with "an obligation to trade in the EU".

A further proposal is a review of a so-called "ancillary activities" exemption, under EU financial regulation, whereby non-financials, typically energy, firms can trade energy derivatives more freely without being authorised as investment companies.

Speaking alongside Draghi today, von der Leyen noted the need to shift away from fossil fuels and support industry through decarbonisation, also by bringing down energy prices. Draghi's report noted the difficulty of cutting emissions in hard-to-abate industries, as well as in the transport sector.

Planning is crucial, the report noted. For industry, it recommended "a mixed strategy that combines different policy tools and approaches for different industries", importing some "necessary technology" while ensuring the bloc retains some manufacturing capacity.

It called for "a joint decarbonisation and competitiveness plan where all policies are aligned behind the EU's objectives."

Von der Leyen did not react to specific proposals put forward by Draghi, and she is not obligated to act on the report's proposals.

By Dafydd ab Iago

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25/06/20

Brazil's carbon market rulemaking could pick up

Sao Paulo, 20 June (Argus) — Regulations required to put Brazil's regulated carbon emissions market into force have advanced slowly since congress passed legislation in late 2024, but this year may speed several key pieces. The government plans to gradually implement the market by 2030, even as it prepares to host the Cop 30 climate summit in Belem, Para state in the heart of the Brazilian Amazon in November. So far this year, the working group responsible for issuing the regulations that will govern the new market has met 20 times. Participants in the working group include representatives from 10 government ministries, but the finance ministry is spearheading regulations. A first round should be ready by July, the ministry said this week. The working group could define several elements in coming weeks, including clarity regarding the creation of the new agency that will oversee this market. The law stipulates that this new entity have its own technical staff and be independent from the government. "We urgently need to know who is going to be in charge of this market," Guilherme Lefevre, the director of the Getulio Vargas Foundation's sustainability center said, adding that the market needs to have a strong regulator to have credibility. For the market to move forward, Brazil also needs to create a national system for monitoring, reporting, and verification of greenhouse gas emissions. "Brazil still does not have this system, which is fundamental for the development of the regulated carbon market," Lefevre said. This system will underpin the national emissions allocation plan, which will grant companies emission quotas, which can be traded. The law requires companies that emit over 10,000 metric tonnes (t) of CO2 equivalent (tCO2e/yr) to report their emissions and companies with over 25,0000 tCO2e/yr in emissions to participate in the cap-and-trade system that will go into effect when the new carbon market begins operating completely in 2030. "So far, roughly 600 companies have reported their emissions and a total of around 5,000 companies will need to do so to comply with the market requirements," Laura Albuquerque, chief climate officer at Future Climate consultancy said. She added that that while companies in some sectors, such as steel and pulp and paper are already more prepared for the market, others are behind and are working to understand the extent to which the new market represents a risk or an opportunity. The government is also in a race against time to show progress towards creating the new market ahead of the November Cop 30 meeting, when it plans to launch an initiative that will integrate the Brazilian carbon market with markets in the EU, China and California. The goal is to use this coalition of carbons markets as a test case for a future, global carbon market. Not a silver bullet While the creation of a regulated carbon market is an important element of Brazil's decarbonization efforts, it is only part of the plan to meet its emissions-reduction targets. Compared with other countries, industry represents a small share of total emissions. In 2023 — the most recent year with available data — non-agricultural industry only accounted for just 4pc of Brazil's total emissions. Still, because the law permits companies on the regulated market to purchase a share of their credits from the voluntary market, tropical forest protection and restoration projects will also benefit. With Cop 30 leadership pushing for the next gathering to put into effect what has been agreed at previous summits, Brazil will likely feel pressure to advance more quickly on his own initiatives. Brazil's CO2 equivalent emissions by sector, 2023 mn t Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Pakistan loses EU GSP+ ethanol status

25/06/20

Pakistan loses EU GSP+ ethanol status

London, 20 June (Argus) — The European Commission today suspended Pakistan's Generalised Scheme of Preferences Plus (GSP+) status for imports of ethanol. The removal is effective from today, 20 June. A request was lodged in May last year by France, Germany, Spain, Italy, Hungary and Poland, who sought to activate Article 30 of the GSP Regulation, arguing that ethanol coming from Pakistan since 2022 has "caused a serious disturbance to the Union ethanol market". Under Article 30, the commission can "adopt an implementing act in order to suspend the preferential arrangement in respect of the products concerned". Pakistan was granted GSP+ status in 2014, and this expired at the end of 2023. The status was temporarily extended until 2027. The GSP+ grants reduced-tariff or tariff-free access to the EU for vulnerable low- and lower- to middle-income countries that, according to the EU, "implement 27 international conventions related to human rights, labour rights, protection of the environment and good governance". It fully removes custom duties on two-thirds of the bloc's tariff lines in Pakistan's case, including ethanol. Pakistan is a major supplier of industrial-grade ethanol to Europe, but it does not export fuel-grade ethanol. According to market participants, this is because production facilities in the country lack sustainability certifications such as the International Sustainability and Carbon Certification (ISCC) that are required for biofuels to qualify under the EU Renewable Energy Directive (RED) targets. Fuel-grade ethanol was not included in the bloc's measures. Several Pakistani market participants were hopeful the GSP+ status will remain in place, which has continued to support ethanol exports from the country to the EU ( see table ). But uncertainty has weighed on demand from Europe recently, suppliers said. A participant told Argus that Pakistani sellers may look to offer more into Africa to soften the drop in demand. Some European suppliers anticipated this outcome, and have already stopped importing from Pakistan. European renewable ethanol association ePure expressed concern about the decision to exclude fuel ethanol from the scope of the measures, noting this could open the door to unintended loopholes and weaken the overall effect of the safeguard efforts. By Evelina Lungu and Deborah Sun European ethanol imports from Pakistan Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Cop 28 outcome must be implemented in full: Cop 30 head

25/06/20

Cop 28 outcome must be implemented in full: Cop 30 head

London, 20 June (Argus) — The incoming UN Cop 30 summit president Andre Correa do Lago has set out his objectives for the conference in November, placing as a key priority the Cop 28 outcome of trebling renewables capacity and transitioning away from fossil fuels. Correa do Lago today said his plan is to drive "collective action" to tackle climate change, placing a strong emphasis on the global stocktake, the first of which was concluded at Cop 28 in 2023 . That outcome saw almost 200 countries commit to "transition away" from fossil fuels, as well as treble renewables capacity by 2030. The global stocktake, a five-yearly process, sets out progress made towards Paris climate agreement goals. Today's "Action Agenda must drive momentum towards the full implementation of the GST [global stocktake]", Correa do Lago said. The incoming Cop president is focusing on implementing agreements made at previous Cops, and ensuring that countries and all other stakeholders — such as sub-nationals and the private sector — work together to put the decisions into action. Correa do Lago's letter today repeated language from the Cop 28 outcome, and noted his other main themes for Cop 30, which will take place in Belem, in Brazil's Para state, on 10-21 November. As well as shifting energy, industry and transport from fossil fuel-powered to lower- or zero-carbon alternatives, he listed forests, oceans and biodiversity and agriculture and food as key topics. Further topics involved building resilience for cities, infrastructure and water and human and social development. A final priority was enablers and accelerators across the board, including for finance and technology. Correa do Lago said in May that Cop 30 should be a "pivot point" to action on climate change, and "a new era of putting into practice" what has been agreed at previous Cop summits. He has noted a difficult geopolitical situation , which could make talks more challenging. Brazil's Cop 30 presidency is also focused on climate finance at UN climate talks, currently underway in Bonn, Germany. These 'halfway point' discussions serve to cover substantial technical groundwork ahead of political talks at Cop summits each November. Brazil yesterday at Bonn presented a draft of a roadmap to scale up climate finance — from all sources — to $1.3 trillion/year by 2035. The roadmap will not be officially negotiated, although it was a key outcome from Cop 29 in 2024 and is likely to be finalised just ahead of Cop 30 this year. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

SEE gas operators propose changes to Route 1 product

25/06/19

SEE gas operators propose changes to Route 1 product

London, 19 June (Argus) — Gas transmission system operators (TSOs) in southeast Europe have proposed several changes to the "Route 1" integrated capacity product from Greece to Ukraine, including allowing nominations from the Greek virtual trading point (VTP) to count toward exports, subject to approval by the regulator. Route 1, a product offered only between June and October in order to help Ukraine reach its goal of importing roughly 5bn m³ of gas in preparation for the next heating season, bundles together capacity at the Kulata/Sidirokastro, Negru Voda/Kardam, Isaccea/Orlovka, Kaushany and Grebenyky interconnection points. The first monthly auction for Route 1 was held on 29 May , but no capacity sold at the auction as traders pointed toward serious questions over the product's compliance with EU law, a restrictive rule set and insufficient economic incentive to book. During a meeting with regional shippers today, the route's TSOs proposed several changes to the product. The most prominent change would allow nominations from the Greek VTP to count towards exports under the Route 1 product, which would increase the pool of eligible users if approved by the Greek regulatory authority. Under previous rules, Route 1 users would have had to cumulatively nominate at the Greek entry points of Agia Triada, Nea Mesimvria, Amfitriti and Kipi at least as much as they notify Greek TSO Desfa they intend to deliver to Ukraine, but this list explicitly did not include the Greek VTP or Kulata/Sidirokastro. These rules effectively heavily favoured users with LNG capacity at Revithoussa. The operators also clarified that Route 1 users will not be required to obtain a licence from Moldovan regulator Anre and conclude a balancing contract, as the gas will only be transmitted from one Moldovan interconnection to another. It is also not required to sign a balancing contract with Romanian TSO Transgaz, although it is necessary with Bulgartransgaz. The operators also clarified that interested parties do not need to have licences to trade in all five countries along the route, simply to be registered system users with access to transmission services for each of the TSOs. Although several market participants told Argus that even this process can take a month or longer. Other details of the product, such as the 25pc discount at all points except Isaccea entry, Kaushany exit and Grebenyky entry, where a 46pc discount is already applied by the Ukrainian TSO, remain in place. The operators do not appear to have addressed concerns raised by Energy Traders Europe that the offering of discounts on point-to-point capacity on a monthly basis is not in line with the EU's network code on capacity allocation (NC CAM). Traders today still expressed reservations about booking the Route 1 product, noting that the Greek discount to other competing routes into Ukraine is probably not large enough to justify booking given the cost of the tariffs. Argus assessed the Greek day-ahead price at a €6.70/MWh discount to the Slovak day-ahead market, the other most prominent underutilised route to Ukraine, at the most recent close. But at a cost of around €7/MWh for the Route 1 tariffs and volume fees, compared with a monthly Slovak exit tariff of €1.47/MWh and a volume fee of around €0.35/MWh, Route 1 would only marginally be in the money. Further, the 131 GWh/d booking from the Czech Republic to Slovakia for July , as well as a nearly correspondingly-large Ukrainian entry booking from Slovakia , suggests that traders intend to supply a large volume of gas to Ukraine along the main route competing with Route 1. Additionally, worries about the potential regulatory problems associated with Route 1 have not been addressed, leaving some firms uneasy, although all agreed that the potential inclusion of Greek VTP nominations would have a positive effect on potential interest. The next Route 1 auction will be held on the Regional Booking Platform (RBP) on Monday, with around 30 GWh/d on offer. By Brendan A'Hearn Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

BMWE legt RED III Entwurf vor

25/06/19

BMWE legt RED III Entwurf vor

Hamburg, 19 June (Argus) — Das BMWE hat Verbänden am 19. Juni einen ersten Referentenentwurf zur Umsetzung der RED III vorgelegt. Diese sieht grundlegende Veränderungen zur Erfüllung der THG-Quote vor. Erste Preisindikationen steigen schlagartig. Um die auf EU-Ebene gültige dritte Fassung der Erneuerbare-Energien-Direktive (RED III) in deutsches Recht umzusetzen, hat das Bundesministerium für Wirtschaft und Energie (BMWE) einen Entwurf zur Anpassung des Bundes-Immissionsschutzgesetzes (BImSchG) vorgelegt. Unter anderem sieht der Entwurf vor, die Treibhausgasminderungsquote (THG-Quote) bis 2040 schrittweise auf 53 % zu erhöhen (siehe Grafik). Das bisherige Ziel war eine Quotenhöhe von 25,1 % im Jahr 2030. Auch der Pfad bis 2030 wurde leicht angepasst. Damit käme das Gesetz, wenn es in dieser Form umgesetzt wird, einer vielgeäußerten Forderung der Biokraftstoffindustrie nach, die sich für eine stärkere Quotenerhöhung eingesetzt hat. Infolgedessen melden erste Marktteilnehmer Angebote für Andere Zertifikate für das Verpflichtungsjahr 2026 in Höhe von 175 €/tCO2e. Für dieselben Zertifikate für 2025 werden 125 €/tCO2e geboten. Zusätzlich enthält der Entwurf einen Mechanismus, der im Falle einer Übererfüllung die Höhe der Quote im übernächsten Jahr erhöht. Ausschlaggebend ist dafür, ob die gesamte Quotenerfüllung in einem Jahr bereits ausreichen würde, um die Quotenhöhe des Übernächsten Jahres zu erfüllen. Darüber hinaus sieht der Entwurf vor, die Option zur zweifachen Anrechnung von als fortschrittlich geltenden Biokraftstoffen abzuschaffen und die Mindestquote zu erhöhen. Diese steigt dann bis 2030 auf 3 %. Zuvor lag das Ziel bei 2,6 %. Viele Marktteilnehmer haben gemutmaßt, dass die Doppelanrechnungsoption entfallen würde, um die benötigte Menge an Erfüllungsoptionen zu erhöhen. Auch welche Kraftstoffe zur Erfüllung der Quote genutzt werden können wird angepasst: So können keine Kraftstoffe auf Soja- oder Palmölbasis zur Erfüllung genutzt werden. Letzteres schließt auch Kraftstoffe aus Nebenprodukten der Palmölproduktion, allen voran Palmölmühlenabwasser (POME) ein. Dieses wurde in der Vergangenheit insbesondere genutzt, um die fortschrittliche Unterquote zu erfüllen, da es dank einer Sonderklausel trotz seiner Einstufung als fortschrittlich nur einfach zur Erfüllung der THG-Quote angerechnet werden konnte. Diese Regelung würde direkt ab Inkrafttreten der Gesetzesänderung wirksam werden. Die Anrechnungsgrenzen für futtermittel- und abfallbasierte Kraftstoffe werden ebenfalls angepasst: Während das Limit für futtermittelbasierte Produkte bis 2030 von 4,4 % der in Verkehr gebrachten Energiemenge auf 3 % reduziert wird, steigt das Limit für abfallbasierte Produkte wie Altspeiseöl (UCO) bis 2039 von 1,9 % auf 2,8 %. Zusätzlich wird eine Mindestquote für erneuerbare Kraftstoffe nicht-biogenen Urpsrungs (RFNBO) eingeführt. 2026 beträgt der energetische Mindestanteil 0,1 % und soll bis 2040 auf 12 % steigen. Zu den RFNBOs gehören unter anderem synthetische Kraftstoffe wie eFuels (PtL, Power-to-Liquid) und Grüner Wasserstoff. Der Entwurf erweitert den Geltungsbereich der THG-Quote außerdem auf den Luftverkehr. Bisher galt hier eine gesonderte Quote für erneuerbare Kraftstoffe. Darüber hinaus unterliegt nun auch der Seeverkehr der THG-Quote. In der Seefahrt genutzte Kraftstoffe, die im Straßenverkehr anrechenbar wären, können hierbei jedoch nicht für die Erfüllung genutzt werden. Damit soll vermieden werden, dass Unternehmen die Erfüllung ihrer Verpflichtung komplett vom Straßenverkehr auf die Seefahrt umwälzen. Der Entwurf sieht außerdem vor, dass erneuerbare Kraftstoffe nur noch angerechnet werden können, wenn Vor-Ort-Kontrollen der Produktionsstätten durch staatliche Kontrolleure ermöglicht werden. Dies soll das Betrugspotenzial bei der Anrechnung von Biokraftstoffen mindern. Der Entwurf liegt nun den Branchenverbänden vor. Ein Mitglied des Umweltausschusses erklärte am 4. Juni im Rahmen einer Podiumsdiskussion, dass der Entwurf nach Anpassung an eventuelle Verbandsvorschläge im Oktober dem Parlament zur Debatte vorgelegt werden soll und idealerweise zum 1. Januar 2026 in Kraft treten soll. Der Referentenentwurf sieht vor, dass die Änderungen an der THG-Quote mit Beginn des neuen Verpflichtungsjahres in Kraft treten. Dies soll Marktverwerfungen verhindern, für den Fall, dass die Gesetzesänderung innerhalb eines Verpflichtungsjahres in Kraft treten sollte. Von Svea Winter & Max Steinhau Entwicklung der THG-Quote bis 2040 Senden Sie Kommentare und fordern Sie weitere Informationen an feedback@argusmedia.com Copyright © 2025. Argus Media group . Alle Rechte vorbehalten.

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