Baltic gas grid causes rift in negotiations

Date: 09/11/1995

By Fiona McHugh

THE creation of an EU-wide web of electricity and gas networks is likely to be delayed by several months as a result of a difference of opinion between energy ministers and MEPs.

Two changes made by the European Parliament to a report laying down the ground rules for the so-called energy trans-European networks (TENs) have been deemed unacceptable by the Council of Ministers. Formal negotiations between the two bodies now seem inevitable.

These conciliation talks are likely to last at least six weeks, dashing the Spanish presidency's hopes of getting a number of 'common interest' projects up and running by the New Year. “Time is against Spain, because even if the two institutions reach an agreement in record time, the Council still has to wait for the Parliament to endorse the conciliation result. That will take time,” commented one diplomat.

Ignoring the European Commission's protests, MEPs voted two weeks ago to add a Baltic gas grid to the EU's list of priority projects.

But the Council is now refusing to agree to this addition. Sweden and Finland, which are on the brink of a radical overhaul of energy policy in the region, are vehemently opposed to the grid which they say, if prematurely launched, might clash with future energy plans.

Parliamentarians, irked by the peripheral role accorded them in the revision procedure, are also insisting that future changes to the list of projects be approved jointly by the Parliament and the Council.

But ministers are unhappy with the idea, claiming it would make any attempt to alter the list a cumbersome procedure. It wants revisions to be decided by a committee of national experts.

Mostly financed by private capital, the energy TENs will nevertheless receive 16 million ecu in 1995 and 25 million ecu in the following four years from the EU. That money will be mainly spent on feasibility studies aimed at establishing the economic viability of proposed projects.

Energy projects should, according to the EU, develop the internal energy market, improve security of supply or contribute to the bloc's economic and social cohesion.

The TENs were first mentioned in the Maastricht Treaty, but the concept was not fully developed until former Commission President Jacques Delors published his White Paper on Growth, Competitiveness and Employment in 1993.

In the White Paper, Delors put forward persuasive arguments for launching giant trans-national energy, telecommunications and transport networks just as national state-owned monopolies were coming under fire from the EU's competition wing.

He insisted Europe needed to stick together if it wanted to compete in the next millenium.