European electricity network breakdown (debate) 
President
The next item is the Commission statement on the European electricity network breakdown.
Andris Piebalgs
Member of the Commission. Mr President, the serious incident on the continental European electricity network on Saturday, 4 November led to blackouts over most of the system. We know from E.ON that the fault originated in northern Germany, where switching off an extra high-voltage line in Lower Saxony later led to the switching off of lines across Europe.
E.ON had carried out a planned deactivation of an overhead line and this operation had also been done with a previous line. The incident led to the splitting of the Union for the Coordination of Transmission of Electricity Network into three zones: west, east and south-east. The western zone was short of power and the eastern zone had too much power. To cope with the lack of power in the western zone, automatic devices had to switch customers off in the countries affected.
The worst affected countries were France, where five million customers were reported to have been cut off. In Germany, millions of customers were affected, as in Belgium, the Netherlands, Italy and Spain, where some hundreds of thousands of customers were without electricity. Affected countries also included Austria, Slovenia, Portugal and Switzerland.
The incident was resolved after an hour and the power supply was re-established. The incident could have had much greater consequences but the cooperation between transmission system operators and the size of the network made it possible to supply customers very quickly.
The precise cause of the failure is not yet known. I have asked the European regulators to provide a report on what actually caused this blackout. That involves analysing a huge amount of information before the blackout and after the blackout, so at this stage I cannot report to you on what actually triggered it. The UCTE investigation committee will also provide a report, as will the European transmission system operators, who are investigating the incident.
As soon as we have a full report and a full-scale investigation has been held into this incident, I will report to Parliament in an appropriate form on what actually triggered it; but as far as I can see three lessons should be learned from it. In 2003 a huge-scale blackout had already occurred in Italy and it is clear that the measures taken afterwards were not sufficient, in particular in three areas.
One proposal, therefore, is that we should set up a formal European grouping of transmission system operators which will have the task of putting forward common positions on issues identified by the Commission and in particular network security standards. We should also institute a mechanism to ensure that these standards are formally binding on network operators. It is also clear that much more investment is needed in transmission system networks to provide for an adequate response when such incidents happen, but most importantly to ensure that lines are not overcharged.
I am very pleased that you put this question on the agenda of this House, as it is a very important issue. This was not a natural disaster but a system failure, and we should analyse it and draw the necessary lessons from it. As soon as the report is ready, the Commission will not hesitate to draw the necessary conclusions and take the necessary action.
Herbert Reul
on behalf of the PPE-DE Group. - (DE) Mr President, Commissioner, first of all, many thanks for that level-headed report: the problem lasted an hour, and then it was sorted out. That, too, is an argument worth mentioning.
Secondly, like you, I take the view that a full report needs to be produced first in order that we do not arrive at premature answers about all the things that might have gone wrong.
Thirdly, we politicians must face up to the question as to whether the approach we take might be somewhat contradictory: on the one hand, we call for more investment in electricity grids, while, on the other, we threaten the grid operators with the unbundling of their property. Nobody can be expected to invest in networks when they are, at the same time, facing the threat of those same networks being taken off them; that can hardly be regarded as logical.
Fourthly, at the same time as we call for more and more renewable energy, we know that wind power contributes to the reliability of the grids being a very real problem. I have nothing against wind power, but nobody should be surprised when problems of this sort occur.
Fifthly, we demand - and rightly too - more connection points, because we want electricity to be transmitted from one country to another. Right though it is that we should want that, we are, perhaps, paying too little attention to the need to ensure that, at the same time or as a prior requirement, the grids before and after the connection points are adequately prepared.
One consequence I would like to see resulting from this occurrence is our handling energy policy issues in a more realistic and down-to-earth way, without making contradictory demands that can never be met. Perhaps that is a contribution that we will be able to make; whether or not we do so, I look forward to a precise evaluation once the facts are before us, and then we will be able to consider what the political consequences must be - if any. Much of what was said in the days following the power failure was precipitate and resulted not so much from in-depth analysis of the event but rather more from a momentary snapshot of what happened. I am much obliged to you, Commissioner Piebalgs, for what you are doing.
Reino Paasilinna
on behalf of the PSE Group. - (FI) Mr President, Commissioner, ladies and gentlemen, the blackout in Europe affected 10 million people from Germany to Spain. The power cut was a salutary reminder of how closely we are connected to each other via the electricity network and how vulnerable we are at the same time. We still do not know why it happened.
In practice Europe has a common electricity network, but not a common energy policy that would secure supply. No viable internal market for electricity has been established. It is paradoxical that the more our networks are connected, the more vulnerable we are to power cuts. Although connecting up the networks is an attempt to improve the security of supply of electricity everywhere in the Union, an adverse effect is that any problems that arise will affect us all. That is why we need above all to ensure that our common networks function properly, that there are emergency systems that operate nationally, and that the system is monitored by one authority. We need security standards, as the Commissioner said.
The likelihood of other energy crises was heightened when the energy production plants were privatised. The state used to own these companies and invested in the long term. Now we have reached the quarterly investment stage where cash has to be recouped fast, and that is why there is no long-term perspective.
The Commission has taken prompt action, and we are grateful for that. The national transmission system operators must in future cooperate more comprehensively and more transparently. In addition, the strategic review on energy out in January needs to examine the possibility of setting up a common regulatory authority. Moreover, companies need to take responsibility and invest more than they do now in transmission and emergency capacity. If that does not happen, governments will have to intervene and do what they had been doing up until the current phase.
Anne Laperrouze
on behalf of the ALDE Group. - (FR) Thank you for your communication, Commissioner. It is imperative that an extensive and rigorous investigation be carried out into the causes of the power cut that affected a number of EU countries. Should this breakdown be attributed to a lack of information? To a failure to comply with procedures? To a network fault? To a shortage of investment? To a fault in the maintenance of the network or to a commercial cause? Some Europeans view this breakdown as a disastrous consequence of the liberalisation of energy; others view it as the product of inadequate interconnections and of an inadequate trans-European energy network.
As you pointed out, one might also take the view that the management of this breakdown demonstrated the Member States' solidarity towards Germany, deprived as it was of electricity, and that the power cut procedures were implemented in order to prevent far more serious consequences resulting from a European black out.
If the breakdown was a commercial one, the Member States' regulators must together define and review the applicable rules in order more effectively to control the electricity market. If the breakdown was due to technical problems, or to a procedural fault, then the power distribution network managers need to be coordinated more effectively, as they are the operational links in the chain of free flowing and secure energy exchanges. The creation of a European Centre for Energy Networks would enable us to implement a European code of networks aimed at harmonising the standards and procedures of the Member States' networks.
To conclude, I am delighted that the Commission has launched this investigation and I hope - allow me to emphasise this point - that it communicates the results with all due transparency so that we might make progress in preventing any incidents of this kind.
Claude Turmes
on behalf of the Verts/ALE Group. - (DE) Mr President, since Mr Reul, two or three days after the electricity blackout, went on German radio to attack wind energy in much the same way that Mr Glos and E.ON had done, I am glad to hear him, ten days on from the event, declaring that he has nothing against it. It has since become clear that German wind energy did absolutely nothing to help bring this calamity to pass, since the wind on that day was quite normal. 'Day ahead' was delivered, and it did indeed turn out that the wind farms in Germany had made a vital contribution to getting the grid up and running again, in other words, in those situations in which it is possible to define a good interface between the grid operators, the regulators and the providers of wind energy, wind energy did in fact, have positive effects on the grid.
In Spain, by contrast, many wind farms were taken out of the grid during a moment of low frequency, which makes no sense whatever, as wind farms are less vulnerable to low frequency than other generation facilities, and they could have helped to stabilise the Spanish network.
What can this breakdown teach us? The first thing it can teach us is that we have to prepare the networks for long-term investments in energy; electricity generation will migrate to the coasts, and I am talking here not just about wind energy, but also about condensing power plants, which will find it impossible to cool themselves down further inland by reason of the warmer climate and warmer rivers. We will also have to invest much more in decentralised energy provision, in the shape of biomass, biogas, combined heat and power, as well as gas power stations, which can be sited close to the centres of consumption in industry or in towns, which will, to some degree, compensate for this migration and enable us, by means of these decentralised investments, to make more room on the networks for business.
Secondly, what is needed is an EU regulator - not one who will abolish the national regulatory authorities, but an EU regulator with quite specific functions in the sphere of trans-European electricity trading, improving not only transparency but also the interfaces between the national networks. We need this authority right now, but with a clearly defined and narrower spectrum.
Thirdly, the networks are in need of long-term investment, and that cannot be maintained on the basis of high yields in the short term. It is precisely because E.ON and RWE want returns of 30% that we need ownership unbundling, for such high yields are not necessary in a monopoly sector, where no more than a return of between 6% and 8% on the investment to be made is needed. A clear separation of the grid's interests and the production and trading interests will improve security of supply and also the European network's capacity to act.
Esko Seppänen
on behalf of the GUE/NGL Group. - (FI) Mr President, Commissioner, energy is produced heterogeneously among the Member States. In some countries, cheap hydro-electric energy is of key importance; in others, cheap nuclear energy. In other countries, electricity is produced by burning ever more expensive fossil fuels or by means of expensive wind power. The picture of the market is further muddled by the EU's emissions rights trading scheme, and we do not know what the future holds for that in 2008, let alone 2013.
Connecting the EU's electricity networks does not solve all the problems. Harmonisation of the market will produce winners and losers. There are many countries that will not agree to invest in interconnecting networks or pay a high price for electricity just so that it might be cheaper in another country. I am glad that the Commission's standard answer this time has not been that the harmonisation of markets solves everything, but that instead it is actually trying to find out what this was all about.
Alejo Vidal-Quadras
(ES) Mr President, the power cut that was experienced on 4 November once again demonstrated the high level of interdependence between the electrical networks of the Member States. The fact that ten million citizens and about a dozen countries were affected gives us an idea of the gravity and scope of this incident.
There is undoubtedly a positive side to this, which is the swiftness and efficiency of the reaction by the operators, who, by taking the appropriate measures, managed to solve the problem in just under an hour. However, although we should be pleased with this, what we should not do is tempt fate.
Commissioner, you said that a detailed investigation is going to be conducted into the causes of this incident and there is no doubt that this needs to be done, because from every crisis like this we learn very valuable lessons. I am sure that when you have all the necessary information, you will pass it on to this House so that we can also analyse it.
Commissioner, I fully agree with you that there is a need, as you recently mentioned, to create a formal group, at European level, of transmission system operators that can make technical proposals on safety standards for the networks and other issues that are relevant to what we are dealing with.
A few years ago I proposed a similar initiative in relation to the report on security of supply and I must say that, on the part of the regulators and many colleagues in this House, the initiative was not very successful. I hope that after this latest crisis, this proposal will be re-examined with more realism.
Finally, Mr President, Commissioner, I would like to take this opportunity to make a comment to the Council: it is now time that, in a Europe in which there is free movement of services, goods, capital and people, in which twelve of the Member States have the same monetary policy, in which we all share an international trade policy, we stop pretending that the decisions that we take about energy only affect us. This latest incident made this very clear.
It is not about taking sovereignty away from any Member State, but about acting together on all those things in which joint action benefits everyone.
Vincenzo Lavarra
(IT) Mr President, Commissioner, ladies and gentlemen, the blackout of electricity networks on 4 November is a sign that should highlight the urgency with which we must provide common responses to the energy problem. The episode has shown clearly how closely networks are interconnected, and the lack of appropriate management to support this.
Commissioner, the guidelines presented by the Commission on 9 November to rationalise the cross-border transport of electricity in Europe, which are aimed at improving the management system, are welcome. However, it is important to enforce greater cooperation among regulators: we must speed up the implementation of a single European regulatory authority, a European centre for energy networks, as proposed by the Commission's Green Paper. It is also necessary, in my opinion, to have network administrators that are independent of commercial operators, as well as greater computerisation, enabling transmission networks and distribution networks to communicate.
The internal market is a key aspect of common energy policy. Today, more than ever, this policy is essential and must be regarded as a priority. We must continue down this road with greater courage. Together with the Member States, we must speed up this process, overcoming national protectionist self-interest that slows down liberalisation and competition on the market, so that episodes like that of 4 November will no longer happen, and, above all, so that Europe, as a single actor, can negotiate the delicate international geopolitical balances, securing for itself a protected, sustainable and unified energy supply.
Paul Rübig
(DE) Mr President, Commissioner, ladies and gentlemen, what we must first do is ensure that the grid is well divided up between large and smaller suppliers, between strong central units and regional ones that will enable us to build up a strong structure. For that, of course, trans-European networks are needed, as is a regulator or coordinator to handle these matters, but what is needed above all is the fiscal incentives that will get the profits that will be made used for investment allowances or shorter-term rates of depreciation.
The most important thing, as I see it, is to draw up emergency plans that will give us a chance of shutting down the network quickly and efficiently in the event of a crisis and then restabilising it and restoring the power supply as quickly as possible. We also have to introduce a qualitative dimension into the security of energy supply, meaning that those who are willing to have themselves removed from the network at short notice should also be able to benefit from price reductions, or, conversely, that those who want to remain on the grid as long as possible and be put back on it with the minimum possible delay, should also pay higher charges.
Where energy is concerned, we must get away from debating it only in terms of quantity; there is a need, in energy supply, for qualitative factors that will make it possible for the price schedules to demand that a user who wants absolute security of supply would also pay more. If, though, a user is flexible by reason - for example - of being able to draw on the energy for his warm water requirements either by night or by day, then he should be charged at a correspondingly more favourable rate.
Everyone should be able to choose their own energy supplier, and everyone should be able to get their electricity from the generator of their choice; if they could do that, it would give us a real chance of reshaping the European market.
Giles Chichester
Mr President, this was an example of the law of unintended consequences, not a disaster.
We must await the outcome of the inquiry you have launched and avoid kneejerk reactions. We have learned once again that people's behaviour is not always predictable. I submit that it is not possible to legislate against every eventuality. This was primarily a technical problem and not necessarily one about policy.
I would remind the Commissioner and the House that we already have legislation in place in the shape of the security of electricity supply and infrastructure directive, for which I was Parliament's rapporteur. We should wait for that piece of legislation to bed down and be seen to be properly transposed and implemented in Member States before we move on to enact more legislation. Let us learn from this, but let us also remember that the network operators - the transmission system operators - have a remarkable record of maintaining supply. As my colleague, Mr Rübig, has said, a 100% supply is a difficult target to achieve. I believe they do a pretty good job.
I invite the Commissioner to come and join my colleagues on the Committee on Industry, Research and Energy. We are going back to our committee meeting after this discussion. One of the matters we will be discussing is Mrs Morgan's report on the Green Paper. It is good to see the Commissioner here and if he does not have to rush away he will be very welcome to join us.
Andris Piebalgs
Member of the Commission. Mr President, firstly, I am very grateful for the invitation and I will definitely come, but I shall only listen to the debate and not intervene in the proceedings of the committee.
Secondly, it is important to have all the results of the investigation before we reach a conclusion. That is why I want to launch all these inquiries, because we really need a factual basis. It was a planned action and not a natural disaster. We really need to know why it happened.
Thirdly, today's debate has been very valuable. In a way it has been a prelude to the debate to be held in the committee, because it has examined how best to ensure that the necessary investments are made in power and in the energy sector in general, and which are the best ways to guarantee that investments are made and the system functions properly.
I should like to praise the transmission system operators, who really cooperated on a voluntary basis. Their quick response prevented an even worse blackout.
I should like to inform Parliament that during the summer the European transmission system operators always pay close attention to demand and supply on the electricity market. As you know, summers are becoming hotter and the consumption of electricity at that time increases tremendously, so every year there is more and more demand for electricity and the networks are overloaded.
It is very important also to mention that network security standards must always be observed. Therefore, we definitely need a binding standard to which all network operators have to adhere. We have already seen the example of the Swiss blackout, which caused the blackout in Italy. It was clear the operator had not complied with the network security requirements and that resulted in a large-scale blackout. We should ensure that such a situation never occurs again and, at the same time, establish a system that is very reliable, where the size of the European network and the size of the UCTE system help to prevent blackouts, rather than causing blackouts or making them more widespread.
I thank you for the debate. As I promised, as soon as the results of the inquiry are available, I will be ready to come to Parliament.
President
The debate is closed.
