The big theme of this latest six month rotating EU presidency, in the hands of Hungary, is Europe's future energy supply question.  If Europe is going to decarbonise, become more reliant on renewables, a new approach to the electric grid system is going to be essential, the commission says. 

At a summit on the 4th February, EU governments will be discussing the commission's proposals.

Engineers will be paying close attention. 

According to a commission report, 200 billion euros' worth of electricity infrastructure upgrade  is needed for European economies that will be increasingly dependent on electricity at at the consumption end, with electricity increasingly used for transport and the growing number of gadgets in the home.

The ageing grid needs replacing anyway, but the commission particularly wants grid upgrades between countries, which have been relatively neglected as domestic energy providers tend to be highly vertically integrated, nationally focused outfits. 

It wants this is because one problem with electricity is that it is difficult to store, and another is that one of the weaknesses of some forms of renewable energy sources is their variability, or intermittency.

In the commission's ideal world, this variability can be reduced by drawing on electricity from various different renewable sources, across Europe with different weather patterns,  so  peaking at different times. Some of the wind- or solar- derived electricity could be stored by pumping water upwards and storing that potential energy in dams in the mountains of Norway or the Alps for later use as hydropower electricity, drawn upon as needed.  It would be one way of capturing renewables' flighty potential.

The commission also wants to see more buying and selling of regularly generated electricity across borders than currently.  Most European electricity will continue to come from coal fired plants, nuclear power and natural gas. Much of Europe's gas will be coming in through new pipelines that connect to southern Europe and these have to reach their markets

A better developed euro grid will increase efficiencies and lower average electricity prices, as overcapacity one country could more easily match demand in another.

To these ends, the commission has proposed, to start off, a number of strategic energy corridors where new infrastructure will be prioritised to get the ball rolling, where EU - ie taxpayer - funding could help as a subsidy and planning conditions could be eased. One corridor would link present and future wind farms between the North Sea and the continent.  A southern gas corridor is another suggestion.  In usual circumstances it can take 10 years for a power lines or gas pipelines to be built.  The commission wants legislation to cut that to a year or two.

Thus the commission recommendations.

However, another report, published by the independent Brussels think tank Bruegel, emphasises that there is a lot to do and a long way to go. George Zachmann, its energy expert, believes the commission is going the wrong way about reforms by strategically setting corridors based on  some intuitive perception of necessity rather than launching fundamental redesign of the electricity market  to find out where the likely needed international electricity flows are going to be.
 
One analysis compared the commission's  strategic corridor proposals as something akin to building roads without knowing what traffic will travel on it.  The commission wants to put the cart before the horse.
What's needed first is electricity pricing reform, only then can engineers can get to work and start building the power lines.

Nodal pricing as practised in Texas, Chile, New Zealand and some other places calculates the cost of putting in/withdrawing electricity from thousands of so called nodal points across the network.  This creates the politically unpalatable situation - for Europe anyway - of different regional electricity prices. But it is invaluable as a price signal to investors to upgrade cable capacity as well as new power plants, to better profitably serve the high price area.

It will also better stimulate cross border electricity flows on the same principle. At the moment, electricity users are more apt to buy electricity more expensively from a remote power plant within the same country rather than a cheap one just across the border. Zachmann found that at the moment there is less international electricity transfer capacity made available between Germany and its neighbours than 10 years ago, partly, ironically, because the variable output of renewables created the desire for spare capacity in the system.

This nodal, "price signal" pricing system would first have to be rolled out nationally. At the moment, it's not even on the table, partly because politicians fear a backlash from a flexible pricing system, although there are ways around that.

Criticising from another direction, the Greens in the European parliament says the commission's energy strategy fails to curb nuclear power and that it didn't really try to cure the "EU's addiction to fossil fuels".  
 
For them, the EU's longstanding goals of curbing energy use and raising renewables to 20% of the total mix by 2020  are far too modest; and these plans do not deviate from that framework. 
 
So the feeling in Brussels is that, despite the incipient summitry and optimistic claims, the right changes that need to be made are not in the offing.  And the  member states are to be blamed too.  How to generate the political will when there are difficult, complex choices to be made - the literature on electricity pricing is vast - and a huge number of regulators and private enterprises to be coordinated? 

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Pelle Neroth -- EU correspondent

Edited: 04 February 2011 at 04:04 PM by Pelle Neroth

It is disappointing to see that the idea of a European-wide grid is being talked of in terms of dealing with wind and nuclear power variations across Europe. And of course the intricate details of how the private sector is going to deal with costs.

These two sources of power only account for about 5% of our total energy use, so considering only those is woefully short of what should be being discussed, which is how to decarbonise the other 95%.

Only one scheme seems to have the ability to do this, while using technology that is known to work, and that is large-scale solar power in N Africa. This will need an electricity infrastructure in Europe that is at least 8 time the capacity of the present one. Now that is what you might call a vision of the future. This approach is being left to private enterprise instead of being at the core of European energy policy

What is being proposed is so far from being a vision of what is needed as to be akin to grovelling in the dungheap. It is a complete waste of resources and will do nothing to improve our energy security.

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BrianAnalogue