Does Energy Efficiency Need Global Governance?

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1 Does Energy Efficiency Need Global Governance? Dr. Dario Chello -Energy Charter Secretariat -Brussels UNECE Energy Week Palais des Nations Geneva, November 2011

2 The two pillars of sustainable energy Sustainable energy is the provision of energy that meets the needs of the present without compromising the ability of future generations to meet their needs. Any serious vision of a sustainable energy economy requires commitments to both renewable energy sources and energy efficiency. Today, in my presentation I will try to define and clarify our understanding of the terminology and concepts involved in the political discourse with a particular emphasis on the meaning of governance. Then I will try to identify the key attributes of global governance, examine their applicability to energy efficiency and make an attempt to give an answer to the question Does Energy Efficiency Need Global Governance? 2

3 From Energy Independency to Global Governance: a Short Story of Energy Security of Supply Energy Security Concept Energy Dialogue From Dialogue to Club Governance Moving on to Global Governance Energy Charter Process 3

4 Energy Security Concept Definition of Energy Security Energy Independency Rate Is Energy Independency Sufficient to Isolate States from External Events? 4

5 Energy Security Concept Should the Russian Federation Pursue Energy Independency? Energy Independency vs. Energy Interdependency 5

6 Energy Dialogue and Club Governance Creation of the International Energy Agency Conference on International Economic Co-operation International Energy Forum Other Fora on Energy Security 6

7 Energy Dialogue -Chronology Year Event Host Co-Host 2012 IEF13 13th International Energy Forum & 5th International Energy Business Forum Kuwait Algeria & Netherlands 2010 IEF12 12th International Energy Forum & 4th International Energy Business Forum Mexico Germany & Kuwait 2008 IEF11 11th International Energy Forum & 3rd International Energy Business Forum Italy India & Mexico 2006 IEF10 10th International Energy Forum & 2nd International Energy Business Forum Qatar China & Italy 2004 IEF9 9th International Energy Forum & 1st International Energy Business Forum Netherlands Iran & Norway 2002 IEF8 8th International Energy Forum Japan Italy & UAE 2000 IEF7 7th International Energy Forum Saudi Arabia Japan & Netherlands 1998 IEF6 6th International Energy Conference South Africa Qatar & UK 1996 IEF5 5th International Energy Conference India Brazil & Norway 1995 IEF4 4th International Energy Conference Venezuela EC & Russia 1994 IEF3 3rd International Energy Conference Spain Algeria & Mexico 1992 IEF2 Ministerial Workshop Norway Egypt & Italy 1991 IEF1 Ministerial Seminar France Venezuela 7

8 Energy Dialogue and Club Governance Oil price change, percent -In percent year on year at beginning of year in $$ of the day (for 2009 first eight months of 2008). Oil price is U.S. average for , Arabian Light posted FOB RasTanurafor , Brent Spot FOB for , and world weighted spot FOB average for

9 From Energy Dialog and Club Governance to Global Governance Common Denominators of Global Governance Management Global Problems Global Objectives Concerted Efforts State and International Actors 9

10 From Energy Dialog and Club Governance to Global Governance Energy Security Responds Fully to the Five Criteria of Global Governance Energy Interdependency Driven by Globalisation Global Need for Sizable Energy Investments that Require Predictable Regulatory Environment 10

11 Energy Charter Process December 17, 1994 April, 1998 Energy Charter Treaty (ECT) and Protocol on Energy Efficiency and Related Environmental Aspects (PEEREA) signed ECT and PEEREA came into full legal force Currently ECT and PEEREA signed by 51 states + European Union ECT and PEEREA ratified by 46 states Signatories: Australia, Belarus, Iceland, Norway and Russian Federation Observers: 24 states; 10 organisations 11

12 Energy Charter Process : diversity in member countries GDP/capita: Population: Area: to 140,000 USD (2010) at ppp 36,000 to 142,000,000 people 160 to 17,000,000 sq. kilometers Energy Intensity: to toe/thousand USD at ppp(purchase power parity) to 2.54 toe/thousand USD CO 2 per capita: 845 to 24,833 kg CO 2 /person 12

13 Protocol for Energy Efficiency and Related Environmental Aspects - PEEREA Contracting parties commit to: Formulate and implement EE strategies and policies Create appropriate legal, regulatory and institutional frameworks Develop, implement, and update EE programmes Encourage new approaches of financing EE Co-operate internationally and assist each other 13

14 PEEREA activities Review Progress in Member Countries o In-depth reviews (22 since 1999) o Regular reviews (63 since 1999) o Follow-up reviews (8 since 2004) o Regular updates from Members Analytic Studies o 20 reports since 1999 o Progress reports to the Environment for Europe process (for Kiev 2003 and Belgrade 2007) Events, information sharing, cooperation Events, information sharing, cooperation o Namely: IEA, UNECE, UNFCCC, EBRD 14

15 In-depthReview Process 1. Commitments by Parties as review hosts and review experts 2. Involvement of a wide variety of institutions, businesses and non-governmental actors in the country 3. Product: review report and recommendations 4. Discussion and approval in the PEEREA Working Group 5. Endorsement by the Energy Charter Conference

16 EE & GG 1. Energy efficiency is a potent multipurpose tool for resolving global energy problems. 2. States have recognised the need for global interactions 3. States have started taking concerted actions to scale up implementation of energy efficiency globally 4. However, no system exists to manage and support the process of global and local formulation and diffusion of energy efficiency polices and measures 16

17 Conclusions -1 Security of supply is a Global Problem that could be tackled with Global Governance Mechanisms Testing the above observation against the five elements defined as common denominators of global governance, one may conclude that the establishment of a global governance on energy efficiency could provide the mechanism needed to help address the urgent global energy issues as it would create a coherent system to manage and support the process of implementation of energy efficiency, and subsequently alleviate the global problems by taking concerted efforts. 17

18 Conclusions -2 However, after more than 15 years of experience in the Energy Charter Process it is evident that the way forward to reach the final objectives is not a straight path We do believe that Global Governance could be an effective solution in response to evolving global challenges as long as the rules to share are carefully devised and with a possibility to update, integrate or modify in a clear, transparent and easy manner. 18

19 Thank You! Energy Charter Secretariat 19