The energy mix and the transition to a low carbon economy by 2050 31 - - PDF document

The energy mix and the transition to a low carbon economy by 2050 31 January 2012 EESC Judith Kirton-Darling

Thank you for inviting the ETUC to bring the concerns, hopes and aspirations of millions

• f European workers into this debate.

The future of European integration depends on public support and a strong progressive

• vision. Notre Europe’s vision of a European energy community – a Europe built on

solidarity and cooperation – a vision that the ETUC shares. Beyond the urgent need to act to mitigate climate change, the challenges facing us as a Continent demand common action in terms of energy security, production, transmission and storage, technological developments, and the social and employment consequences. In December 2010, before the 1st-ever European energy summit in February last year – a European energy solidarity pact was our number one priority. A solidarity pact would go beyond financial transfers between countries, but as Notre Europe propose push for European integration through cooperation not only coordination in the development of

• ur energy production and transmission, generating jobs in its wake.

The EU energy summit failed to deliver concrete action. And the political and economic context has become harder in the last year, while the need for European action and cooperation has become more apparent – especially following Fukushima. The ETUC calls for a coherent EU energy policy as a precondition to the transition to a low carbon economy. Our jobs and communities depend on clear policy ensuring that energy is considered a service of general interest. Current EU policy is currently fundamentally flawed. The logic of ever-stricter austerity, reinforced undemocratically and irresponsibly by

• ur governments yesterday, is totally at loggerheads with the investment needed for the

transformation of our transport and energy infrastructure. Austerity measures will not build a sustainable, fairer Europe. They will not deliver the jobs and skills, tackle energy poverty or the cost to basic industries nor ensure the fair and just transition to a sustainable future vital for us all. One in five young workers in Europe are unemployed – over a million in my own country and over half Spanish young workers. We are facing a lost generation. Paradoxically we are also facing major skills gaps. It’s a damning indictment of poor economic management and proof that the market alone will not deliver. An alternative macroeconomic policy agenda is fundamentally needed as a precondition to building a European energy community. An agenda of public and private investment (through €-bonds, FTT, the EIB, and ETS revenue) based on concrete employment-rich infrastructure and industrial policies in the EU. Strong regulation is essential to ensure certainty for investors, to favourlong-term investment over short-term shareholder returns, and allow the development of coordinated public and private investment strategies. A strong binding EU energy efficiency target is part that frame. A coherent and modern European industrial policy is needed – some elements are

currently being developed by the Commission. The ETUC supports Bill Gates plea last week in the EP for increased public and private R&D funding in Europe – this should channeled as a priority to cooperative technology platforms on low carbon technologies. Backed up by a clear price signal on the cost of carbon – something which the ETS is not

• providing. The ETUC supports the development of energy taxation, subject to certain

criteria (avoiding double taxation, ensuring that revenue is reinvested to support low- carbon technologies and the most vulnerable consumers are protected from passed on costs). In terms of the energy mix and diversifying sources. Europe must aim at ensuring its energy independence and diversify its energy supply, through strategic planning and by means of an ambitious adjustment in favour of renewable energy to the detriment of fossil fuels. We believe this demands a European Energy Agency with stakeholder participation. We are committed to the Spring Alliance’s call for an increased share of at least 35% of renewables in electricity supply EU-wide by 2020, as well as increased investment in combined heat and power and the development of clean coal technologies, such as CCS. Considering the investment cycle in the industry, EU binding targets are needed for 2030 to channel investment particularly as we know where we need to get to by 2050 according to IPCC models. In this context, the EU must commit itself to large-scale projects (such as the solidarity dimension of the Notre Europe proposals) to address challenges faced in the new member states. Public acceptance depends on job creation and investment. Moreover, the ETUC calls for measures to prevent negative social impacts of rising energy prices, the priority being household energy efficiency and affordable low-energy alternatives for vulnerable consumers. The ETUC urges the Commission to assess the social consequences of decarbonisation and the impact on vulnerable consumers, due to the possible increase of 15 to 20% in electricity prices by 2020. Universal access to essential energy services needs to be secured to all people living in Europe notably through the provision of social tariffs and through public services. Therefore, enforcing the implementation of the requirement for universal and affordable access to services in existing legislation is required, such as through additional provisions on access to a minimum supply of energy, to secure the energy provision of the poor and protect them from power disconnection through establishing a right for energy supply. In terms of the jobs involved in the energy sector and its value chain, most studies, including those the ETUC has undertaken itself, predict a net increase in the workforce as a result of the transformation of our energy infrastructure – with big potential gains particularly in the supplying machinery industries and the electricity sector, but with differences between types of fuels. Coal and oil fuelled power plants will see their workforce reduce, while gas and renewables will increase. The pace of deployment of clean coal technologies like CCS will also influence these evolutions. In the distribution field, evolutions are more difficult to estimate, with the introduction of smart meters destroying jobs (traditional meter reading) and creating new ones (energy serviceson reducing consumption for example). In terms of the skills and training needs stemming from the transition. A recent joint study by EPSU-EMCEF and Eurelectric (Feb 2011) on the employment impact in the electricity sector of the transition to low-carbon energy towards 2030,nevermind

2050,makes challenging reading on an industry set to grow whilst the workforce ages. The anticipation of which skills will be needed in the future is essential if the appropriate actors are to balance the demands from the industry with the supply of labour with the appropriate skills. It is widely accepted that work in the future will require energy sector workers to possess a higher level of skills than currently as a result of the introduction of new technologies. But skills investment should concern not

• nly the improvement of training and educational infrastructures and programmes, but

also ensuring workers have the individual right and access to training. Social dialogue is essential to make such transition more fair and efficient, and ensure that emerging jobs are safe and decent. A strengthening of worker participation is of key importance. I would like to return to my first comments about the economic governance model being pursued currently. It is clear the demands of the energy sector social partners that we need a framework for the anticipation of change and restructuring. Currently there is a public consultation on this underway, but the narrow focus of the Commission remains

• n flexicurity and labour market deregulation.

This must be socially-managed change. A poorly managed social transition to a low- carbon economy will result in higher social and economic costs and threatens a backlash against climate policy. The extremely violent attack currently under way on social protection & security systems and the welfare state - the very foundations of social relations in Europe - are critical in this debate. Under the guise of economic governance, there is a wholehearted attack on industrial relations, with challenges to the Labour Codes and basic social rights in many countries, and a concerted attempt to decentralize collective bargaining to the lowest level. This is a dismantlement of the key mechanisms to guarantee solidarity and social cohesion within and between member states. These systems and rights are crucial to ensure the framework for the anticipation of industrial change. It is counter-productive to be dismantling when we should be reinforcing them to prepare for the changes coming. Just transition and decent jobs must be an integral part of the energy policies of the future of Europe. Therefore, the ETUC is calling for a European Just Transition Roadmap to implement this international commitment agreed in Cancun/COP16. The Roadmap should be drawn up in collaboration with unions and should include: the active promotion of social dialogue at all levels, sectoral roadmaps managing the transition and targeting investment, public-led education and training strategies, instruments on the anticipation of change and restructuring, the promotion of strong and effective social protection systems, and the respect for fundamental trade union rights and human rights. We hope the social dimension of a European energy integration will be far stronger than the current social dimension of economic integration.