Annexes to COM(2019)177 - More efficient and democratic decision making in EU energy and climate policy

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dossier COM(2019)177 - More efficient and democratic decision making in EU energy and climate policy.
document COM(2019)177 EN
date April  9, 2019
Agreement. Since energy production and use are responsible for more than three quarters of CO2 emissions, environmental taxes on CO2 emissions can only achieve their objective if energy production and use are covered by such taxation measures. Accordingly, CO2 taxation measures on energy should benefit from the passerelle clause established in the environment title of the TFEU.

The triggering of this passerelle clause would not directly affect the current competences of Member States in the field of taxation but would only amend the way these competences are exercised. Such an approach would rather contribute to the efforts to enhance the institutional framework for taxation in general. Furthermore, using the passerelle clause would result in applying the ordinary legislative procedure, whereby the European Parliament and the Council as co-legislators represent on equal footing a broad range of interests. Indeed, the qualified majority voting is an expression of the fundamental idea of unified actions, based on compromise. This rationale is valid for the majority of policy decisions in the area of energy and climate, therefore the benefits of the qualified majority can be further explored in the area of environmental taxation as well.

Such a move would form part of the more general approach on the use of passerelle clauses, as outlined in the roadmap of the sectoral Communication “Towards a more efficient and democratic decision making in EU tax policy” 22 . The second step of this roadmap provides that moving to the ordinary legislative procedure, based on qualified majority voting in the Council and co-decision rights of the European Parliament, should cover measures primarily of a fiscal nature designed to support other policy goals including the fight against climate change. For this second step, the Commission has invited EU leaders to decide swiftly.

The Commission also underlined in this Communication that more efficient tax-related decisions in this area would make it possible to implement a more environmentally friendly energy policy, for example, to support the ambitious EU goals on climate change. The specific passerelle clause of Article 192(2) TFEU in the environment field, which in particular covers provisions of a primarily fiscal nature, offers a route to move from the special to the ordinary legislative procedure for a more environmentally friendly energy policy. As an alternative, the use of the general passerelle clause in Article 48(7) TEU would provide for qualified majority voting for tax measures primarily designed for energy goals.

3. Decision making under the Euratom Treaty

Nuclear power is a reality in today’s European energy mix. Half of the Member States use nuclear energy for their power generation, representing 27% of the EU’s electricity generation.

When the Euratom Treaty was signed in 1957, nuclear energy was seen as an energy resource for Europe’s economic development. This Treaty provides extensive supranational powers at Community level. In practice however, the application of those powers has been selective and has evolved over time. At its origins, Euratom was primarily intended to provide a boost to nuclear energy; today, its activities are related to safety, security of supply, safeguards, waste management, radiation protection, research and medical applications. Euratom has played an important role in strengthening nuclear safety in new Member States and in the EU's neighbourhood. The potential cross-border impact of nuclear safety issues requires – even more today and in the coming years – a legal framework that goes beyond the borders of the Member States. This framework has been reinforced with the secondary legislation adopted since the Fukushima accident. Similarly, ageing power plants throughout the EU are raising issues of lifetime extension, timely phasing out, decommissioning, waste management and related investments. The importance of these issues will increase in the years to come.

There is a clear understanding that the use of nuclear energy is a national choice to be made by each Member State and this will continue to be the case. The Euratom Treaty provides the most advanced legal framework in the world in the areas of nuclear safety, waste management or radiation protection. There is, however, a recognised concern that the Euratom Treaty needs to evolve in line with a more united, stronger and democratic EU. This concern is reflected in the Declaration that five Member States made to the Treaty of Lisbon 23  noting that the core provisions of the Treaty establishing the European Atomic Energy Community have not been substantially amended since its entry into force and need to be brought up to date.

A central aspect is the democratic accountability of Euratom and in particular the involvement of the European Parliament and national Parliaments. The Treaty of Lisbon extended the ordinary legislative procedure to nearly all policy areas where the European Parliament previously only had a consultative role. While the ordinary legislative procedure also applies in general to the Euratom Treaty 24 , in practice the provisions of the Treaty regarding the adoption of legal acts do not foresee it. The European Parliament is only consulted on these provisions. Similarly, the Treaty of Lisbon introduced an enhanced role for the Parliament in the process for concluding international agreements, with Parliament’s consent often necessary. 25 This is not the case under the Euratom Treaty where the European Parliament is not consulted on the conclusion of international agreements. Therefore, it may be useful to explore how to enhance the role of the European Parliament to improve the democratic legitimacy of decision-making under Euratom.

An additional area where the Euratom Treaty does not reflect improvements in terms of transparency and democratisation achieved in the successive reforms of the EU Treaties is with regard to the role of national Parliaments. While Protocol No. 1 on the role of the national Parliaments in the European Union is part of the Euratom Treaty framework, there is no equivalent in the Euratom Treaty to Article 12 of the Treaty on EU that sets out the role of national Parliaments. Against this background, it may be useful to explore whether the role of national Parliaments under the Euratom framework can be reinforced further.

The Commission should also take initiatives to increase the involvement of civil society in nuclear policy making and raise EU-wide interest in relevant fora. On some nuclear matters, the availability of information can be understandably limited, especially in the field of nuclear security. While this is a legitimate concern, issues such as nuclear safety, the management of radioactive waste and emergency planning deserve to continue to be debated as openly as possible in line with existing rules.

These issues are central to citizens’ concerns. The first step is rigorous implementation of recently agreed legislation. In the area of responsible and safe management of spent fuel and radioactive waste, it is of utmost importance that Member States continue to develop comprehensive plans for the management of nuclear waste and implement these plans. When cross-border impact is at stake, cross-border consultations between Member States should be promoted as well as stronger involvement of European Nuclear Safety Regulators Group (ENSREG). The EU's and Member States' collective ability to respond to nuclear accidents should be reinforced, in particular to clarify financial responsibility and ensure adequate financing in this respect.

The Euratom Treaty does not provide for a simplified procedure for its revision in the sense of Article 48(7) TEU. The passerelle clauses under the EU Treaties are also not applicable to the Euratom Treaty. Therefore, a revision of the Treaty, aiming at extending the use of the ordinary legislative procedure to the Euratom Framework, would require the use of the ordinary Treaty revision procedure under Article 48 TEU.

Consequently, a change of the Euratom Treaty to extend the use of the ordinary legislative procedure would need to be part of a broader process of Treaty reform using the ordinary Treaty revision procedure under Article 48 TEU and should be seen in the longer-term, post-2025 perspective. In the months to come, the European Commission will establish a High Level Group of Experts whose task will be to assess and report to the Commission on the state of play of the Euratom Treaty with a view to considering how, on the basis of the current Treaty, its democratic accountability could be improved.

4. Conclusion

As the Commission has recently stressed in its Communication “A Clean Planet for All”, the energy transition requires a comprehensive economic and societal transformation, engaging all sectors of the economy and society to achieve the transition to climate neutrality and sustainability by 2050.

Achieving this objective requires decisive action across policy areas and it is essential that the EU should be equipped with the tools to take the necessary decisions in a manner that is both efficient and democratic.

In this sense, significant progress has been achieved over the last years with the completion of the Energy Union policy framework. On the regulatory side, this progress is closely linked with the use of the ordinary legislative procedure. Full involvement of the European Parliament and the Council has played a positive role, both in terms of the democratic nature of the process, as well as for achieving an ambitious outcome on many important files.

This Communication has identified two areas where decision-making could be further enhanced to the benefit of achieving Energy Union objectives.

The Commission calls on EU leaders:

–In line with the earlier call, 26 to decide quickly on the use of the general passerelle clause (Article 48(7) TEU) in order to move to the ordinary legislative procedure and qualified majority voting. The European Council is invited to notify national Parliaments of its initiative and seek the consent of the European Parliament. Besides, the specific passerelle clause of Article 192(2) TFEU offers an obvious route to move to the ordinary legislative procedure for taxation matters in the environmental field;

–Together with the European Parliament, the Council and other stakeholders, to engage actively in the reflections of the High Level Group of Experts which the Commission would invite to assess how best to increase the democratic accountability and transparency in the framework of the Euratom Treaty.

(1)

COM(2018) 773 final of 28. November 2018 – A Clean Planet for All.

(2)

Regulation (EU) 2017/1938 concerning measures to safeguard the security of gas supply; Decision (EU) 2017/684 on establishing an information exchange mechanism with regard to intergovernmental agreements and non-binding instruments between Member States and third countries in the field of energy; COM(2016) 49 final of 16. February 2016 – An EU strategy for liquefied natural gas and gas storage; COM(2016) 51 final of 16. February 2016 – An EU Strategy on Heating and Cooling.

(3)

COM(2016) 860 final of 30 November 2016 – Clean Energy for All Europeans.

(4)

Directive (EU) 2018/410 amending Directive 2003/87/EC to enhance cost-effective emission reductions and low-carbon investments, and Decision (EU) 2015/1814; Regulation (EU) 2018/842 on binding annual greenhouse gas emission reductions by Member States from 2021 to 2030 contributing to climate action to meet commitments under the Paris Agreement; Regulation (EU) 2018/841 on the inclusion of greenhouse gas emissions and removals from land use, land use change and forestry in the 2030 climate and energy framework.

(5)

COM (2017)283 final of 31. May 2017 – An agenda for a socially fair transition towards clean, competitive

and connected mobility for all; COM (2017)675 final of 8. November 2017 – Delivering on low-emission

mobility; COM (2018)293 final of 17. May 2018 – Sustainable Mobility for Europe: safe, connected, and

clean.

(6)

Regulation (EU) 2018/1999 on the Governance of the Energy Union and Climate Action.

(7)

COM(2019) 175 of 3 April 2019 – Fourth report on the State of the Energy Union.

(8)

Single European Act, OJ L 169, 29.6.1987, p. 1–28.

(9)

This is the third Communication on the issue of qualified majority voting. The previous Communications are: COM(2019) 8 final of 15. January 2019 – Towards a more efficient and democratic decision making in EU tax policy; and COM(2018)647 final of 12. September 2018 – A stronger global actor: a more efficient decision-making for EU Common Foreign and Security Policy.

(10)

Article 194 (1) of the Treaty on the Functioning of the European Union.

(11)

Article 194 (2) of the Treaty on the Functioning of the European Union.

(12)

Article 194 (3) of the Treaty on the Functioning of the European Union.

(13)

Article 192 (2) of the Treaty on the Functioning of the European Union.

(14)

Total taxes represent 40% of the final electricity price for households according to COM(2019) 1 of 9 January 2019 – the Energy Prices and Cost report.

(15)

Council Directive 2003/96/EC of 27 October 2003 restructuring the Community framework for the taxation of

energy products and electricity.

(16)

Source: Eurostat - Environmental taxes in the EU: countries compared

https://ec.europa.eu/eurostat/web/products-eurostat-news/-/DDN-20190212-1 .

(17)

Some of these sectors are, however, subject to the ETS and hence a carbon price signal, notably energy-intensive industry and intra-EU flights.

(18)

COM(2011)169 final of 13. April 2011 - Proposal for a Council Directive amending Directive 2003/96/EC

restructuring the Community framework for the taxation of energy products and electricity.

(19)

  https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52019DC0001&from=EN .

(20)

  https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52019DC0001&from=EN .

(21)

Article 192 (2) of the Treaty on the Functioning of the European Union.

(22)

COM(2019) 8 final of 15.1.2019.

(23)

Declaration 54 to the Treaty on the Functioning of the European Union by the Federal Republic of Germany, Ireland, the Republic of Hungary, the Republic of Austria and the Kingdom of Sweden.

(24)

Article 106a of the Euratom Treaty lists the provisions of the Treaty on European Union and the Treaty on the Functioning of the European Union that also apply to the Euratom Treaty. These include Articles 288 to 299 of the Treaty on the Functioning of the European Union, covering the legal acts of the Union and the procedures for the adoption of acts and other provisions.

(25)

Articles 207 and 218 of the Treaty on the Functioning of the European Union.

(26)

COM(2019) 8 final of 15. January 2019 – Towards a more efficient and democratic decision making in EU tax

policy.