New Challenges in Times of Crisis

Abstract

In the decades since the European Union’s energy policy was established, we have witnessed a process of development which has resulted in the field being regulated by the Treaty in its own legal framework and has continued to evolve to the present day. Governance at the EU level has become more important in the field of energy policy, but the crises have led to an increasing role for Member States. The EU’s single rule aims to ensure a level playing field for market players in the competitive sector, while preventing unfair competitive advantages for companies created by or benefiting from public or state resources. The EU state aid rules have undergone significant changes in the last few years. State subsidies are part of competition policy, which aims to ensure an efficient economy and consumer welfare. Among the market failures in the energy sector, the most significant disadvantage is the presence of externalities and natural monopolies. These need to be addressed through government assistance and its direct and indirect regulatory instruments. Competition law also covers economic services of general interest, which are closely linked to the issue of state subsidies. Member States have discretion to define services of general economic interest, subject only to the limits set by EU law, and to avoid manifest error of assessment. The energy packages include the term “universal service” for electricity, but not for gas, leaving it to the discretion of the Member State to decide on the latter. The crises have brought with them a breakdown of neoliberal ideas and, as a consequence, a strengthening of the tendencies in favour of state regulation. In most Member States, we are witnessing a closure, voices critical of the EU in many respects (e.g. Hungary and Poland in the context of the Art. 7 procedure) and Brexit has had a negative impact on communitarisation policies.