Paper_InterestGroupsEnergyLobbies_04:2015

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CLIMATE AND ENERGY DEBATE AT EU LEVEL: INTEREST GROUPS

INVOLVED.

By Edoardo Costa

20149806

Universiteit Antwerpen

2014-‐2015

Master Politieke Wetenschappen

Seminar Paper

Interest Groups

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INTRODUCTION

There is no question about the need to increase the production of renewable energy

in the European Union context for several crucial reasons. First of all, from an

environmental point of view the advantages connected with a reduction of

greenhouse gas emissions and other harmful substances must be taken into

account. Furthermore, looking at the increasingly unstable geopolitical context a

diversification of the sources of energy supply means the possibility to increase the

energy, and thus political, security; let alone the reduction of the dependence on

imported fossil fuels countries, most of all allocated in unstable areas as the Middle

East or in Russia. Last but not least an increasing production of renewable energy

could be reflected in the creation of new jobs, thus in economic and social benefits.

In that sense, the first important proposal -a renewable energy target of 20% by

2020- was adopted by the European Council in March 2007 and was later an

important part of the legislative package on climate and energy adopted by the

European Council and European Parliament in December 2008 (Gullberg, 2013).

With this package member states decided to adopt the so called “20-20-20” targets

that set three key objectives for 2020:

-A 20% reduction in EU greenhouse gas emissions from 1990 levels;

-Raising the share of EU energy consumption produced from renewable resources to

20%;

-A 20% improvement in the EU's energy efficiency. (European Commission, 2015)

Even if this process is still going on, the 23 October 2014 the EU leaders agreed on

an even more ambitious policy framework for climate and energy.

They agreed of a greenhouse gas reduction target of at least 40% compared to 1990

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and a 27% renewable energy production by 2030.

Even if, as stated by the Commission, “This 2030 policy framework aims to make the

European Union's economy and energy system more competitive, secure and

sustainable” (European Commission, 2015), the stakeholder’s reaction was different.

In effect it seems to let unsatisfied both environmentalists, renewable and

conventional energy producers. While environmentalists and renewable energy

producers complain against the mediocre achievements of the new framework

compared with the last one, the old industry’s position is against the new targets.

Although the increasing of renewable energy production is a living matter, that has

obtained a central role in the current international debate, Europe has experienced an

expansion of the renewable energy industry in the last decades and this process

seems to go on. Inasmuch political influence is often associated with economic

importance, the increasing economic relevance of this sector entail an increasing of

its political power. Despite that, it requires significant financial support to increase its

competitiveness compared to traditional energy sources (Pach-Gurgul, 2014) as the

gap with the conventional energy industry is still far away to be bridged. The aim of

this article is to analyze which actors are involved in the renewable energy

debate at the EU level, which strategies do they use and why. To this end, I’ve

analyzed the European Transparency Register and I’ve created a dataset where I’ve

inserted the interest groups that under my research are more active on this topic. I’ve

investigated what are their point of view on the debate and I’ve used the previous

literature on interest groups to analyze which are their strategies and why do they

use some instead of others.

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OVERVIEW OF THE INTEREST GROUPS INVOLVED

In order to identify which interests are represented into the climate and energy

package debate and furthermore which interest groups represent the renewable

energy industry I’ve analyzed the EU transparency register.

This register is a common effort made by the European Commission and European

Parliament to increase transparency of influence (Nic Copeland , 2013). As described

on the transparency register’s web page: the EU institutions interact with a wide

range of groups and organizations representing specific interests. This is a legitimate

and necessary part of the decision-making process to make sure that EU policies

reflect citizens' real needs.

At the moment around 5700 organizations are registered and they range across a

wide variety of categories, from consultancies and law firms to NGOs and academic

organisations, think tanks and religious entities (Nic Copeland , 2013). I’ve conducted

my analysis with the aim to find which kind of interest groups are involved on the

renewable energy debate. Typing different keywords (annex) I’ve identified 38

interest groups and I’ve found, looking at their goals and main initiatives, that most of

theme are associations (17), companies and group (10) and NGOs (7). Even if it is

an essential tool it is doubtless that the register is not perfect, for example it is

criticized by transparency campaigners and interest group representatives about the

access of non-registered organizations to EU institutions (Nic Copeland , 2013), thus

an analysis based on it could not be fully comprehensive but it already grasps an

important portion of the interest organizations active on the subject.

There are several definition of Interest groups, according with Beyers it is possible to

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define them using three characterizing factors: first of all they are actors that show a

minimum level of organization, secondly they make efforts in order to influence

policy outcome in a specific direction that satisfied their political interests and finally

they pursue their goals through frequent (formal or) informal interactions with

politicians and bureaucrats. (Beyers at all, 2008). From my sample of interest

organizations I’ve decided to investigate what are the positions and strategies of two

different business association, one from the renewable energy sector and the other

one from the conventional energy sector.

ENERGY PRODUCTION AT EU-LEVEL

As reported by EREC (European Renewable Energy Council), un umbrella

organization of the major European renewable energy industry, trade and research

associations, when the renewable energy industry started lobbying in 2004 for a

renewable energy target it had a turnover of €10 billion and employed 200,000

people. Five years later it had increase the number of employees to 550,000 for a

business of 70 billion while nowadays it as an annual economic activity of more than

€130 billion and more than 1 million employees. (EREC, 2015) All these data

express an incredible growth of this sector in the past years and thus an increase of

renewable energy industry’s lobbying capability on EU energy and climate policies.

However, this sector is still small if compare, for example, with the conventional

energy industry that in 2006 had already a turnover of €830 billion (Eurostat, 2015).

Moreover, the other weak points of the renewable energy industry are the typical

small and medium size of its companies and the distribution of them in the European

area. The wind industry for example employs the 75% of its workers in its three

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“pioneers” countries -Germany, Denmark and Spain- and although other EU

Members States are now catching up, the three-quarters of the jobs are allocated in

few countries (Wind at work, EWEA, 2009).

At this purpose I’ve found interesting to analyze what are and what were the lobbying

strategies of the most important wind industry association at the EU level, the

European Wind Energy Association (EWEA), and of one of the most important

conventional energy association, EURELECTRIC. The objective of EWEA is to

facilitate national and international policies and initiatives that strengthen the

development of European and global wind energy markets, infrastructure and

technology in order to achieve a more sustainable and cleaner energy future. (This

association) act as a single European voice to promote, through the joint efforts of its

members, the best interest of the wind energy sector (EWEA, 2015). In the interest

groups literature one of the most important distinction is between public and business

organizations as well as diffuse and specific interests, this kind of association from

my point of view is a busyness association with specific interests that in its lobbying

activity stressed its social role in order to gain more access to policymakers.

EURELECTRIC has the same purpose, but represent other interests that probably

can collide with the former ones and with the new energy and climate frameworks. It

is a sector association representing the common interests of the electricity industry at

pan-European level. In line with its mission, EURELECTRIC seeks to contribute to

the competitiveness of the electricity industry, to provide effective representation for

the industry in public affairs.

As indicated in the Overview of the electricity production and use in Europe (ENER

038) - published in Decembre 2014 the gross electricity generation in 2012 was still

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dominated by fossil fuels for almost one half (48%) while the second place was

occupied by nuclear energy sources (27%), thus the electricity industry is still

dominated buy conventional energies and we can expect EURELECTRIC to have a

different position on the energy an climate package in respect to EWEA and maybe

to adopt different lobbying strategies.

LITERATURE ON INTEREST GROUPS

As defined by Gullberg, interest groups exert lobbying pressure with institutionalized

or non-institutionalized contacts and activities directed at decision makers in an

attempt to influence public policy outcome (Gullberg, 2009). Interest groups can

adopt different strategies but previous literature generally distinguishes between

insider and outsider strategies. The differences between these two strategies are that

while the former concerns formal and informal networking with policymakers and

bureaucrats, the latter regards media strategies such as press release and articles or

the mobilization of constituencies, for example through petitions or demonstrations

(Beyers at all, 2008). Obviously, it is harder to identify what are the real direct

contacts between lobbyists and policymakers because often they are informal and

happens “behind the door” while outsider strategies are more evident. Normally,

best-established busyness interest groups are specialized in inside strategies but

when their policy monopoly comes under pressure they may use outside strategies in

order to defend their interests (Beyers at all 2008). In this paper I’ve tried to analyze

the evolution of the energy and climate legislative proposal and the different position

of the two interest groups during the years. As argued by Baumgarther and Leech the

policy environment in which proposals are formulated affects interest groups’

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preference attainment (Baumgartner and Leech 1998). For this reason, in order to

understand why the Union decided to make such a deep change on its energy and

climate policies I think it is important to analyze which was the context when they

were adopted.

Eventually, I’ve decided to focus on the formal institutionalized contacts with

policymakers and on the outside strategies of the two interest organizations to

identify what were their position, what were their reactions and how they tried to

influence this political process during the first years as well as recently.

LOBBYING STRATEGIES

In every lobbying competition there are different factors that can influence the

outcome of a policy debate. Policymakers need expertise and information and one of

the main explanatory factor of an interest group’s ability to gain access is its

capability to produce and supply these public goods (Bowen, in Gullberg, 2013).

Furthermore, every interest group has to face a large number of challenges that do

not depend directly on its action such as, for example, environmental interests,

development concerns or the pressure of international trade negotiations. On the

European context there are different legislative steps and some are more

approachable than other. The early stages of EU policy-making offer the best policy

influence opportunities for interest groups. During this phase stakeholders are

formally invited to express their preferences and provide policy input based on their

interests and expertise (Bouwen, in Gullberg, 2013). The early agenda-setting stage

and the consultation period organized by the European Commission (EC) are the

most favorable points of the policy-making process during which interest

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organizations can affect the content of European legislation (Bunea, in Gullberg

2013).

EU 2020 DEBATE

In the matter of energy and climate policies it is possible to see the influence of the

renewable energy sector since the beginning of the legislative process. In January

2004 the possibility to increase the production of renewable energy was presented in

a position paper with the title “Renewable Energy Target for Europe- 20% by 2020”

published by EREC. This organization gathers the most important renewable energy

association and EWEA was one of the founding member and a member until 2013.

The opportunity to increase the renewable energy sector was presented as the

solution to several challenges that were in the spotlight at that time as the global

warming and the reduction of the dependence on energy imports and the increasing

of security supply (EREC, 2004). Furthermore, in another position paper entitled “The

share of renewable energy in the EU”, the energy strategy was presented as in the

European interest and the paper stressed its technically and economically feasibility.

However, official consultation with stakeholders were included in the policy making

process through public consultations on the Energy Green Paper and the Strategic

European Energy Review between March and September 2006 (Gullberg, 2013). The

different interest groups participated in those public consultations and in forums set

up by the Commission in which they exposed their different positions and concerns.

Renewable energy lobbyists expressed all their support on the new targets and they

tried to influence the Commission in order to make them even more ambitious, while

the conventional energy groups expressed their doubts on it. Apparently,

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EUROELECTRIC is in favor of more sustainability and, as described on its website,

they “are strongly committed to reducing carbon emission and meeting EU’s climate

targets for 2020 and its 2050 climate vision”. Despite that, at the time of the first

proposal it was one of the strongest opponents of the new target approach among

the conventional energy groups expressing all its skepticism during the consultations.

It stressed the risk that such targets could have been against the liberalized energy

market and the possibility that they could have not been cost-effective (Gullberg,

2013). Usually interest groups try to combine inside strategies with outside strategies

in order to have more influence and get more access on policymakers.

EUROELECTRIC tried to change the focus of attention from the supply side to the

demand side publishing a report entitled “Pathways to carbon-neutral electricity” in

which it called for a “market-based approach”. Furthermore, the society’s president of

that time Lars. G Josefsson said at the European parliament that: “The key to

Europe's low-carbon future will be on the demand side, where a paradigm shift is

needed away from direct use of fossil fuels to energy-efficient electric systems –

including electric road vehicles and electric heat pumps”. Obviously, this report was

criticized by the renewable energy groups, which refused the report’s assumption that

the renewables would have accounted to just 14% of the energy demand in 2020

instead of the 20% committed by the EU renewables directive. (ENDS, 2015)

From the other side, the renewable industry sector was no less so in the debate

offering expertise and information to policymakers through statistics and market data

and influencing the discussion and the public opinion through position papers and

media. Every year EWEA publishes an annual report that contains all the activities of

the organization and the research data through which they explain what they expect

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from the institutions (EWEA 2008,2009,2010). It only needs a quick read of one of

them to understand the positive position of this organization regarding the EU 2020

strategy. In the 2008 report they even said that “For the wind power sector, the

Renewable Energy Directive part of the legislative package was what everyone had

been waiting for”. And still, in the same report, it stressed that the role of EWEA is to

push for appropriate and effective legislation in order to permit to its sector to

increase (EWEA, 2009). Furthermore looking at the 2009 report it is clear to

understand that they also used a combination of inside and outside strategies to

increase they access on policymakers. Using their words, they were present in all the

key energy and climate debates, meeting with decision makers and influencing

European policy. They organized their biggest annual European Wind Energy

Conference ever and they were regularly quoted in the media (EWEA, 2009). Looking

at the EWEA response to public consultation it is possible to see the effort of this

interest group to pressure policymakers for even more ambitious goals. For example,

in in its response to public consultation towards a new strategy for Europe 2011-

2020, the main focus was on the implementation of the 2009 Renewable Energy

Directive in order to increase competitiveness, energy security and fight climate

changing at the European level. Even though the pressure by the renewable energy

industry began early in the decision-making process, as argued by Gullberg, it is not

possible to conclude that the industry exerted influence in the sense that it caused

the EU to adopt a renewable energy target that it would not have been adopted if the

industry had not lobbied early (Gullberg, 2013). The attention to climate change and

renewable energy production was high at the time of the first proposal while the

financial crisis had not yet fully developed. Furthermore, this proposal saw the

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support of several of the main countries, most of all the support of Germany and its

Chancellor Angela Merkel that in that time was called the “climate chancellor”.

However, even if probably the ambitious 2020 goals were not only approved because

of the strong capability of renewable energy interest groups to make pressure to

policymakers, what is clear is that certainly the renewable energy sector did not miss

the opportunity to push its proposals when the policy window was open (Gullberg,

2013).

EU 2030 DEBATE

Regarding the recent debate, the EU 2030 framework was approved by EU leaders

the last 23th October. They agreed of a greenhouse gas reduction target of at least

40% compared to 1990 and to increase the share of renewable energy consumption

to at least 27%. The European Council endorsed these targets, which are binding at

the EU level (European Commission, 2015). Even if the new targets seem to be more

ambitious compared to the previous ones, they faced several critiques both from the

renewable and conventional producers. Obviously, they have different position on

them. While renewable energy producers complain against the mediocre

achievements, the old industry still protest against the new targets. If the agreement

of a binding EU target of an at least 40% reduction in greenhouse gas emissions by

2030 is to be welcomed for most of the stakeholders, the most critique regards the

much less ambitious energy efficiency target of 27% by 2030 that is even minor

compared with the at least 30% target promised by president Junker during his

confirmation hearing at the Parliament (ENDS, 2015). EUROELECTRIC, regarding to

the new climate and energy framework has expressed severe criticism. The main

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message of the association in response to the European Commission’s consultation

in 2013 can be summarized by the words of its Secretary General Hans ten Berge:

“Inefficient policies today are unnecessarily raising costs for businesses and

consumers. The EU cannot afford to continue down this road” (EUROELECTRIC,

2015). Still, one of the most critiques by the conventional energy interest group was

against the distortion of the liberalized market. As they said in an interview, subsidies

for mature renewable energy technologies must be phased out. The trade association

urged the EU executive to take action against many renewable energy subsidies “well

before 2020” inasmuch they argued that they are distorting energy market and they

could endanger security of supply (ENDS, 2015). Furthermore, EUROELECTRIC

together with other conventional energy producer like IETA today are lobbying in

order to achieve a “mandatory and harmonized” EU compensation measures to fully

offset the costs of the EU emissions trading scheme (ETS) to industry (ENDS, 2015).

The ETS is a system that works by putting a limit overall emissions from high-emitting

industry sector. The paradox, in this situation, is that the renewable energy sector is

equally disappointed with the new EU targets although in a completely different way.

The wind energy association stressed the weaknesses of the 27% target and its first

comment after the publishing of the new package was that: “The EU commission has

turned its back on jobs, leadership and energy security”. Furthermore a spokesman

of EWEA in an interview for ENDS (Europe’s environmental news and information

service) has expressed all the concerns of the association and has warned that the

markets in southern and eastern Europe are “likely to come to a standstill” as a result

of revised support schemes. In effect, the European Commission had called for an

efficiency goal of 30% but this goal was reduce to 27% and after the opposition of

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some countries such as the United Kingdom the new target will not be binding at

national level but only at EU level (Euractive, 2015).

CONCLUSIONS

What is clear after this research is that the interests of the two groups are strongly

related to the EU energy and climate legislative outcomes and that they use all the

tools at their disposal in order to get access on policymakers and to influence their

decisions. For what concern their strategies, what result is that they both combine

inside and outside strategies with the aim to increase their political power and to

defend their interests. First, they supply expertise and information through their

reports or by institutionalized contact with key political and administrative elites as by

the European Commission consultations. Secondly, when they see their interests to

be threatened they combine inside strategies with outside strategies and through

different media channels (such as interviews, press release or opinion papers) they

try to increase their influence. What also is clear is that the policy environment in

which proposals are formulated affects interest groups’ preference attainment. In a

first time the favorable context has seen the full support of the renewable energy

sector and a shy and hidden protest by the conventional one. However, with the

evolving of the legislative process, and probably because of the increasingly

weakening of the European economy, the voice of the conventional energy interest

group, in this case the voice of EUROELECTRIC has become more aggressive and

in the same time the renewable energy sector has to change its behavior and

strategies to defend its interest.

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http://ec.europa.eu/clima/policies/package/index_en.html

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ANNEX

EUROPEAN TRANSPARENCY REGISTER

NAME INTEREST GROUP TYPE kayword

Estonian Renewable Energy

Association (EREA)

Trade and business associations “renewable energy”

German Renewable Energy Federation (BEE)


EUREC- The association of European Renewable Energy Research Centres (EUREC)


European Forum for Renewable Energy Sources (EUFORES)

Non-governmental organisations “renewable energy”

Portuguese Renewable Energy Association (APREN)

Trade unions and professional associations

“renewable energy”

Renewable Energy Association Trade, business & professional associations


European Biomass Industry Associaton

Trade, business & professional associations


European Geothermal Energy Council


European Renewable Energies Federation asbl


European Small Hydropower Association



Akuo Energy Companies & groups “renewable energy”

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ECOHZ AS Companies & groups “renewable energy”

BKK AS Companies & groups “renewable energy”

ENEL SpA Companies & groups “renewable energy”

Euroheat & Power Trade and business associations “renewable energy”

European Landowners' Organization asbl

Non-governmental organisations “renewable energy”

European Wind Energy Association


Fortum Oyj Companies & groups “renewable energy”

Hydro Equipment Trade and business associations “renewable energy”

International Hydropower Association


Confederation of Danish Industry

trade/professional associations “energy package”

European Anti Poverty Network Non-governmental organisations “energy package”

Turboden Companies & groups “energy package”

Sandbag Climate Campaign Non-governmental organisations “EU 2020”

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Axpo Holding AG Companies & groups “EU 2020”

Dow Europe Companies & groups “EU 2020”

EnR network informal network “2020 renewable energy”

Ecofys Netherlands B.V. Professional consultancies “2020 renewable energy”

Energy Cities Non-governmental organisations “2020 renewable energy”

Alliance for Rural Electrification Trade, business & professional associations

“2020 renewable energy”

Carbon Recycling International ehf.

Companies & groups “2020 renewable energy”

Enel Green Power S.p.A. Companies & groups “2020 renewable energy”

Energy Globe Foundation GmbH Non-governmental organisations “2020 renewable energy”

Finnish Energy Industries - Energiateollisuus ry


“2020 renewable energy”

EURELECTRIC aisbl Trade, business & professional associations

“electricity”

European Solar Thermal Electricity Association


“electricity”

European Association of the Electricity Transmission and Distribution Equipment and Services Industry


“electricity”

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RECS International

Non-governmental organisations “electricity”

KEYWORDS

KEYWORDS N°

“2020 renewable energy” 8

“electricity” 4

“energy package” 3

“EU 2020” 3

“renewable energy” 20

Grand Total 38

TYPE OF INTEREST GROUPS INVOLVED ON THE DEBATE

TYPE N°

Companies & groups 10 informal network 1 NGO 7 Professional consultancies 1 Trade and business associations 17 Trade unions and professional associations 1 trade/professional associations 1 Grand Total 38

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FIGURE 1: INTEREST GROUPS INVOLVED ON THE DEBATE

Companies*&*groups*

informal*network*

NGO*

Professional*consultancies*

Trade*and*business*associa<ons*

Trade*unions*and*professional*associa<ons*

trade/professional*associa<ons*

Paper_InterestGroupsEnergyLobbies_04:2015

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