Election of EU energy commissioner proves thorny

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Spanish commissioner-designate for energy and climate action Miguel Arias Cañete faced tough questions at his audition hearing last week in Brussels. A large number of EU parliamentarians remain troubled by Cañete’s involvement with the oil industry and his future role in the European Union.

European Commission President-elect Jean-Claude Juncker unveiled his incoming team of 27 commissioners last month.

The European Parliament is currently holding hearings of the commissioners-designate, deciding on the candidates’ competence for the proposed posts. According to the procedure, commissioners-designate are firstly asked to provide written replies to questions from members of the European Parliament (MEPs), then are invited to parliamentary hearings, where they are specifically questioned by the parliamentary committees dealing with their portfolio.

Conflict of interests dominated the hearing

Cañete’s hearing on Wednesday was unsurprisingly blustery. Cañete, whom the U.K.’s Sunday Times newspaper named "Señor Petrolhead," has emerged as the most controversial candidate for the Commission due to his close ties with the oil sector.

Specifically, prior to the hearings it was revealed that Cañete, who until recently was a Spanish minister for agriculture, food and environment, owned shares in two oil companies. MEPs ordered him to sell them before he takes the EU energy and climate change portfolio.

Cañete’s declaration of financial interests posted on the European Parliament web page says that his 85.349 shares (the current value of which is about €188,246) at Petrolifera Ducar S.L and his 23.585 shares (€248,974) at Petrologis Canarias S.L were sold on September 18.

A debate has arisen about potential conflicts of interest and whether his future role as an EU commissioner for climate action fits with his recent role as president of two oil firms.

Friends of the Earth England, a British non-governmental organization (NGO) lobbying against the use of fossil fuels, wrote prior to the hearing, "In a few hours, a Spanish oil ‘baron’ could be in charge of climate in Europe." Other NGOs and stakeholders followed suit.

"Cañete clearly worked hard to present himself as the right man for the job," said Greenpeace EU director Jorgo Riss. "But he failed to cast aside concerns about his family connections to the oil industry and his poor track record as a minister in Spain.

"Eager to please a sceptical audience, Cañete said that he considered climate change an urgent problem and promised to support renewables. But he also backed coal and nuclear power, blurring the picture on where he stands on energy policy. By confirming him, the European Parliament would be backing a controversial candidate with an unclear vision."

Indeed, Cañete’s oil past dominated the hearing.

A Belgian MEP asked Cañete whether his past roles in the oil industry conflict with his future interests as an EU climate commissioner. Cañete replied the two companies he had invested in were only minor players in the oil sector, working in logistics. He also argued that he always promoted green growth while holding public positions in Spain and Europe.

MEPs grew particularly frustrated when Cañete, asked whether his brother-in-law runs the two oil companies, continued to avoid answering the questions. Finally, Cañete managed to reply that only his direct family (wife and sons) mattered.

Members of the parliamentary committee on industry, research and energy and the committee on the environment, public health and food safety also asked the commissioner-designate about his ideas for future policies.

Pros

The best message coming out of the hearing was that Cañete understands the expansion of Europe’s electricity grids as the cornerstone of the EU’s effort towards further energy market integration.

"We don’t have an internal market that works properly," however the solution to this problem is interconnecting our electricity networks just as the Nordic (Sweden, Norway, Denmark and Finland) and the Benelux (Belgium, Luxembourg and the Netherlands) countries and Germany do, Cañete said.

The problem, however, was mostly financial, he suggested. The resources are scarce and the list of grid projects waiting to get subsidized is far too long. For this reason, Cañete said, he would push the EU to allocate a higher budget to the purpose.

There is also a need for greater involvement and coordination of the member states’ transmission companies, which are the ones selecting and prioritizing the grid projects.

Interconnecting the EU countries is the solution to building the internal energy market, facing the bloc’s energy security concerns and even providing affordable electricity via the promotion of market competition, Cañete argued.

The Spanish commissioner-designate’s understanding of the importance of interconnecting Europe matters to the renewable energy industry. Interconnected electricity grids mean deployment of renewable energy at a high level also bolsters the security of a country’s electrical system by ensuring a stable energy flow.

Cons

The hearing’s down point was Cañete’s vague replies in most other questions concerning his policy ideas.

There was a lot of talk about the European Trading Scheme (ETS) for carbon certificates, which allows companies of various industry sectors to trade carbon allowances. Cañete said the ETS did not work in an optimal way and needed to be reformed. For this reason, he said, he would reach out to various stakeholders and together examine ways to improve the system and climate protection efforts in the member states and in the different economic sectors affected by the ETS. No concrete plan was revealed, though.

Asked about the EU’s role in the UN climate change summit next year in Paris, he pointed out the bloc would continue its firm leadership towards emissions savings and that a "new system of governance" was urgently needed. He promised to try to co-operate with big carbon emitters like China, India and the United States, but again no co-operation plans were revealed.

MEPs asked how the Commission planned to match renewable energy growth with the increased cost of electricity. Cañete pointed out that, should MEPs approve his candidacy, guaranteeing electricity supply at a reasonable cost would be the most difficult part of his job.

Again, no specific proposals were given. He suggested that new measures for energy efficiency would alleviate the problem because EU countries would save crucial amounts of power. And he also promised that in cooperation with other commissioners he would pursue measures against energy poverty, perhaps through welfare.

Cañete’s replies remained generally vague. There was no word about the fossil fuel industry subsidies nor an example of a renewable technology orientated program to alleviate energy poverty. Crisis stricken households in sunny southern Europe, for instance, could benefit from large net metering programs that would allow them to generate their own solar power at very little cost. Cyprus started such a program last year targeting low income households and it is set to continue.

The commissioner-designate furthermore said that battery storage was currently very inefficient and overly expensive, completely missing the fact that battery storage is a new emerging market expected to expand greatly in the coming years and to lower in costs. Japan has recently started a scheme of subsidizing households and businesses installing PV and battery systems.

Is Cañete the right person?

The European Parliament committees will soon assess Cañete’s competence for the post of energy and climate action commissioner. And although the Parliament can only vote on the Commission as a whole, a negative assessment of one of the candidates has at times led to the candidacy being withdrawn.

Cañete’s candidacy has attracted a storm of protests from the Parliament’s Greens and the leftist European United Left/ Nordic Green Left groups promoting the manifesto #StopCañete, which so far has signed up more than 80 MEPs, also from the group Europe of Freedom and Direct Democracy, and some MEPs from the Socialist group. A public petition to stop Cañete taking the job is also under way and at the time of this article’s publication, had attracted about 480,000 signatures.

Whatever MEPs decide, the EU energy and climate change portfolio needs a competent commissioner who fully understands it and pursues critical decisions. The commission posts were initially designed for technocrats with sound knowledge of their portfolios, although some cynics may argue the managerial skills of some oil company CEOs would be ideal for such posts.

So, is Miguel Arias Cañete, a Spanish politician, fit for the job? MEPs’ assessments need to consider whether he is capable of taking both objective and well-informed decisions.