US-EU forum on transatlantic energy technology development

The European Commissioner for External Relations and European Neighbourhood Policy, Benita Ferrero-Waldner, has attended an EU-US Ministerial Troika meeting in Washington yesterday, alongside German Foreign Minister Frank-Walter Steinmeier representing the current EU Presidency, and High Representative Javier Solana. The agenda was dominated by external relations issues, after which Ferrero-Waldner attended a meeting bringing together US and European scientists, financiers and entrepreneurs to launch a US-EU Energy Tech CEO Forum to intensify Trans-Atlantic energy technology development. Amongst the entrepreneurs present were Vinod Khosla of Khosla Ventures, who has been investing heavily in cellulosic ethanol in the US and in Brazil.

US Secretary of State Condoleezza Rice opened the Forum by summing up the challenges for the future of energy supplies, energy security and global sustainability. Not surprisingly, the recently closed biofuels cooperation agreement between the US and Brazil was put forward as a sign of a new energy paradigm. In her speech, Ferrero-Waldner announced that the EU will host an international conference on biofuels on the 5th and 6th of July in Brussels that will be attended by President Barroso and President Lula.

A summary of the main points of the speeches offers an insight into how strentghened transatlantic ties on technology development, science, and energy policy may ultimately benefit poorer countries. And perhaps more importantly, this synergy may bring rapidly developing countries like China and India into a global partnership to tackle climate change:

• Energy is truly a global challenge - making a decisive impact on issues as diverse as security, diplomacy, development, and climate change. No one nation can address the global energy crisis alone. We need to work together to seize new opportunities to develop cleaner and more efficient sources of energy and to prevent the global and rapidly growing demand for energy resources from generating unnecessary confrontation in the years ahead.
• This is one of President Bush's highest priorities, and he has identified five key goals that will drive our policies at home and serve as the beginning of our consultations with allies abroad. We seek: (1) to diversify world energy sources through free, open, competitive markets; (2) to encourage a variety of energy sources, including renewable and alternate fuels; (3) to use energy wisely through efficiency and conservation; (4) to expand strategic energy reserves; (5)and to protect the world's critical energy infrastructure.
• President Bush recently visited Brazil and launched a new partnership with the Brazilian Government in the area of biofuels [earlier post]. This agreement will transform the way we work together (1) to promote a critical alternative energy source, (2) deepening research and investment, (3) helping developing countries in our hemisphere and beyond to fuel their growth, (4) and working to enable more countries to supply energy for themselves and for others.
• The goal [of the Brazil biofuels cooperation agreement] is to promote the democratization of energy - increasing the number of energy suppliers, which expands the market, boosts competition, and reduces the chance of supply disruption.
• We are approaching an inflection point in history when science, technology, policy and free markets are all converging on new approaches to supply affordable, reliable and clean sources of energy. To seize this opportunity fully, we need to change the shape of the table, ensuring a seat not just for policymakers, but for leading scientists and most especially for the private sector. That is exactly what we are doing today, Americans and Europeans together, to spur new and innovative approaches.
• The United States and Europe are in a unique position to advance our common energy agenda both across the Atlantic and across the world. We share a common heritage which has generated many of the world's great entrepreneurs and many of its leading economies. We have the deepest and most innovative capital markets, seeding and growing many of the world's most innovative companies. We also have world-leading technical capacity to solve intractable challenges.
• Our discussion today will target three key areas of transatlantic cooperation. (1) First, we will canvass the most promising opportunities for increasing government-to-government collaboration. (2) Second, we will explore how we can build better and more extensive public-private partnerships. (3) And finally, surrounded by the leaders of many of the most prominent companies in the energy industry, we will discuss opportunities among the private sector participants to push the edge of the envelope of energy technology innovation.

German Foreign Minister Frank-Walter Steinmeier, whose country is holding the rotating presidency of the EU, stressed that climate change and technology transfers to non-Western countries will be crucial to ensure a clean and secure energy future:
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• This forum once again bears out, or is going to bear out, that issues to do with climate policy have very much moved to the center of international politics. There is a link between energy policy -- in external energy policy, climate protection, that is indeed a central topic for us in Europe and not only for us in Europe really, but it's become a very important topic in the United States of America, too.
• We touched on the overall context of this subject matter the weekend before last and when we met at the EU summit meeting. And the decisions that were then taken reflect this discussion. I think it's fair to say that as far as our positions are concerned on a future policy and energy and climate, we have indeed made major headway here.
• Only last week when we met with our ASEAN counterparts in Nuremberg, we met with countries who based their hopes on the fact that in the end they will not only become objects of appeal but that they will be integrated and included in these joint efforts undertaken by the United States of America and the European Union to do more for climate protection to further develop energy technologies.
• And that then at a later point in time those technologies will also be made available to regions like Asia. I think that that is something that when we intensify the cooperation between the United States of America and Europe that is something that we can indeed attend to. I think it's going to be decisive for cooperation.
• Both sides of the Atlantic are very active when it comes to the public but also to the private funds. A lot of these funds go into these areas. We are doing much more than we used to do in order to promote research and development of new technologies.
• When it comes to cooperation between the United States and Europe, I think we can try to attend to reducing unnecessary red tape and bureaucracy, making tendering procedures easier so that the innovative potential can be tapped in a better way than has been the case so far and we can cooperate even more than we've done so far.

EU Commissioner for External Affairs, Benita Ferrero-Waldner:

• When we work together, the European Union and the United States, then I think we can also bring in other very important players. I was in China and India recently and I mentioned also, very high on my agenda, these questions. And as you said with ASEAN there is great interest also with other players.
• First on technology, I think we must bring to the markets new options for renewable energies and also for low emissions transport. And by the third quarter of this year, the commission indeed will table a very comprehensive directive -- you have heard about it already -- on the use of renewables, including on biofuels, heating and cooling, and also renewable electricity. And with our U.S. partners, we have recently also agreed to put second-generation biofuels at the top of our joint research agenda as already has been mentioned. And we are working on streamlining our respective procedures in order to cut off the red tape, very important.
• We are on a track to a low-carbon economy and during this year, we shall complete specific legislative proposals to reduce CO-2 emissions, particularly in new vehicles. We shall further complete specific legislation on carbon captures and also storage.
• Second point on targets. Our experience shows that voluntary targets alone, unfortunately, cannot do the job. Hence, the landmarks decisions of 9th March, when we, the European Union, entered into binding commitments on CO-2 reductions and renewables. And these targets are ambitious, but we think they are doable. While setting caps and limits, we are also committed to market-based instruments, notably the emissions trading system or the version of cap-and-trade.
• Market-based instruments help companies to channel investment to those areas where the impact is highest and costs are lowest. Before the summer, therefore, the commission will complete the ongoing review of the EU emissions trading system. And ETS, as we call it, will then enable the European Union to collectively meet our obligations under the Kyoto protocol. This system will provide companies with a long-term regulatory certainty, which is important for U.S., we know, to implement investments in the most efficient manner. And we would like to invite the U.S. Government to consider creating jointly with us a common carbon market and transparent and compatible rules. And may I remind you that it was indeed the U.S. that successfully pioneered the cap-and-trade in fighting acid rain.
• My third and last point, international cooperation. If we join forces, as I said at the beginning, I think we have a great chance to bring the other international actors in there. And meanwhile, I think there is tremendous scope for our joint EU-U.S. cooperation, but we also can work together with countries like China, India, Ukraine, and Russia. And in our bilateral strategy, the energy dialogue -- I must say we can share information about complimentary approaches. We can go out to the Caspian Sea region, the Black Sea region, and we are very keen to do that together.

Condoleezza Rice added that the United States has had an Asia-Pacific partnership, which includes China and India, in an effort to marry concerns about economic development, environmental stewardship, and energy supply. It is a model the thinks works very well because the point that China and India will have to somehow be a part of any effort is obviously a very important one. The Europeans are more in favor of a truly global and multilateral partnership, headed by the United Nations.