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2018 | OriginalPaper | Chapter

5. Prosumers: New Actors in EU Energy Security

Authors : Rafael Leal-Arcas, Feja Lesniewska, Filippos Proedrou

Published in: Netherlands Yearbook of International Law 2017

Publisher: T.M.C. Asser Press

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Abstract

This chapter critically analyses the new challenges and opportunities that prosumers, as new energy actors, bring to achieving energy security goals in the context of the European Union (EU). Following trends in the EU towards new levels of cooperation in energy governance, decentralisation, and the emergence of a ‘gig’ economy, the energy sector is currently undergoing a large-scale transition. One of its core aspects is the progressive top-down diffusion of potential, competences, and leverage across the energy value chain from states and corporate actors towards prosumers. While this trend creates ample potential for facilitating and improving the EU’s security of supply, as well as fulfilling its climate change targets, several caveats exist. These caveats are not confined within energy security prerogatives; they also extend to the critical management of digital security, which the digitalisation of energy services brings to the fore. Private and public finance should be effectively attracted and directed to infrastructure schemes that will enable a transition from the traditional centralised power network to the decentralised nexus of smart grids. Technology will play a crucial role in facilitating the role of prosumers in the new market in the making.

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Footnotes
1
See for instance Clapham 2009, at 200–212; Halliday 2001, at 21–40; Josselin and Wallace 2001, at 1–20.
 
2
‘A gig economy is an environment in which temporary positions are common and organizations contract with independent workers for short-term engagements.’ (See WhatIs.com (2016) Definition: Gig Economy, updated May 2016, http://​whatis.​techtarget.​com/​definition/​gig-economy, accessed 12 October 2017.)
 
4
Leal-Arcas et al. 2015a.
 
5
For an overview of the current legal and policy situation in EU energy, see Leal-Arcas and Wouters 2017.
 
6
See generally Leal-Arcas 2017.
 
7
See for instance Leal-Arcas et al. 2016.
 
8
Leal-Arcas 2009.
 
9
The European Energy Union could well be the flagship of a new outset towards a more prosperous, energy-secure, and unified Europe, bearing in mind that EU Member States wish to guard their sovereignty over national energy systems. The aim is to make it easier to trade energy inside the EU. In the past, there have been divisions among EU Member States when trying to draft a unified energy policy. The European Energy Union tries to rectify this deficiency. For an analysis of the European Energy Union, see Leal-Arcas 2016a, at 12.
 
10
Szulecki et al. 2016, at 548.
 
11
See generally Leal-Arcas et al. 2014; The New Climate Economy (2014) Better Growth, Better Climate, http://​newclimateeconom​y.​report/​2014/​, accessed 12 October 2017.
 
12
One shocking environmental fact is that, in 2017, it rained in the Antarctica. See A Potenza (2017) Unusual Weather in Antarctica Leads to Rain and a Texas-sized Melt, The Verge, 15 June 2017, https://​www.​theverge.​com/​2017/​6/​15/​15811214/​west-antarctica-ross-ice-shelf-melting-rain-el-nino, accessed 12 October 2017.
 
13
See for instance UN, Sustainable Development Goal 7: Ensure Access to Affordable, Reliable, Sustainable and Modern Energy for All, http://​www.​un.​org/​sustainabledevel​opment/​energy/​, accessed 12 October 2017.
 
14
See for instance UN, Sustainable Development Goals Knowledge Platform, https://​sustainabledevel​opment.​un.​org/​sdgs, accessed 12 October 2017. See also Northrop et al. 2016; Hufbauer and Suominen 2010; Victor 2011; Sachs 2015, 2017; Matsushita and Schoenbaum 2016; Hufbauer et al. 2016.
 
15
Van Asselt 2014; Elliott 2013.
 
16
See UNFCC, Global Climate Action Nazca Platform, http://​climateaction.​unfccc.​int/​, accessed 12 October 2017.
 
17
Colchester 2016.
 
18
O’Rourke 2003; Brunsson and Jacobsson 2000.
 
19
Hatzopoulos and Roma 2017.
 
20
K Schwab (2015) The Fourth Industrial Revolution: What It Means and How to Respond, Foreign Affairs, 12 December 2015, https://​www.​foreignaffairs.​com/​articles/​2015-12-12/​fourth-industrial-revolution, accessed 12 October 2017.
 
21
Hatzopoulos and Roma 2017.
 
22
See the views expressed by Mark Parsons, Secretary-General of Research Data Alliance, in M Parsons (2017) Letters to the Editor, The Economist, 27 May 2017, at 20.
 
23
Ibid.
 
24
Hans Graux, Rapporteur to the European Cloud Partnership Steering Board (2014) Establishing a Trusted Cloud Europe, European Commission, 4 July 2014, https://​publications.​europa.​eu/​en/​publication-detail/​-/​publication/​b5c80ddb-fa1a-465b-a8f3-3e6c90af4a3b, accessed 12 October 2017, at 8.
 
25
Ibid.
 
26
See European Commission (2015) 7th Citizens’ Energy Forum Conclusions, 12–13 March 2015, https://​ec.​europa.​eu/​energy/​sites/​ener/​files/​documents/​2015_​03_​13_​LF_​conclusions.​pdf, accessed 12 October 2017.
 
27
See ERGEG, Position Paper on Smart Grids – An ERGEG Public Consultation Paper, E09-EQS-30-04, 10 December 2009, at 12; ERGEG, Position Paper on Smart Grids – An ERGEG Public Conclusions Paper, E10-EQS-38-05, 10 June 2010; European Commission, Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions: Smart Grids: from innovation to deployment, COM(2011) 202 final, 12 April 2011; CEER, CEER Status Review on European Regulatory Approaches Enabling Smart Grids Solutions (‘Smart Regulation’), C13-EQS-57-04, 18 February 2014.
 
28
Polinpapilinho et al. 2016, at 14.
 
29
Article 29 Data Protection Working Party, Opinion 04/2013 on the Data Protection Impact Assessment Template for Smart Grid and Smart Metering Systems (‘DPIA Template’) prepared by Expert Group 2 of the Commission's Smart Grid Task Force, 00678/13/EN WP205, 22 April 2013, at 5; Council of Europe, Committee of Ministers, Recommendation CM/Rec(2010)13 of 23 November 2010 of the Council of Europe Committee of Ministers to Member States on the protection of individuals with regard to automatic processing of personal data in the context of profiling, CM/Rec(2010)13, 23 November 2010, at 1.
 
30
CEER, CEER Status Review on European Regulatory Approaches Enabling Smart Grids Solutions (‘Smart Regulation’), 2014.
 
31
Rauch and Schleicher 2015; Koopman et al. 2015; Katz 2015.
 
32
Leal-Arcas and Filis 2013.
 
33
European Commission, Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions: A European agenda for the collaborative economy, COM(2016) 356 final, 2 June 2016.
 
34
Black 2001.
 
35
In terms broader than energy access, a quote attributed to Thomas Jefferson seems pertinent here: ‘That government is best which governs the least.’
 
36
See generally Leal-Arcas 2013.
 
37
Leal-Arcas and Minas 2016.
 
38
Leal-Arcas et al. 2015a.
 
39
Solorio et al. 2013, cited in Sànchez Galera 2017, at 13.
 
40
Orlando 2014, at 74.
 
41
Fujiwara 2016.
 
42
Leal-Arcas 2016b.
 
43
European Commission, Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions: Energy Roadmap 2050, COM(2011) 885 final, 15 December 2011, at 2.
 
44
European Council, Conclusions on 2030 Climate and Energy Policy Framework, SN 79/14, 23 October 2014, para 2.
 
45
European Commission, Commission Recommendation of 10 October 2014 on the Data Protection Impact Assessment Template for Smart Grid and Smart Metering Systems, 2014/724/EU, 10 October 2014, para (2).
 
46
Directive 2012/27/EU of the European Parliament and of the Council of 25 October 2012 on energy efficiency, amending Directives 2009/125/EC and 2010/30/EU and repealing Directives 2004/8/EC and 2006/32/EC, OJ L 315/1 (‘Energy Efficiency Directive’).
 
47
European Commission, Energy Union Package: Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee, the Committee of the Regions and the European Investment Bank: A Framework Strategy for a Resilient Energy Union with a Forward-Looking Climate Change Policy, COM(2015) 080 final, 25 February 2015, at 2.
 
48
Smart Energy Demand Coalition (2015) Mapping Demand Response in Europe Today 2015, http://​www.​smartenergydeman​d.​eu/​wp-content/​uploads/​2015/​09/​Mapping-Demand-Response-in-Europe-Today-2015.​pdf, accessed 12 October 2017, at 20.
 
49
Balijepalli et al. 2011, at 1.
 
50
Energy Efficiency Directive.
 
51
Ibid., Article 15(8).
 
52
Ibid.
 
53
For further details on the barriers to explicit demand response, see Smart Energy Demand Coalition (2017) Explicit Demand Response in Europe: Mapping the Markets 2017, http://​www.​smartenergydeman​d.​eu/​wp-content/​uploads/​2017/​04/​SEDC-Explicit-Demand-Response-in-Europe-Mapping-the-Markets-2017.​pdf, accessed 12 October 2017.
 
54
Smart Energy Demand Coalition (2015) Mapping Demand Response in Europe Today 2015.
 
55
See Moreno-Munoz et al. 2016.
 
56
Reuters (2013) Europe to Follow Italy’s Lead on Smart Meters, 30 May 2013, http://​www.​reuters.​com/​article/​energy-efficiency-smartmeters-italy-idUSL5N0EA3HL201​30530, accessed 12 October 2017.
 
57
The metering activity in Italy is regulated by the Regulation ARG/elt 199/11 (TIT).
 
58
Enel (2016) Enel Presents Enel Open Meter, The New Electronic Meter, 27 June 2016, https://​www.​enel.​com/​en/​media/​press/​d201606-enel-presents-enel-open-meter-the-new-electronic-meter.​html, accessed 16 October 2017.
 
59
See Italian Legislative Decree No. 102 of 2014, 4 July 2014; Italian Regulatory Authority for Electricity Gas and Water, Second Generation Smart Metering Systems for Low Voltage Electricity Measurement: Guidelines for Determining Functional Specifications in the Implementation of Article 9, Paragraph 3 of Legislative Decree 102/2014, 416/2015/R/EFL, 6 August 2015.
 
60
CEER, CEER Status Review on European Regulatory Approaches Enabling Smart Grids Solutions (‘Smart Regulation’), 2014, at 14.
 
61
‘Atrias wishes to develop together with the energy suppliers and the distribution grid operators a new market model and improved market processes.’ (See Atrias, About Atrias, http://​www.​atrias.​be/​UK/​Pages/​About.​aspx, accessed 12 October 2017.)
 
62
Energy Outlook (2016) Atrias and MIG6.0: Towards a New Energy Market Model in Belgium, 1 July 2016, http://​energy.​sia-partners.​com/​20160701/​atrias-and-mig60-towards-new-energy-market-model-belgium, accessed 12 October 2017.
 
63
CEER, CEER Status Review on European Regulatory Approaches Enabling Smart Grids Solutions (‘Smart Regulation’), 2014, at 14.
 
64
Ibid.
 
65
Ibid.
 
66
Ibid.
 
67
Ibid., at 19–20.
 
68
Ibid., at 21.
 
69
Ibid., at 15–16.
 
70
ERGEG, Final Guidelines of Good Practice on Regulatory Aspects of Smart Metering for Electricity and Gas, E10-RMF-29-05, 8 February 2011, at 12.
 
71
Ibid.
 
72
CEER, CEER Status Review of Regulatory Aspects of Smart Metering: Including an assessment of roll-out as of 1 January 2013, C13-RMF-54-05, 12 September 2013, at 16.
 
73
Upham 2016, at 549.
 
74
Parag and Sovacool 2016.
 
75
European Commission, Proposal for a Regulation of the European Parliament and of the Council on the internal market for electricity (recast), COM(2016) 861 final, 30 November 2016, at 4–5; P Szalai (2016) Power Grid Operators Expect Their ‘Uber Moment’, EU Observer, 29 September 2016, https://​www.​euractiv.​com/​section/​energy/​news/​power-grid-operators-expect-their-uber-moment/​, accessed 12 October 2017.
 
76
P Szalai (2016) Power Grid Operators Expect Their ‘Uber Moment’.
 
77
Leal-Arcas and Grasso 2016; Leal-Arcas 2015a; Leal-Arcas et al. 2015b, c.
 
78
Eid et al. 2016, at 10.
 
79
Ibid., at 9.
 
80
Clastres 2011.
 
81
Cai et al. 2016.
 
82
Boscán and Poudineh 2016, at 2.
 
83
Pew Research Center (2017) Mobile Fact Sheet, 12 January 2017, http://​www.​pewinternet.​org/​fact-sheet/​mobile/​, accessed 12 October 2017.
 
84
J Roberts (2016) Prosumer Rights: Options for a legal framework post-2020, at 5.
 
85
This approach is quite in contrast to the typical top-down way of trading energy. See for instance Leal-Arcas 2015b; Leal-Arcas et al. 2015c.
 
86
European Commission, Proposal for a Directive of the European Parliament and of the Council on the promotion of the use of energy from renewable sources (recast), COM(2016) 767 final, 30 November 2016.
 
87
Ibid.
 
88
Dinusha Rathnayaka et al. 2012. For further analysis on the link between behavioral sciences and government, see Sunstein 2016.
 
89
European Commission, Proposal for a Directive of the European Parliament and of the Council on the promotion of the use of energy from renewable sources (recast), 2016, at 10.
 
90
Boscán and Poudineh 2016, at 10.
 
91
Eid et al. 2016, at 3.
 
92
International Energy Agency (2016) World Energy Outlook 2016: Executive Summary, https://​www.​iea.​org/​publications/​freepublications​/​publication/​WorldEnergyOutlo​ok2016ExecutiveS​ummaryEnglish.​pdf, accessed 12 October 2017, at 3 and 5.
 
93
Varaiya et al. 2011, at 41–43.
 
94
Boscán and Poudineh 2016, at 7–8.
 
95
Varaiya et al. 2011, at 55.
 
96
Boscán and Poudineh 2016, at 9.
 
97
Ibid., at 2–7; Buchan and Keay 2016, at 6–9.
 
98
Proedrou 2016.
 
99
HEDNO, Regulatory Framework, http://​www.​deddie.​gr/​en/​i-etaireia/​ruthmistiko-plaisio, accessed 12 October 2017.
 
100
Proedrou 2017a, at 456.
 
101
IEA (2015) Renewable Energy Medium-Term Market Report 2015: Executive Summary, https://​www.​iea.​org/​Textbase/​npsum/​MTrenew2015sum.​pdf, accessed 12 October 2017, at 5.
 
102
On investment law and policy, see generally Leal-Arcas 2010.
 
103
Proedrou 2017b, at 194.
 
104
Verbong et al. 2013, at 123.
 
105
Government of Spain, Ministry of Energy Tourism and Digital Agenda, Royal Decree 900/2015, 10 October 2015.
 
106
Republic of Greece, Ministry of Environment and Energy, Decree 4414/2016, 9 August 2016.
 
107
Masson et al. 2016, at 13.
 
108
M Galanova (2013) Spain’s Sunshine Toll: Row over Proposed Solar Tax, BBC News, 7 October 2013, http://​www.​bbc.​com/​news/​business-24272061, accessed 12 October 2017.
 
109
EEA, Country Profile – Belgium, Energy Support 2015–2012, https://​www.​eea.​europa.​eu/​publications/​energy-support-measures/​belgium-country-profile, accessed 12 October 2017.
 
110
Wissner 2011, at 2509–2510.
 
111
Clastres 2011.
 
112
This is articulated in European Commission, Communication from the Commission to the European Parliament, The Council, The European Economic and Social Committee and the Committee of the Regions: Next steps for a sustainable European future: European action for sustainability, COM(2016) 739 final, 22 November 2016.
 
113
European Commission, Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions: Closing the loop – An EU action plan for the Circular Economy, COM(2015) 614 final, 2 December 2015.
 
114
See the proposal of senior Republican statesmen regarding a carbon tax in the United States (C Mooney, J Eilperin (2017) Senior Republican Statesmen Propose Replacing Obama’s Climate Policies with a Carbon Tax, The Washington Post, 8 February 2017, https://​www.​washingtonpost.​com/​news/​energy-environment/​wp/​2017/​02/​07/​senior-republican-leaders-propose-replacing-obamas-climate-plans-with-a-carbon-tax/​?​utm_​term=​.​1ceadf0fe007, accessed 12 October 2017).
 
115
See World Alliance for Efficient Solutions, http://​alliance.​solarimpulse.​com/​, accessed 12 October 2017.
 
116
Masson et al. 2016, at 13.
 
117
Lehmann and Gawel 2013, at 603.
 
118
Halasah et al. 2013, at 462.
 
119
See generally the proposal of the EU Commission (European Commission, Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee, the Committee of the Regions and the European Investment Bank: Clean Energy For All Europeans, COM(2016) 860 final, 30 November 2016). One should add that global CO2 emissions from energy use remained flat in 2016 according to a report of BP (See BP (2016) BP Statistical Review of World Energy, June 2016, https://​www.​bp.​com/​content/​dam/​bp/​pdf/​energy-economics/​statistical-review-2016/​bp-statistical-review-of-world-energy-2016-full-report.​pdf, accessed 12 October 2017).
 
120
BBC News (2017) Ukraine Power Cut ‘Was Cyber-Attack’, 11 January 2017, http://​www.​bbc.​co.​uk/​news/​technology-38573074, accessed 12 October 2017.
 
121
KT Weaver (2017) Smart Meter Deployments Result in a Cyber Attack Surface of ‘Unprecedented Scale’, Sky Solutions, 7 January 2017, https://​smartgridawarene​ss.​org/​2017/​01/​07/​cyber-attack-surface-of-unprecedented-scale, accessed 8 February 2017.
 
122
Polinpapilinho et al. 2016.
 
123
KT Weaver (2017) Smart Meter Deployments Result in a Cyber Attack Surface of ‘Unprecedented Scale’.
 
124
A Gurzu (2017) Hackers Threaten Smart Power Grids, Politico, 4 January 2017, updated 11 January 2017, http://​www.​politico.​eu/​article/​smart-grids-and-meters-raise-hacking-risks/​, accessed 12 October 2017.
 
125
Liu et al. 2012.
 
126
US Office of Energy Policy and Systems Analysis (2017) Transforming the Nation’s Electricity System: The Second Installment of the QER, January 2017, https://​energy.​gov/​sites/​prod/​files/​2017/​02/​f34/​Chapter%20​I--Transforming%20​the%20​Nation%27s%20​Electricity%20​System.​pdf, accessed 12 October 2017.
 
127
M Kuneva, European Consumer Commissioner, Keynote Speech, Roundtable on Online Data Collection, Targeting and Profiling, SPEECH/09/156, 31 March 2009.
 
128
Article 29 Data Protection Working Party, Opinion 04/2013 on the Data Protection Impact Assessment Template for Smart Grid and Smart Metering Systems (‘DPIA Template’) prepared by Expert Group 2 of the Commission’s Smart Grid Task Force, 2013, at 5.
 
129
Ibid.; Council of Europe, Committee of Ministers, Recommendation CM/Rec(2010)13 of 23 November 2010 of the Council of Europe Committee of Ministers to Member States on the protection of individuals with regard to automatic processing of personal data in the context of profiling, 2010, at 1.
 
130
‘Local Governments for Sustainability is an international association of local and metropolitan governments dedicated to sustainable development.’ (See UNEP Climate Initiatives Platform (2017) ICLEI – Local Governments for Sustainability, http://​climateinitiativ​esplatform.​org/​index.​php/​ICLEI_​-_​Local_​Governments_​for_​Sustainability, accessed 12 October 2017.)
 
131
M Watts, Planning for the Ecological Age – How to Evolve a City, A2 Magazine, Issue 7, https://​www.​arup.​com/​-/​media/​arup/​files/​publications/​a/​a2/​a2-issue-7.​pdf, accessed 20 November 2017, at 13.
 
132
By webbing, we are referring to connecting different issues in a broader policy approach rather than approaching them in silos.
 
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Metadata
Title
Prosumers: New Actors in EU Energy Security
Authors
Rafael Leal-Arcas
Feja Lesniewska
Filippos Proedrou
Copyright Year
2018
Publisher
T.M.C. Asser Press
DOI
https://doi.org/10.1007/978-94-6265-243-9_5