1. Unconventional Gas and EU Energy Policy
Unconventional Gas and EU Energy Policy
Brussels, 14th April 2011
Michael Schuetz
Policy Officer Indigenous Fossil Fuels
Disclaimer: This presentation is a working-level input on unconventional gas and not an official position of the European Commission. Should you wish to obtain a political statement or for media related purposes please contact the Commission's press service or the Commissioner's spokesperson.

2. Gas in EU Energy Mix
Source: Eurostat

3. EU-27 Import Dependency in % OIL GAS 2005 2008 2020 2030 2005 2008
100 80 60 40 20
in %
2005
2008
2020
2030
2005
2008
2020
2030
94,1%
92,7%
84,3%
82,8%
82,4%
75,9%
62,3%
57,7%
OIL
GAS
(based on 2009 baseline scenario)

4. The January 2009 Gas Crisis and its Impact (6-20 January 2009)
The January 2009 Gas Crisis and its Impact (6-20 January 2009)
% of missing gas supply – 300 mcm/d for 14 days
> 75 % %
25 – 50 %
< 25% 0%
Ukraine | 4

5. Initial Commission assessment:
Unconventional gas could strengthen domestic production and contribute to security of supply
EU will still have to import most of its gas
Further presentation:
Commission energy policy priorities and their relation to unconventional gas
European Union legal framework for unconventional gas projects
Specific activities of the Commission on unconventional gas

6. Commission Energy Policy Priorities
Focus on implementing agreed policies (internal energy market, security of gas supply, energy efficiency, Renewables Directive)
Energy Strategy 2011 – 2020
Energy Infrastructure Package
Energy Efficiency Action Plan
Communication on External Energy Relations
Energy Roadmap 2050

7. Third Internal Market Package
Non-discriminatory access to networks is an essential condition to allow fair competition between suppliers
Regulation on conditions for access to the natural gas transmission networks (Gas Regulation)
Regulation establishing an Agency for the Cooperation of Energy Regulators (ACER Regulation)
Directive concerning common rules for the internal market in natural gas (Gas Directive)
Regulations took direct effect on 3 March 2011

8. Energy Infrastructure Package
Energy Infrastructure Package
November 2010: Communication on
Energy infrastructure priorities for 2020 and beyond
Challenges faced in each sector (electricity, gas, oil, CCS)
Strategic planning and proposal for set of tools
2011: Legislative proposal to create a facilitating environment for private and public investments in energy infrastructure
Unconventional Gas and EU Energy Policy, Michael Schuetz, 14/04/2011 | 8

9. European Infrastructures Priorities Gas and Oil 2020
Southern gas corridor
Baltic energy market inter- connection plan
South-North gas interconnections in Western Europe
North south gas & oil interconnections in Central & South East Europe

10. Energy Roadmap 2050
Support transition to low-carbon energy system in 2050
Focus on energy security, competitiveness as well as decarbonisation, throughout transition
Identify European-wide perspective
Support from scenario analyses – but scenarios cannot be read as policy options
Low Carbon Economy Roadmap came first (8 March)
Conclusions on energy policy challenges will be in Energy Roadmap 2050
Public consultation until 7 March
Informal Energy Council 2-3 May
Adoption planned for end of 2011
European Council commitment to reduce GHG emissions by 80-95% compared to 1990 levels (if by developed countries as a group)

11. Principles of EU Policy and Legislation
Principles of EU Policy and Legislation
Member States have right to determine exploitation of energy resources and energy mix (Art. 194 TFEU)
Member States are free to set more stringent environmental protection measures than required by EU-legislation (Art.193 TFEU)
Subsidiarity
EU-Directives transposed and implemented by Member State.
Often EU-Directives set objectives, but means are up to the Member States | 11

12. Legal Framework on EU Level
Legal Framework on EU Level
Existing legislation covers all hydrocarbon exploration and production (conventional and unconventional)
Hydrocarbon Directive
Water Framework Directive, Groundwater Directive
Environmental Impact Assessment
REACH (Chemicals)
Natura 2000
Other (waste, noise…)
Within this framework Member States have to ensure appropriate licensing and permitting regimes
Unconventional Gas and EU Energy Policy, Michael Schuetz, 14/04/2011 | 12

13. Assessing the Potential
“In order to further enhance its security of supply, Europe’s potential for sustainable extraction and use of conventional and unconventional (shale gas and oil shale) fossil fuel resources should be assessed.”
[European Council 4. Feb. 2011]
Economically recoverable potential ?
Following ongoing projects
Explorations in EU just started
JRC literature study focusing on economic impact
Review of the evidence

14. Assessing Environmental Impact
Exchange with US
Agreed at EU US Energy Council Nov. 2010
US only country with extensive experience
First activity: conference on 14 March 2011
Legal Study
Evaluate appropriateness of EU legal framework
Including environment issues
Based on cases in selected Member States
Possible good practices

15.  Conclusions Best use of indigenous (fossil) fuels important
Economically viable potential unclear
Other security of supply policies remain necessary
Environmental concerns: credible answers needed
EU has legal framework in place
Member States have to ensure appropriate licensing and permitting regimes
Important: Innovative companies
EU Commission works on further improving gas market conditions and gas infrastructure | 15