28 June 2024

EU treaty reform must also be energy-related

Niels Henrik Hooge, NOAH Friends of the Earth Denmark

For some time, EU treaty reform has been on the agenda of the EU institutions and some of the biggest member states, but so far without real progress. In order for that to happen, European constitutional amendments pursuant to Article 48 of the Treaty on European Union (TEU) has to be proposed by either a EU member state, the European Parliament or the European Commission. A proposal has to be submitted to the European Council, which the Council then adopts by simple majority and subsequently convenes a convention that examines the proposals for amendments, followed by recommendations to and inter-governmental conference of representatives of all the EU member states. All member states then have to agree on the amendments.

A fair question would be, how significant the need for treaty reform really is? And the answer could be: more relevant than ever. The last major treaty amendment took place in 2007, which was the adoption of the Lisbon Treaty. Today, almost two decades later, the main drivers for treaty amendment are the EU enlargement process and the recommendations from The Conference on the Future of Europe.

In the first case, it is widely recognised, that if EU-27 expands to EU-31 or even EU-36, a streamlining of the decision-making process would be necessary that would require treaty reform. In this perspective, progress in the treaty reform process could be viewed as a parameter for progress in the enlargement process. In the second case, it should be noted that although the recommendations from The Conference for the Future of Europe presuppose treaty reform, they do not call for treaty amendment in the energy field. It should also be noted that about half of the EU member states have expressed its aversity to reform.

 

Everything is on the table

So, what should a treaty amendment process include? This is a relevant question, because if a constitutional amendment procedure under TEU Article 48 is established, everything is in principle on the table, and not only the afore-mentioned issues.

Announcements by member states and the European Commission have provided some information on this topic: in a speech in Prague in 2022, the German Chancellor Olaf Scholz called for reform of the European treaties, partly in order to protect the EU’s decision-making process from being blocked by one or a few member states, and partly following the recommendations from The Conference on the Future of Europe. An almost similar message was delivered by the European Commission’s president, Ursula von der Leyen, in her state of the union address in 2023, where she emphasised her and the Commission’s support for the European parliamentarians who want to reform the EU to make it work better for citizens, including through a European convention and treaty change if and where it is needed.

More information on the possible content of amendments, which also includes amendments in the energy field, is provided in a European parliamentary resolution from November 2023. E.g., see paragraph 33 in the resolution:

“Calls for the creation of an integrated European energy union; suggests that the Union’s energy system must be affordable and based on energy efficiency, renewable energies and in conformity with international agreements to mitigate climate change;”

Among others, the above-mentioned is manifested in amendment 167 in the Annex to the resolution, where the current provision in TFEU Article 194, paragraph 2, subparagraph 2, is deleted:

“Such measures shall not affect a Member State’s right to determine the conditions for exploiting its energy resources, its choice between different energy sources and the general structure of its energy supply, without prejudice to Article 192(2)(c).”

This would by all standards constitute a clear signal for the end of nuclear at the European constitutional level, because it takes away the individual member states’ right to choose an energy mix that does not comply with the constitutional requirements.

 

The nuclear elephant in the room

However, there is a far cry from a European parliamentary resolution, adopted by a slim majority of MEPs, to the comprehensive constitutional reforms that would be needed, if the European Union is to be provided with a new overriding vision in the energy field corresponding to the demands of the Paris Agreement.

In order for this to happen, a sustainable European energy transition will have to rely on a new and different energy system, based on a stable framework for the long-term deployment of renewables in the European electricity markets.

First and foremost, as a minimum, a level playing field has to be created for the sustainable energy sources, which would also signify a level playing field at the constitutional level. This implies reform or abolishment of the Euratom Treaty that for more than sixty years has protected European nuclear power against competition from other energy sources. The treaty is crucial to the development and preservation of nuclear technology in Europe because of its constitutional and institutional legitimacy and its support mechanisms that help keep nuclear power alive.

Through its very existence, Euratom is important for the development and maintenance of nuclear technology in Europe, as well as through the institutional credibility and specific support mechanisms that it provides. The overall intentions of the Treaty can be seen in its preamble and in Article 1, which states that “nuclear energy represents an essential resource for the development and invigoration of industry” and that Euratom must create the conditions “necessary for the speedy establishment and growth of nuclear industries”.

Euratom provides a permanent boost to the economics of the nuclear industry by enabling direct and indirect financial support of nuclear power. Also, there is no decisional power by European Parliament on matters relating to Euratom and loans for nuclear power can be granted without consulting the Parliament. Half of the EU Member States do not have nuclear power programs, but – because of Euratom – pay for research and development in the field of fission and fusion. According to Green Budget Germany, EU has spent 13.7 billion euros on the Euratom program since 1984 until 2019.

Furthermore, the Euratom Treaty is not subject to the application of the precautionary principle or of the principles that preventive action should be taken, that environmental damage should be rectified at source or that the polluter should pay, which otherwise constitute the pillars of EU environmental law.

 

Reform or abolishment of the Euratom Treaty

In the past, six EU Member States – Austria, Sweden, Germany, Hungary, Ireland and Denmark – have noted that the Euratom Treaty has not been substantially amended since its entry into force and needs to be brought up to date. However, the most recent communication from the European Commission on Euratom reform falls far short of this demand.

In 2019, the Commission published a communication on EURATOM revision, stating that treaty reform should be seen in the longer-term, post-2025 perspective. A high-level group of experts should be established with a view to considering how, on the basis of the current treaty, its democratic accountability could be improved. However, the communication contained nothing about abolishing Euratom’s nuclear promotional dimension or touched on the many other issues that could be perceived as problematic.

So, what would be needed in order to see through real reform? One option could be to transfer responsibility for non-proliferation, nuclear safety, radiation protection, dismantling, waste management, cross border collaboration in safety and civil protection, etc. from Euratom to other EU institutions in cooperation with the International Atomic Energy Agency (IAEA). Also, to take responsibility for a strong nuclear liability regime and a powerful European Nuclear Safety and Security Inspectorate and Authority covering nuclear power plants and temporary as well as final nuclear waste storage under a unified regulatory framework, which could be introduced as an alternative to the IAEA.

Furthermore, Euratom’s research budget could be integrated into the budgets for other energy technologies in EU’s Framework Programmes for Research and Technological Development.

It would also be of crucial importance, that the European Parliament should be given co-decision and oversight authority in all basic questions, hitherto related to Euratom. As it is now, Euratom is beyond democratic control.

Finally, it should be noted, that if comprehensive EURATOM reform or abolishment of Euratom within a reasonable time frame is not possible, unilateral withdrawal from the Euratom Treaty by one or more member states could be an option.

 

The need for a Treaty on Renewable Energies, Energy Efficiency and Energy Saving

Because of the support of nuclear power, particularly renewable energies are put in an unfavourable position. Although their costs of are falling, neither the positive externalities of renewables, nor the negative externalities of the competing energy sources are sufficiently priced in the energy markets, which is detrimental to the growth of renewable energies. Furthermore, past support of nuclear power is already built into nuclear power’s infrastructure.

None of the measures so far proposed by the European Commission or adopted by the European Council are sufficient to reach the objective of the Paris Agreement to limit anthropogenic global warming to 1.5o or 2o C above pre-industrial levels. Particularly, implementation of EU’s green deal would need a framework in primary law in order to be successful in decarbonising EU’s energy system, which accounts for more than 75% of EU’s greenhouse gas emissions.

In this perspective, nuclear power is not a realistic solution to the climate crisis or an environmentally sustainable economic activity and should not be classified as such. In terms of greenhouse gases abatement efficiency per euro, particularly energy conservation and deployment of renewables are more effective than nuclear power. Before accounting for meltdown damage and waste storage, a new nuclear power plant costs 2.3 to 7.4 times that of an onshore wind farm (or utility PV farm), takes 5 to 17 years longer between planning and operation, and produces 9 to 37 times the emissions per unit of electricity generated. Furthermore, the systemic impact of nuclear power is an obstacle to the development of ambitious demand side policies and renewable programmes everywhere. The problems facing nuclear power – accidents and proliferation risks, waste management, potential terrorist attacks, etc. – must also be taken into consideration.

All this leads to the anchoring of obligations for the EU to adopt appropriate measures in its primary law by defining binding targets at the national as well as the European level in order to promote energy savings, energy efficiency and achieve a gradual increase in the share of energy from renewable sources in the Union’s energy consumption – i.e. to the adoption of a Treaty on Renewable Energies, Energy Efficiency and Energy Saving. It could be argued that such a treaty would be necessary even if the Euratom Treaty is reformed or abolished, and particularly if it is not.

 

The European Energy Transition Protocol

The good news is that a proposal for a Treaty on Renewable Energies, Energy Efficiency and Energy Saving already exists: In February 2016, the Austrian government presented a proposal for a protocol to be annexed to the Treaty on European Union and the Treaty on the Functioning of the European Union. The initiative, triggered by the Paris climate agreement, intended to anchor a European energy transition at the constitutional level by pursuing policy goals for renewables, energy efficiency and energy savings, promoting research and investment, and supporting EU member states’ activities in these areas.

The fully drafted text, which has the Energy Union as background, represents a considerable “added value” compared to existing European law: it introduces new institutions and substantive rules through an expansion of pre-existing, mainly secondary and extrajudicially consolidated norms, which it confers with primary law status. In many cases, obligations are introduced, where previously only competences were mentioned.

Among other things, the protocol commits the EU to:

  • Set binding targets for renewables and energy efficiency and gradually increase the share of energy from renewable energy sources throughout the EU’s energy supply.
  • Set binding national targets for renewables and energy efficiency with a view to achieving EU’s collective targets and the duty of the EU member states to adopt national action plans with the necessary measures and to provide regular information on this.
  • Create the framework conditions for the promotion of joint projects between two or more member states.

If the protocol was to be adopted, the member states would still have the right to determine the structures of their energy supplies themselves, but the energy transition’s requirements for the integration of environmentally friendly forms of energy would become part of all their policies and initiatives, which would need to aim for a high level of environmental protection. The European Commission would have to play a more active role and in its functions be obliged to promote a high degree of energy efficiency and saving, e.g., in development, coordination and financing of R&D programmes.

The EU institutions would also have to promote measures that make energy markets more flexible both on the supply and demand side in order to prepare for more integration of renewables and to take into account the development opportunities for small and medium-sized enterprises and independent energy producers. Furthermore, the Union and the member states would have to come up with suitable tools that could stimulate investments in renewables, energy efficiency and energy savings, and the member states would have to include mandatory considerations on this in their public tenders.

Russia’s illegal war against Ukraine, partly financed by exportation of fossil and nuclear fuels to Europe, and the insufficient measures in the EU to promote renewables, energy efficiency and energy saving since the introduction of the protocol in 2016, have made protocol more relevant than ever.

Unfortunately, even though the Austrian government initiative has won support in some member states, including those, which actively support Euratom reform, it has only received limited attendance. If a treaty amendment procedure is initiated, the protocol could, however, gain new political relevance.

 

Switch of treaties

Taking into consideration that it is not enough either just to reform or abolish the Euratom Treaty or adopt a Treaty on Renewable Energies, Energy Efficiency and Energy Saving, and that any campaign to reform the EU treaties in the energy field “must walk on two legs”, a concept of switch of treaties has been developed by an Austrian expert of international and constitutional law, Prof. Dr. Michael Geistlinger, from the University of Salzburg. In this enterprise, he was inspired by the results of the conference Energy Transition in Europe: Options for Constitutional Reform, organised by NOAH Friends of the Earth Denmark and others in 2018.

In his treaty draft, Prof. Geistlinger sets out to integrate the key elements of the Austrian government’s energy transition protocol directly into the Euratom Treaty, thereby fundamentally changing its character and providing for a switch of nuclear energy to renewable energy in Europe. The idea is to end the inconsistent parallel systems of an EU being a world-wide leader in protection of the environment and keen to fulfil the climate goals on one hand, and a Euratom being dealt with by the same bodies, disregarding environment and climate goals.

Thus, the switch of treaties implies a gradual replacement of Euratom by the EU focussing on renewables, a gradual phasing out from nuclear power all over Europe, gradual liquidation of Euratom, provision of safety guarantees for the phasing out period, and gradual transition of nuclear phasing out into the overall EU energy system. At the end of this process, EU will cover all energy at the constitutional level and all energy will be renewable.

 

The prospects for treaty reform in the energy field

In the mid and long term, the timeline for treaty reform, irrespective of its content, ultimately depends on developments in the accession process. The fact that the negation frameworks for the accession negotiations for Moldova and Ukraine – the latter in the EU perspective by far the most important of the candidate countries – have now been greenlighted, could be a step in the direction of treaty reform.

However, in July this year, the Belgian EU presidency, which was expected to speed up accession and treaty reform, will be replaced by a Hungary presidency, in regard to which expectations are low. EU presidencies come in blocks of threes, and in the next block with Poland (first half of 2025), Denmark (second half of 2025), and Cyprus (first half of 2026), Denmark and Poland have already signalled their opposition to treaty reform. In addition, at least 11 other member states until now – Bulgaria, the Czech Republic, Croatia, Estonia, Finland, Lithuania, Latvia, Malta, Romania, Sweden, and Slovenia – have been against reforming the treaties.

The far right-wing winds that are currently blowing across Europe, are not helpful either: in addition to their environment and climate scepticism, the radicalised right-wing parties are Eurosceptics and oppose any amendment to the treaties that could benefit European integration.

The good news, at least for energy-related treaty reform, is that the European Union is built on crises and that the biggest crises of all – the environmental and climate crises – at some point will make it inevitable for Europe to adapt to the demands of the Paris Agreement, including at the constitutional level.

In conclusion, it must be emphasised that process, politics, strategy and tactics matter. Considering that Euratom is an energy treaty, it would make political, strategic and tactical sense to include all energy-related proposals for constitutional reform simultaneously in the amendment procedure, if and when it emerges: the EU needs a new overriding vision in the energy field, which only a treaty on renewables, energy efficiency and energy saving can provide; there is a substantial need for a stable framework for the long-term deployment of renewables; and in a negotiation situation it would make sense to have as many sensible options on the table as possible in pursuing a sustainable green European energy transition.