Retrospective application of legal rules in the European Union: recent practice in the energy sector

Abstract

The continual availability of energy is economically and socially essential, but is primarily reliant on private operators and investments to be maintained and developed. Investments in the energy sector are typically highly capital intensive and require long payback periods. This in turn calls for legal and regulatory stability for such investments by the legislator. While changes to laws are inevitable, such changes should be implemented prospectively and take into account the legitimate expectations attached to existing investments. In this article we analyse the recent practice of the EU to retrospectively apply legal rules in the energy sector. Our research shows that it has been common practice of the EU to grant transitional periods and grandfathering rights to allow market participants to adapt to the 'new rules of the game'. However, while this represents common practice, our research shows that this practice is applied with discretion and can even be misused in the pursuit of political objectives, violating established legal principles including legitimate expectations and legal certainty.

Utilization of Active Distribution Network Elements for Optimization of a Distribution Network Operation

“…Reactive power generated by DG units in the network is determined from the available measurements. Power losses in a time-discrete operation state are first determined for the initial conditions (P loss orig ), and then minimized through recalculation of power losses with altered active elements' settings (P loss ) as given in (1). Loads in the network are represented using the constant power loading model (CPM) and constant impedance loading model (CIM).…”

“…The fitness function q f un is formulated with the objective to minimize the power losses in a time-discrete point, i.e., in the form of a quotient between the power losses of a currently evaluated solution P loss and losses of the initial network operation P loss orig , as given in (1). During every evaluation of q f un in step (f), penalty p is applied if any of the defined constraints is violated, i.e., a search parameter not on a permitted interval x p,i / ∈ [0, 1] or the occurrence of undervoltages, overvoltages, or thermal overloading.…”

“…The European Union is transitioning towards a low-carbon society, driven by Directives and Regulations in the energy sector concerned with the promotion of the use of energy from renewable sources, with common rules for the internal market of electricity, with risk-preparedness in the electricity sector, and with energy efficiency [1]. Novel requirements for Distribution Network (DN) operation, presented in the "Clean Energy for all Europeans" package [2], prompt the development and integration of new elements, an electricity market, and services.…”

Energy as a weapon of war: Lessons from 50 years of energy interdependence

“…& Patel, 2019). Importantly, it only gives a cursory history of key developments in the EU's energy market and its institutional development and contestation between the European Commission and Russia (Andersen et al, 2017;Hancher et al, 2021;Ostrowski, 2022) while avoiding the bilateral relations of European states and Russia (Balmaceda, 2021;Gustafson, 2020;Högselius, 2013). Instead, I seek to build on the previous interdependency scholarship (Farrell & Newman, 2019;Franza & Van Der Linde, 2017;Graf, 2018;Keohane & Nye, 1989) to provide a macro-perspective of the conceptual framing that drove co-operation and co-ordination despite geopolitical tensions and energy security concerns (Nye, 2004;Szulecki, 2018b;Van de Graaf & Colgan, 2017).…”

“…This article does not address the complex history of Soviet and Western energy relations (Balmaceda, 2021; Gustafson, 2020; Högselius, 2013; Ostrowski, 2022), nor Russia's involvement in global oil markets (Bradshaw et al, 2019) expansion of supply, demand and speculation (Barsky & Kilian, 2004; Stevens, 1995) and technological changes (Plante & Patel, 2019). Importantly, it only gives a cursory history of key developments in the EU's energy market and its institutional development and contestation between the European Commission and Russia (Andersen et al, 2017; Hancher et al, 2021; Ostrowski, 2022) while avoiding the bilateral relations of European states and Russia (Balmaceda, 2021; Gustafson, 2020; Högselius, 2013).…”