Impact of Renewable Energy Legislation of the EU on the reform of Georgian energy law Volume 1 - Issue 3

Maia Melikidze¹* and Irakli Samkharadze²

• ¹Associate Professor at Business and Technology University, Commissioner at Georgian Energy Regulatory Authority, RES Lab founder, Georgia
• ²Researcher at Renewable Energy Sources Laboratory (RES Lab), LLM. Rotterdam, Ph.D. in Law, Deutsche Gesellschaft fur InternationaleZusammenarbeit (GIZ), Regional Programme Advisor, Georgia

Received:November 30,2020   Published: January 19,2021

Corresponding author: Maia Melikidze, Associate Professor at Business and Technology University, Commissioner at Georgian Energy Regulatory Authority, RES Lab founder, Georgia

DOI: 10.32474/JBRS.2020.01.000113

 

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Abstract

The present document reviews major legislative aspects of the Georgian renewable energy reform.Results of the research is based on so called Desk Study and information received from processing of the secondary data. Applying quantitative method, processing and analysing of the statistical data, that are received from the reliable sources - information publicly available and requested from organizations.International experience regarding above mentioned topic is examined and necessary components are identified which are necessary for rehabilitation of the global tourism industry after the pandemic.

List of literature includes academic articles from international abstracted publications, legal and sub-legal acts of the country, strategic documents, results of the relevant international researches, information requested from the state structures.

Keywords: Nanowires; thermoelectric; photovoltaic

Introduction

Nowadays, world’s energy community is establishing[1-2] new order of eco-thinking, that envisages replacing existing traditional [3]energy resources with renewable sources. New rules and methods give advantage to the low-carbon energy, that is produced by minimal[4] impact on the environment. Firstly, it is achieved by respecting to the principles of the sustainable development.

There is no energy [5]development if it doesn’t comply with the sustainability criterias. On the top of it sustainable development strategy (Agenda 2030) of the United Nations, as an [6]international instrument. 7th aim of [7]universal sustainable development of the UN. It is a call for sustainable energy future. The concept of the sustainable development is [8-9]the basic of sustainable energy, that draws an attention to the balancing of efforts for economic development aims and environmental protection. It is an interesting fact that establishment of[10] sustainable development concept is connected to forest sector of 18th century and sustainable forest management, though many other dimensions and social factors were added to it.

Sustainable development is a popular term. However, it is pretty hard phenomenon, that [11]is not still totally properly defined in[12] research literature. Over the years many definitions were offered and the term ‘’sustainable development’’ has been a subject of various interpretations. It can be seen as a balancing obligation between, from the one side, [13-14]development connected with the technique, from the other side, environmental and nature protection. Most frequent definition of ‘’sustainable development’’, that is widely used today, comes from the [15] speech “Our Common Future” in 1987 (Brundtland Report): “Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.” (so called: generation equality principle).

Manual of the sustainable development is allocated in the major law of the country. Article 29 of the Constitution of Georgia reviews environmental protection rights and request the government to envisage interests of the current and future generations[16]for the purpose of the rational utilization of natural resources and environmental protection. The Law of Georgia on Environmental Protection also envisages principles of the sustainable[17] development, that shares the spirit of the Constitution and preaches the establishment of the system of social development, when economic development does not damage natural resources. The law states: “An increase of the quality of human life and the[18] right of future generations to enjoy the natural resources and environment that are maximally protected from irreversible qualitative and quantitative changes.“

Logic of the sustainable energy is identical and it [19] encourages the type of energy order, that will protect right of the future generations, in order them to enjoy unlimited and uninterrupted energy resources. Sustainable energy principle shall be the manual of modern energy law. In this[20] respect, it is worth to mention Energy Law’s Seven Principles, elaborated by Heffron and other energy scientists (Heffron and others.,2018):

a) The Principle of National Resource Sovereignty

b) The Principle of Access to Modern Energy Services

c) The Principle of Energy Justice

d) The Principle of Prudent, Rational and Sustainable Use of Natural Resources

e) Principle of the Protection of the Environment, Human Health & Combatting Climate Change

f) Energy Security and Reliability Principle

g) Principle of Resilience

Importance of the renewable energy

Idea of renewable energy regulation is not novel phenomenon; however, [21]establishment of its theoretical basis is new thing. Scientific interest toward this field is increasing every day in Europe and the USA, it establishes in educational[22] programs of the law schools and demand for qualified employees is pretty high.

Though, in this regard Georgia cannot claim to be on the top position: there is lack of research papers not only about renewable energy, but also about the general energy law, Georgian energy law literature is very limited and an academic consensus regarding the energy low does not exist.

Utilization of renewable energy sources occurs[23-24] at fast speed. It happens due to several reasons: irreversible process of traditional energy sources’ reduction, climate change, pollution of the air and environment, improvement of the energy security, popularization[25] of sustainable development, diversification of domestic energy resources and etc. Development of renewable resources promote creation of new workplaces, that increases number of employees working at generated energy units on local level. According to the Resolution[26] of European Commission of 2012 promotion of renewable energy can create more than 3 millions workplace in Europe. Number of enterprises working on clean tech is increasing at incredible rates.

However, it doesn’t give a reason to be completely optimistic. If development and utilization of renewable energy was easy, probably, [27]majority of the world population would utilize it and the debates over the bad impact of the climate change would be put to an end. Elaboration [28]of renewable energy policy and establishment of its regulatory standards is pretty complex and complicated.

It unites major directions of different policies and comprises four following components:

a. Regulations and standards

b. Quality tools

c. State procurement

d. Price related tools

Envisaging mentioned components in policies of different countries is necessary and important precondition for high-quality utilization [29]and development of renewable energy sources. It is rather hard technical and economic process, which is related to huge financial resources. Besides the fact that technologies are getting cheaper, nowadays in some regions renewable energy generation is more expensive than production and purchase of the traditional energy.[30-31]Over the many years, renewable energy projects were considered to be doomed for more failure than the fossil fuel installations. This point of view caused lack of strong financial investments in this field. Due to this, for promoting utilization and development of the renewable energy, elaboration of an adequate national politics and establishment [32]of legislative, regulatory environment is necessary. Each country has its own mechanisms and supporting schemes for the renewable energy sources’ development. For instance, the EU especially supports elaboration of renewable[33] energy policies and establishes special supporting schemes. It includes various promotion tools and I will discuss about it in more details below.

Developing national supporting schemes costs quite expensive. Roughly, price of renewable energy development and resources spent for[34] its popularizations is almost equal to the price of annual energy importation of Europe. The question arises: why does Europe need development of renewable energy if it can purchase energy from the energy-rich countries for[35] almost the same price (or even less)? Developing renewable energy sources is not only means of environmental protection. It promotes accomplishment of the aims, determined by Kyoto Protocol. Moreover, it also promotes benefiting from various socio-economic advantages. It also releases dependence on the energy import. And encourages technological progress.[36] Hence, promotion of renewable energy shall be considered as an opportunity for lowcarbon economic development, where innovative researches and modern developments are applied.

Renewable energy in European Union

European citizens are proud to be considered as ecologically clean and energy effective nations. They are, without doubt, different from other nations due to their loyal[37] attitude towards the principles of sustainable development and generally, regarding clean energy. Though, Europe is one of the leading geographical region for its harmful greenhouse gas emissions, it is also leader in fight of the negative impacts of the climate change. According to Bechberger, promotion of renewable energy sources is the only right direction for strategic energy development of Europe, that will reduce greenhouse gas emissions and energy dependence of the EU on other countries. Promotion[38-39] of renewable energy generation on European continent started at the end of 80th and the beginning of 90th. Before wide usage of renewables had not taken the place. Even the Oil Crisis of 1973 did not have any impact of this situation.

Therefore, first indication of the alternative[40] energy in the EU legislation originates from 1986, when the European Council adopted a resolution, where it discussed replacement of conventional energy resources with renewable ones. More specific steps were mad in 90th: in 1996 the European Commissions adopted Green Paper[41] with the name of: “Energy of Future: Renewable Energy Sources.” In 1997 White Paper were added to the Green Paper, which elaborated first renewable energy strategy of the EU and prepared kind of action plan.

Listed activities were followed by wide public discussions in Europe during the next few months, for the purpose of determination of priority directions[42] of renewable energy politics. It is evident that those processes caused frustration in some member states. European Commission received around 70 complaints, against the new renewable challenge, from member states. [43]Majority of complaints were sent particularly by industrial organizations, professional and regional associations, institutions and nongovernmental organizations. Certainly, countries with rich fossil fuel and socalled industrial society tended to be more in opposition. They supported coventional energy resources – coal, oil and utilization of natural gas. And opposing development of new energy vison of the EU. 90th attempts passed without fundamental transformations. Europe[44] presented primary visions about renewable energy, though; it did not establish compulsory legislative regulatory conditions.

Related particular activities started from the next century. In 2001 the EU adopted a directive, about promotion of generated energy from renewable energy sources. [45] The directive established primary target indicators for member states and presented support schemes. In 2003 one more directive on renewable energy was added to the European legislation, which regulates utilization issues of biofuel (major renewable fuel for transportation) and other renewable fuels.

Directive (2009/28/EC) on Renewable Energy in Europe

The Directive 2009/28/EC on the Promotion of Utilization of Energy Generated from Renewable Energy Sources (hereinafter “Renewable Energy Directive” or “The Directive”) can be estimated as the culmination of the progress of EU[46] politics related to renewable energy field, that came into a force in July, 2009 and requested incorporation by the member states into their national legislations by December, 2010. The Directive, along with the energy efficiency issues, is the mechanism for achievement of the Strategy 2020 of the EU, for this purpose it establishes compulsory target indicators for the member states.

The Directive is considered as the beginning for new era of renewable energy, which was presented within the framework of the European Climate and Energy package in 2009. Expect the above mentioned directive, the package also includes other[47] important legislate acts, such as the Directive of the EU on the Emission Trade Schemes (ETS),Directive regarding the Specification of Fuel and others. Nowadays the directive is the main active legislative document in the field of renewables in Europe.

The directive on renewable energy was adopted before the Lisbon Treaty came into the force. Accordingly, the only energetic norm of the EU with constitutional character – article 194, can’t be considered as its legislative base. The directive was founded[48] within the framework of the environmental protection legislation and was adopted on the basis of article 175 of founding treaty (Environmental protection). That is why the Renewable Energy Directive is regarded as energy specific legislative act of Environmental Protection Law (envisaging the climate change as air pollution aspect). It is quite logical, since renewable energy refuses[49] fossil fuel and its generation doesn’t have an impact of the climate change or other negative effects on the environment. The directive elaborates foundational legislative definition of renewable energy and equally concerns three major sub-directions of the renewables, that is calculated by total final consumption of the energy: electricity, heating-cooling and transportation.

Regarding the legislative technique the directive is characterized by many specific details, that makes it unique from existing alternative energy instruments. Renewable energy directive establishes compulsory target indicators and it is a replacement of the “first generation acts (2002/77/EC and 2003/30/EC). It is based on the logic of “comprehensive attitude” and totally envisages modern manual principles of the modern energy law. The Directive is the main legislative document of the renewable energy, that Georgia has an obligation of its implementation[50] within the determined time frame. Appendix XXV of the Association Agreement discusses about it, moreover article 20 of foundation document of the Energy Community and Minutes of Georgia’s Unification.

Furthermore, we should also mention, that the European Green Deal envisages adoption of the new legislative framework, that cannot be left without an attention. With so called “Winter Package” the Directive (2018/2001) of renewable energy was adopted. It made 32% growth of the renewables legally compulsory and replaced an important directive of 2009.

Besides the existing changes, Renewable Energy Reform of Georgia is based on the[51] above-reviewed directive of 2009. Stipulated by the fact, that this directive is part of the Association Agreement between Georgia and the EU and is envisaged by the minutes of joining the Energy Community.

Accordingly, changes envisaged in the “Winter Package” (so called “the Dynamic Harmonization”) adopted by the[52] EU, shall become obligatory for Georgia, in case the Energy Community requests it and issues compulsory act for its implementation. Content of the Association Agreement is almost the same, where its article 417 directly points out, that “the Dynamic Harmonization” shall be requested by the Council of the Association.

Conclusion

The present research paper concerned the importance of the renewable energy and reviewed its historic development in European Union. Afterwards, it specified the Directive of the EU of 2009 and concluded that it is a central tool for the harmonization of Georgian renewable energy legislation. Regarding this, it is important to highlight two legislative acts adopted in Georgia last December: Law of Georgia on Energy and Water Supply and Law of Georgia on Promotion of Production and Utilization of Energy from Renewable Sources. In other words, a specific law that is a beginning of the new order in renewable energy field. We should also pay an attention that the Clean Energy Strategy of the EU shall have a direct impact on Georgian renewable energy reform. Which comprises number of important legislative acts, as well the above mentioned new renewable energy directive (2018/2001) of the Winter Package. It is announced that the mentioned directive, so as other legislative acts, is supposed to become compulsory to implement for all member states of the Energy Community (i.e for Georgia as well) from the first half of 2021. However, it is not known still which specific form of cooperation Georgia will have with the Energy Community. It is important, that Georgia already is on the significant stage of the renewable energy legislation reform, that requires an additional stimulation from the state, as well from private and non-governmental sector, scientific and academic circles.

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