A new European Commission is waiting in the wings. Energy is not the influential posting that it used to be but a new name with new responsibilities could well resurrect its importance.
The energy commissioner job used to be one of the most coveted in Brussels. The European Union was after all founded as the coal and steel community and for many years even after that name was dropped, energy’s core importance endured.
But the job has lost some of its lustre of late. Under Jean-Claude Juncker’s Commission, the job was merged with climate, which had been given its own department just a couple of years prior.
When Ursula von der Leyen unveiled the Green Deal as her executive’s flagship policy, the position was sidelined further. Incumbent commissioner Kadri Simson has been rather inconspicuous during her five years in the job as all the main decisions and policies were spearheaded by Green Deal boss Frans Timmermans.
Russia’s war of aggression against Ukraine and the energy security challenges it unleashed resurrected some interest, especially given that Simson is from Estonia and rightfully has more skin in the game than others.
But there were still rumours that von der Leyen would not even name an energy commissioner this time round and that it would instead be folded into another position. However, the president has decided to stick with tradition and has named a candidate.
Denmark’s Dan Jørgensen, a former climate minister, will take on the responsibility if he is approved by the European Parliament in the coming weeks. His appointment is likely, even if he will face tough questions during his hearing.
Jørgensen may face the unenviable task of succeeding Margrethe Vestager as Denmark’s representative in Brussels, but as far as the energy job goes, he is presented with a rather interesting opportunity.
His nomination came as a slight surprise to some and as a bitter disappointment to others: particularly those in the Czech government that had publicly lobbied for their candidate, Jozef Síkela, to get the job.
Síkela’s nomination-that-never-was had already been hailed by some EU politics and energy aficionados as the trigger for an atomic energy renaissance in Europe, as the Czech official is loudly pro-nuclear.
Jørgensen’s tenure is unlikely to yield anything significant in that regard, as Denmark does not have any nuclear plants and its laws currently do not allow for reactor construction.
The current government has stated that test reactors can be built in Denmark so long as they do not generate electricity but the idea that Copenhagen would allow focus and investment to be diverted at EU level from renewables like offshore wind – where Denmark is a market leader – is rather laughable.
Von der Leyen’s mission letter to Jørgensen instructs him to help scale up the so-called small modular nuclear reactor sector, a nascent technology that is not expected to be commercially viable until the 2030s.
The EU already launched an industrial alliance aimed at achieving this, so progress could be made under Jørgensen. Heavy-emitting industries with constant high energy demand are interested in the technology, if costs can be managed. It is a rather big if and a matter over which Brussels does not have much influence.
More importantly though, Jørgensen’s mission includes coming up with an action plan for affordable energy prices, an electrification strategy and a clean investment pact. The Dane will also be expected to help improve state aid rules to aid the energy transition.
These are incredibly important initiatives that are focused on issues that many lawmakers were elected to address when Europeans voted in June. That means Jørgensen will likely be able to count on a degree of support from the Parliament when needed.
New horizons
The energy commissioner job was expanded in the 2010s to include climate, which was duly spun off again under von der Leyen. The job has now been beefed up again to include a new responsibility: housing.
First confirmed by the president in July, the idea of a housing commissioner has been around for a while. Average rents have increased by a quarter since 2010 and house prices by a half, leading many cities and countries to speak of a housing crisis. EU-wide policies are sorely needed.
It was unclear whether there would be a dedicated housing commissioner or whether it would be added to the responsibilities of an existing position. If it were to be the latter option then which commissioner would get the new job? Cohesion? Budget? Intergenerational dialogue?
Adding it to Jørgensen’s portfolio looks to be a really shrewd move both because of the obvious links with energy and also his nationality.
On the former point, the building sector soaks up around 40% of the EU’s energy supply and accounts for more than a third of greenhouse gas emissions. If serious efforts are not made to address it, then the bloc will not meet its climate goals.
So giving one official oversight of both makes sense. New buildings need to respect strict sustainability criteria, old buildings need to be retrofitted to be more efficient and only those people that can afford to pay for these policies should feel the financial burden.
New rules that extend the bloc's emissions trading system to the buildings sector are also looming large. The social cost of carbon pricing needs to be managed, so making them a joint responsibility is again quite logical.
The fact that Jørgensen is Danish is also significant. Denmark’s housing policies are lauded the world over for being a model that many countries should seek to replicate or at least learn lessons from.
About 20% of Danes live in affordable housing thanks to a combination of factors like inclusionary zoning, innovative financial instruments and digitalisation. If even a small part of that recipe for success can be transposed to EU-wide policies, Jørgensen will be on to a winner.
Once confirmed by the Parliament, his first initiative will be an affordable housing plan, as well as a new investment platform for the sector. Sustainability will likely be woven into all this work. It has to be.
All told, the new energy commissioner’s prospects of making a significant contribution to the green transition and improving social conditions look good. If his duties gel well with those of other commissioners, it could well mark the revival of the energy job’s influence.
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