COMMUNICATION FROM THE COMMISSION TO THE COUNCIL, THE EUROPEAN PARLIAMENT, THE ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS - Comments of the Commission on the conclusions of the Mid-term Assessment of the Energy Framework Programme (1998-2002)

1. Introduction

In 1998 the energy policy related programmes - ETAP, SYNERGY, ALTENER, SAVE, CARNOT and SURE - were regrouped in a multi-annual Energy Framework Programme (EFP). With the present document, the Commission communicates to the European Parliament, the Council, the Economic and Social Committee and the Committee of Regions, the conclusions of the Mid-term Assessment of the Energy Framework Programme (1998-2002) and its comments on it, as foreseen by the Council Decision on the Energy Framework Programme [1]. The assessment covers the Community framework activities carried out during the period 1998-2001.

[1] Decision n° 1999/21/EC, Euratom, of 14 December 1998 (OJ L 7, 13.1.1999, p. 16), Article 5.2 states: "in the third year of the period of application of this framework programme and at all events before submitting its proposals for the establishment of a subsequent framework programme, the Commission shall have an external assessment conducted by independent experts of the overall implementation of the Community actions carried out under the framework programme. The Commission shall communicate the conclusions thereof, together with its comments, to the European Parliament, the Council, the Economic and Social Committee and the Committee of Regions".

The mid-term assessment was conducted by a committed Panel of high-level, independent experts, hereafter referred to as the "Panel", chaired by Mrs. Judith Stammers. The Panel has carried out a thorough study based on a large variety of inputs, including previous assessments of the specific programmes and the annual evaluation of the Energy Framework Programme conducted by Bureau van Dijk in the year 2000, which covered the activities implemented during the period 1998-1999. The report comprises an assessment of the efficiency, effectiveness and relevance, and sustainability of the specific programmes, taking into account time and money constraints. It also gives consideration to the co-ordination of the specific programmes, the synergies between them and the added benefit which the framework programme brings. The table below illustrates the diversity in size of the various programmes under analysis, as well as the management resources that were allocated to each of these.

Some overall data for the EFP specific programmes, 1998-2001

>TABLE POSITION>

The Panel expresses their views on future activities, including the overall framework architecture and the specific means of intervention. In performing their assessment, the experts took account of the wider political context in which energy policy takes place, in particular the Green Paper "Towards a European strategy for the security of energy supply" [2]. The Commission finds it particularly useful that the Panel has taken account of the latest overall political developments and initiatives, as well as energy policy related work carried out in the context of other Community policies (e.g. external relations, agriculture, regional, research).

[2] COM(2000) 769 final, 29.11.2000

In the following comments the Commission endeavoured to respond to all the proposals and recommendations highlighted in the report. In addition, brief comments have been made on some specific points relating to conclusions and recommendations made in the summaries of the specific programmes' assessments.

2. Main conclusions and recommendations

The Commission considers that the Panel produced a balanced and comprehensive report, combining recognition and criticism, and covering the whole framework programme activities. Four main messages emerge from the overall report:

- There is a real need for a new energy programme to follow on from the current EFP. It is recommended that the current framework programme should evolve to a single programme that retains three of its current areas of activity - energy efficiency, renewable energy, and international co-operation -, and includes an new, additional area on the energy aspects of transport.

- The new programme should be designed to take account of and influence the energy components of other Community programmes. It is recommended that the programme should be managed within a structure that assures that an effective guiding and co-ordinating role can be played.

- The EFP has virtually no public image and has been operating as six separate programmes. As a result, the links between the programmes were generally weak and hardly any synergy has been created. The exceptions are SAVE and ALTENER. At the same time, specific programmes were considered to be generally well run, funding good projects and producing useful outputs.

- In spite of sectoral achievements and successes, all six programmes were considered to suffer from a serious lack of resources, both financial and human. All programmes paid insufficient attention to dissemination of project outputs and impact assessment. The Panel considers that the future energy programme should be given a substantially greater budget than the 175 MEUR that the EFP has had for the period 1998-2002. Furthermore, consideration should be given to externalising the day-to-day management of the new programme, notably by means of establishing an agency for that purpose.

Commission response

In preparing its proposal for a multiannual energy programme "Intelligent Energy for Europe, 2003-2006" [3], the Commission has taken due account of the recommendations of previous EFP evaluations, as well as of the preliminary findings provided by the Panel in their interim report.

[3] COM(2002) 162 final of 9.4.2002 and COM(2002)162 final/2 of 24.4.2002

In this context, the Commission is proposing a single energy programme covering the four identified areas of activity in which the work programme will include detailed rules for co-ordination and linkage with other Community policies and Member States' actions in the energy field. The proposal also emphasises the need for more effective and systematic dissemination and impact assessment of future programme developments. However, the Commission is still examining alternative management structures in order to identify the most cost-effective solution for the implementation of the programme.

3. Future energy programme

The Panel recommends that a future programme should be established, to which a substantially greater budget than the 175 MEUR of the current EFP should be allocated. This programme should retain three of the six areas of activity of the current EFP, include an additional area on the energy aspects of transport and put significant effort into influencing, co-ordinating and orienting the energy components of other relevant Commission's programmes, as well as into liasing with Member States' programmes, international organisations, financial institutions and other stakeholders in other energy policy-related field.

The Panel considers that these ideas could be implemented by nominating a person, supported by a Unit, who would be responsible for the co-ordination of the energy components of other EC programmes and for the contacts with energy programmes and other stakeholders outside the EC. This position would have to be in DG TREN. Moreover, a Commission inter-services working group, chaired by the nominated person, should be set up involving representatives of those Directorate Generals whose programmes have energy components. The Panel further recommends that a formal procedure should be instituted for this body to screen the energy component of any EC programme. .

The Panel recommends that the future programme should provide funding for: (i) the above co-ordination Unit and any studies, evaluations, forecasts commissioned by them, estimated at Euro 20 million for 4 years; and (ii) four different work areas covering energy efficiency, renewable energy, international co-operation and the energy aspects of transport, corresponding respectively to 40%, 35%, 10% and 15% of the remaining programme funds.

Along these lines, the work carried out in the current Energy Framework Programme through ETAP that is relevant to the new programme areas should be managed by this co-ordination Unit and funded out of their budget. The remaining activities of ETAP should be dropped out of the future programme and the same applies to CARNOT and SURE type of activities.

Finally, the Panel recommends the Commission to increase the visibility of the programme and improve its image and invites the Commission to consider the possibility of externalising the day-to-day management of the four work areas of the programme, notably by setting up an agency for that purpose.

Commission response

The Commission endorses the view of the Panel that the limited resources available for the future programme should be concentrated in a reduced number of working areas that reflect current energy policy priorities. The Commission is convinced that the proposed concentration of activities can better contribute to raising awareness among the main players concerned so that they move towards more efficient and intelligent energy production and consumption schemes. Likewise, a unified programme covering the four thematic areas as proposed by the Panel will certainly bring a greater overall coherence and impact to the supported actions. It would also make it easier to introduce coherent management procedures, as well as to improve flexibility in the response to changing needs and/or priorities.

Within the framework of the programme, the Commission acknowledges the importance of focusing studies, evaluations and forecasts on the four thematic areas foreseen therein, though recognising the need to continue the Community support to more inter-disciplinary and energy sector-wide type of activities, such as modelling. Moreover, the Commission agrees that the work currently carried out by CARNOT and SURE specific programmes have no possible synergies with the four thematic areas that have been proposed and, consequently, activities in these domains should not be conducted in the framework of a single and integrated energy programme.

The Commission attaches the greatest importance to co-ordination and liaison of the programme with other Community policies with energy relevance, as well as to the development of actions complementary to and co-ordinated with those carried out by the Member States and other major stakeholders in the energy field. Main contributions in this context can be made by the members of the programme Committee with whom the Commission discusses matters related to programme management.

The Commission's inter-service co-operation and consultation take care that the actions in the energy field are realised in a coherent way. They will be also facilitated by the impact assessment mechanisms that have been recently adopted by the Commission in its "Better Regulation" package [4]. The Commission is fully committed to the improvement of the management of Community programmes towards best management practices and in line with Commission reform . The Commission will consider the suggestion of setting up an inter-service working group and will examine this proposal with the different services involved.

[4] COM(2002) 275 final, COM(2002) 276 final, COM(2002) 277 final and COM(2002) 278 final of 5.6.2002

On the question of setting up a co-ordination Unit and externalising daily management tasks, the Commission is still examining the different options available in order to identify the most cost-effective solution for managing and co-ordinating the programme and energy-related activities.

In the frame of the recently proposed new organisational chart for the Directorate General for Energy and Transport, the management of the multi annual energy programme, "Intelligent Energy for Europe" (2003-2006), will be concentrated within a unique directorate. This concentration will enhance, as recommended by the Panel, the co-ordination aspects and it will lead to the identification of a high-level person who would take on the responsibility for channelling and maintaining contacts with other energy related programmes and stakeholders outside the European Commission.

Where appropriate, and on the basis of cost-benefit considerations, the Commission may also decide to give specific tasks to other external bodies. Given the nature of the proposed programme activities, a first option would be for the delegation of certain programme management tasks to an executive agency with the exception of those involving a degree of assessment which would mean making political choices.

All in all, the Commission's proposal for a multi annual energy programme, "Intelligent Energy for Europe" (2003-2006), broadly reflects the above mentioned recommendations. However, as far as the budget breakdown per thematic area is concerned, the Commission is proposing to reverse the funding allocation between "energy efficiency" and "renewable energy" (35% and 40% respectively, instead of 40% and 35% as suggested by the Panel). In fact, the Commission considers that the majority of the activities to be conducted under "energy aspects of transport" are related to improvements in energy efficiency and to a much less extent to renewable energies.

4. Specific programmes/work areas

With regard to recommendations that apply to all EFP work areas, the Panel highlights the need to find ways of reducing the time that elapses from the close of a call for proposals/tender to the signature of a contract. The Panel also recommends that the Commission develops strategies for the targeted dissemination of project outputs and for a systematic impact assessment of the future programme results.

Commission response

The Commission recognises that the time lag associated with contract preparation has to be reduced. In preparing the Work Programme for "Intelligent Energy for Europe, 2003-2006", the Commission is fully committed to simplifying procedures, call and contract related documents, in order to make them more user-friendly and efficient, and to stimulating and facilitating the electronic submission of proposals. Moreover, the clarification and further delegation of responsibilities at different Commission levels will also speed up contract preparations.

The Commission is also convinced that the common procedures that result from a unified programme structure will further contribute to reducing this time lag. However, the Commission does not share the Panel's view that the consultation of the Programme Committee on the set of proposals recommended for support is one of the key contributors to the lengthy evaluation process. Programme Committee meetings are set in advance and are usually held approximately within one month following the evaluation by external experts.

On the subject of dissemination and impact assessment, the Commission proposes to allocate within each and every thematic area a substantial fraction of programme funding to these activities. The "Intelligent Energy for Europe" Work Programme will include an information strategy that favours comprehensive promotion and valorisation of results as well as the effective replication of best practices. The Work Programme will also identify concrete methods and instruments for systematic project and programme monitoring, notably through the generalised use of performance indicators.

5. Individual work areas of the future programme

The recommendations of the Panel for the individual work areas are presented in the Annex to this Communication.

Commission's response

The Commission appreciates the constructive remarks and suggestions made by the Panel and is committed to examining them in depth and ensuring an appropriate follow up of these within the context of preparing the "Intelligent Energy for Europe" Work Programme. Brief comments are presented hereafter on some of the specific points raised by the Panel.

The Commission fully agrees that Work Programme priorities should emerge from a large consultation process involving relevant stakeholders and Member States' energy administration. However, the Commission considers that this consultation should take place in the context of the Work Programme preparation (which includes a detailed roadmap of foreseen calls), but certainly not before each call for proposals.

The Commission is committed to publishing overall statistics on programme participation and to making all efforts to attract to the programme a diverse and renewed constituency, along with key energy stakeholders at national, regional and local level.

The Commission attaches the greatest importance to bringing about a genuine change in energy behaviour in the Community by raising awareness among the main players concerned, business and citizens in general by promoting exchanges of experience and know-how, by supporting actions intended to boost investment in best available technologies and by encouraging the spread of best practices and thus facilitate a general move towards more efficient energy production and use.

The Commission considers that existing promotion networks at Community and international levels, along with energy agencies, are important vehicles in this process and should play an important role in promoting and exploiting fully programme results and outputs. As highlighted by the Panel, these networks include the SAVE agencies but, in the Commission's opinion, they should not be limited to these.

The Commission agrees that assessment of the SAVE agencies should be a pre-condition for the continuation of Community support but does not share the Panel's view that more financial help should be given to the SAVE agencies at their start-up phase. An exception to this could however be the case of agencies in candidate countries. The Commission is in fact of the view that the Community support should rather be focused on concrete activities that designed to achieve precise energy policy objectives.

The Commission takes note of the Panel's suggestions regarding the organisation of annual meetings for the local and regional agencies and the creation of a award scheme for the best of these. The Commission further agrees on the importance of initiatives like "ManagEnergy", and on the need to continue and enhance these in the future.

The Commission views the international co-operation component of the future programme as a mechanism to support development co-operation, and to promote and facilitate investment in renewable energy sources and efficient energy use in the developing countries. This investment will help to tackle problems related to the expected growth in energy consumption in developing countries with its related impacts on the security of energy supplies and emissions of greenhouse gases from fossil fuel use. The programme will therefore contribute to poverty alleviation and to improving the quality of life of the populations concerned. The Commission's proposal is designed to create stronger institutional capabilities in these countries, as well as promote the mechanisms of the Kyoto Protocol, in order to encourage the use of sustainable energy sources and improve access to energy services by the energy poor [5]. In other words, and bearing in mind the limited financial resources for project funding, instead of continuing along the present Synergy lines, the Commission proposes to refocus the objectives, the areas of activity and the geographical coverage for actions under the new programme.

[5] The forthcoming Communication from the Commission on energy co-operation with developing countries in the context of the Johannesburg 2002 world Summit will also reflect these preoccupations.

The full report is available on request at tren-info@cec.eu.int.

ANNEX

Conclusions of the Mid-term Assessment of the Energy Framework Programme (1998-2002)

EXECUTIVE SUMMARY

This mid-term evaluation of the Energy Framework Programme (1998-2002) (EFP) was carried out during January to May 2002 by a Panel consisting of Bureau van Dijk, Professor Ugo Farinelli and Judith Stammers. Their mandate was to: analyse the efficiency, effectiveness and relevance, and sustainability of the six constituent programmes of the EFP (SAVE, ALTENER, SYNERGY, CARNOT, SURE and ETAP); consider the benefits that being part of the EFP has brought to them; and express views on future activities. In doing this the Panel was to take account of the wider political context in which energy policy takes place.

The delay with which the Commission initiated the evaluation means that the findings have not been able to influence the Commission's drafting of the new framework programme. It is hoped, however, that they will inform the debate on the Commission's proposals and be useful in preparation of the programme's future work plan.

The evaluation of the specific programmes of the EFP was based on interviews with the DG TREN programme managers and examination of documents provided by them. Previous external evaluations covering the early years of the programme, and overviews prepared by the management on what has happened since then, were helpful in providing the basic data. Telephone discussions about the EFP were held with some members of the EFP Programme Committee, a couple of members of the Energy Council's Working Group and a contact in the Candidate Countries. An understanding of the Commission's other activities relevant to EU energy policy was obtained from documents and interviews with officers in DG TREN, DG Research, DG Environment, DG Development, AIDCO, DG Regio and DG Agriculture. Interviews were also conducted with three Members of the European Parliament with a particular interest in energy.

The evaluators found that the specific programmes were generally well run by dedicated officers knowledgeable in their fields. Good projects were funded and useful outputs produced. However, all the programmes suffered from serious lack of resources, both financial and human, bearing in mind their very broad objectives. In attempts to overcome this, all programmes have in recent years encouraged submission of larger projects and published more focussed work programmes. Proposal evaluation became more rigorous and transparent over the years; different (but appropriate) procedures were used for the different programmes. As a result of complex procedures, the lead time between close of a Call and contract signature was generally far too long. Because of the lack of human resources, all the programmes paid insufficient attention to dissemination of project outputs and impact assessment. It is known that a number of projects have achieved a life after their EU funding finished but no attempt has been made to measure this systematically.

All the six specific programmes had been running for some years before they were brought together into the EFP. The Council Decision establishing them provided no budget for bringing the programmes together and achieving synergies between them. As a result the links between the programmes are generally weak and hardly any synergy has been created. The shining exceptions are SAVE and ALTENER which have developed an increasing closeness in the last two years. These two programmes - and, indeed, most of the other specific programmes - are well known throughout Europe. Few people outside the Commission have heard of the EFP or, if they have, confuse it with the Energy sub-programme of the Research Framework Programme. The EFP has virtually no public image.

The EFP's total budget for 1998-2002 is 170 M EUR. Much, much more is spent by the Commission on energy policy-related work outside the EFP than within it. Most of this is the responsibility of DGs other than DG TREN, e.g. DG Research, DG Regio and AIDCO (implementing DG Development and DG External Relations policy). Other DGs have an interest in energy policy-related issues although they have no specific funding for this, e.g. DG Environment.

From their work, the evaluators have concluded that there is a real need for an energy programme to be established to follow on from the EFP when the latter finishes at end-2002. They consider that the new programme should have a stronger image than was achieved by the EFP and be run in a more unified way. They regard it important that the programme should be the responsibility of DG TREN. They consider the programme should be designed to take account of and influence the energy policy-related work of all the other DGs. They feel it should also develop contacts with the many other stakeholders in this field - Member States, international organisations, financial institutions, etc. - without whom concrete activities that follow on from EFP-supported projects will not get off the ground and flourish.

Recommendations

The evaluators' recommendations are given below. The general recommendations concerning the future programme are given first. These are followed by recommendations that are common to all the specific programmes of the EFP and could be implemented in the future programme. Finally, key recommendations specific to the work areas to be retained in the future programme are listed.

General recommendations concerning the future energy programme

- An individual in DG TREN should be appointed to take responsibility for co-ordination of the energy components of other EC programmes, and for establishing and maintaining contact with energy programmes and other stakeholders outside the EC.

- A unit should be established to respond to the above co-ordinator, to carry out studies, evaluations, assessments, data collection relevant to these co-ordinating functions.

- An inter-services commission or working group, chaired by the above co-ordinator, should be created with representatives from the DGs whose programmes have relevant energy components, e.g. DG Environment, DG Agriculture, DG Regio, DG Development, DG External Relations, AIDCO, and DG Research.

- It should be formally agreed that the energy component of any EC programme should be screened by this body.

- The co-ordination with the other DGs and external institutions should not be a merely routine exercise. It should be pulled together and stimulated by clear objectives. Care should be taken that all participants draw advantages from the time and effort they put in.

- The future energy programme should be established as a single programme with funding for:

- the above co-ordination unit and any studies, evaluations, forecasts, etc., commissioned by them;

- four different work areas covering (a) energy efficiency (the area currently funded by SAVE), (b) renewable energy (ALTENER), (c) international co-operation (SYNERGY) and (d) energy aspects of transport (TRANSPORT).

- The work currently carried out through ETAP that is relevant to the new programme should be managed by the co-ordination unit and funded out of their budget. The remaining work currently funded by ETAP should be dropped.

- The work currently carried out by CARNOT should be dropped from the future energy programme and pursued through the European Community Steel and Coal programme.

- The Transport of Radioactive Materials (TRM) work currently carried out by SURE should be dropped from the future energy programme and pursued through the DG TREN nuclear waste management and decommissioning programme.

- The future energy programme should be given a substantially greater budget than the 170 M EUR the EFP has had over 1998-2002.

- Whatever the final budget figure, the following formula be used to establish the distribution of funds between the different elements:

- The co-ordination unit should have a budget of 20 M EUR for four years (5 M EUR a year on average) for the studies, evaluations, assessments, forecasts, etc., it would require to service its thinking and activities. These studies, etc., should be funded 100% to ensure that they match the unit's needs precisely.

- The remaining funds assigned to the energy programme should be distributed between the four specific work areas as follows:

- SAVE 40%

- ALTENER 35%

- TRANSPORT 15%

- SYNERGY 10%.

- Every effort should be made to increase the visibility of the programme and improve its public image.

- Consideration should be put to externalising the day-to-day management of the four work areas in some way, perhaps by establishing an agency for that purpose. This would free Commission staff to man the co-ordination unit and carry out the strategic work concerning the running of the four work areas.

Recommendations common to all the specific programmes/work areas

- A way should be found to reduce the time from close of a Call to contract signature. Methods considered should include: introduction of a simple fixed-fee type of contract when appropriate; enabling a project co-ordinator to sign on behalf of all project partners; introducing a special contract type for clustered projects.

- Strategies for targeted dissemination of project outputs should be developed and implemented for all the specific programmes. Dissemination of the outputs of individual projects should be started early during the project.

- Impact assessment should be seen as a systematic management tool. For new projects, procedures should be set up that involve project partners as the providers of information on impact. It does not have to be a 'heavy' exercise. Much can be learned from simple and efficient procedures. Impact assessment of all completed projects and programmes should also be carried out.

Key recommendations specific to the individual work areas of the future programme

SAVE

- To enable the most to be made of the available funding, the objectives should be more focussed. Before each Call, an independent study should be carried out with the active help of Member States to determine programme priorities in relation to the available budget.

- Analysis of the turnover in project proposers should be carried out to determine whether the right people are applying and whether the programme should be promoted more widely and/or in a different manner.

- There should be more overview reporting by the programme managers on the activities of the programme. These reports should contain comprehensive information so they can be used for assessment purposes.

- In the future, priority should be given to dissemination and impact assessment. In view of the large body of knowledge already generated by SAVE, dissemination should become a major element of the future programme.

- The SAVE agencies should play a strong part in dissemination of SAVE outputs and be given funding to do this.

- More direct help should be given to SAVE agencies at their start-up phase.

- An impact analysis should be carried out on SAVE agencies at the end of their contract with the Commission to find out the reasons for success or failure.

- Annual fora should be organised for SAVE agencies, awards being given to the best agencies.

- Initiatives like ManagEnergy that support the exchange of experiences should be encouraged. They could be of real help to the SAVE agencies and other interested parties.

- Better links should be made between SAVE and other energy and environment programmes at the national, European and international level.

ALTENER

- Because the programme budget is small, every effort should be made to achieve effective interaction and synergies between ALTENER and Member States' initiatives and policies on renewable energy.

- The dissemination activities carried out within projects should be monitored to determine whether they were carried out properly and the extent to which they were effective.

- The SAVE agencies should play a strong part in disseminating ALTENER outputs at local level and be given funding to do this.

- A way should be found to enable the OPET agencies to work in close relation to the SAVE agencies in disseminating ALTENER outputs.

SYNERGY

- The SYNERGY programme should be continued in future along the present general lines.

- The objective related to implementation of the Kyoto Protocol should be reformulated to encourage use of sustainable energy as a tool for economic and social development.

- Closer links should be established and maintained with other Commission programmes and with programmes of Member States, third countries and international organisations.

- Contracts should be established with international networks of study and research centres to define the contribution of these networks to achievement of the objectives of the action programme.

- Co-ordination and co-operation with international financial institutions and other sources of funds should be sought in view of the need for follow up of SYNERGY projects and application of their results once EC support is terminated.

- A representative from DG Development and/or AIDCO should participate in the committee for proposal evaluation and selection.