President Markkula, distinguished Members,

Thank you for your invitation. It is a pleasure to be back here at the Committee of Regions, this time in my current capacity as Vice - President for the Energy Union. President Markkula and I met in March, shortly after his election, but it was important for me to come here today to address your plenary.

The Energy Union is in full motion, as I will explain in a moment, and your contribution and involvement are of paramount importance for the success of this integration project.

As you know, the overarching objective of the Energy Union is to bring Europeans energy which is secure, competitive, and sustainable.

This will be achieved by building an internal energy market, based:

• on solidarity among Member States and cross-border flow of energy;
• on diversifying our sources and suppliers and better negotiating our future energy contracts;
• on ensuring we put energy efficiency first;
• on decarbonising our economy,
• and on leading the global energy transition through research and innovation.

These were the building blocks of the Strategy which the Commission adopted back in February. Since then it has been welcomed across industries, political groups, Member States, and institutions including your colleagues at the EESC and of course from many of you in this chamber.

This brings me to the draft opinion paper which your ENVE Section published last week, and which I understand you will adopt in October. I very much welcome the paper and your involvement in this very important debate. I fully share some of the priorities raised in the paper, namely: the focus on consumers, promoting energy efficiency, protection of vulnerable consumers, the priority of adequate interconnections and infrastructure, innovation as a booster for employment and the importance of the external dimension.

The next steps to advance these concerns will not linger. In fact, next week the Commission plans to adopt legislative proposals on ETS and Energy labelling, alongside Communications on electricity market design and delivering the new deal promised to energy consumers. We look forward to a constructive discussion with other EU institutions – including the Committee of Regions – on these initiatives and on the ones to follow.

I also took note of your legitimate concern that local authorities be involved. Let therefore reassure you: I am personally convinced local authorities have a huge potential as a driving force of the change we are talking about. It is also the political line of this Commission as you heard from President Juncker when he addressed your plenary last month. But above all, there is no other way to bring about the energy transition other than working with the local authorities.

The energy transition is all about decentralisation of our energy production, turning consumers into prosumers, increasing efficiency of residential buildings, smartening our cities, encouraging cross-border cooperation and ensuring adequate cross-border infrastructure. The local authorities and cities are therefore indispensable and will play a major role in this change!

As you know, back in May I launched the Energy Union Tour through which I attempt to convey, in person, what the Energy Union could bring for each of the Member States. Given the particular needs, challenges, and opportunities of each country, it is important for me to explain to the different European stakeholders how they would benefit from the Energy Union.

Throughout the Tour I have not only met with national governments, industrialists, civil society and citizens. I have also consecrated a great deal of my time to meet with mayors and federal ministers, in order to see how we can support them and where we can create spill-over effects of best practices. To give you a few examples:

• I had the pleasure of joining the mayor of Budapest's 12th district for visiting the smart building of a cultural centre, made possible thanks to a smart financing scheme and EU funds;
• I met with the mayor of Turin in order to discuss how we can promote cooperation and knowledge sharing of Smart Cities;
• I had a fascinating tour across the German Land of Lower Saxony and the Dutch northern region, with members of both regional governments who presented their cross-border cooperation on renewable energy;
• Finally, last week I met for the second time with the Covenant of Mayors at the World Summit of Climate and Territories in Lyon. I will join them again in October for the launch of the 'New Covenant', bringing together thousands of mayors from around the world.

As you can see, it is not just a matter of conviction that the local and regional levels should be at the heart of the Energy Union; it is a reality on the ground.

When it comes to the involvement of the Committee of Regions in energy-related issues, I am very glad that you already have very good working relations with the Commission. I encourage this cooperation to continue and intensify, especially when it comes to Smart Cities and Communities, smart financing, and the work of the Covenant of Mayors. I also welcome your involvement in the Energy and Management Authorities network (EMA), co-established by the Commission's DG ENER and DG REGIO.

Finally, your ambition to expand your cooperation on energy-related issues, outside the EU is also very welcome. I am referring specifically to the Conference of the Regional and Local Authorities for the Eastern Partnership (CORLEAP), the Euro-Mediterranean Regional & Local Assembly (ARLEM) and the initiative to expand the Covenant of Mayors. Europe must play its role on the international arena, especially when it comes to our climate policy. The exchange knowledge at regional level with our partners around the world is invaluable given that this is the level at which many of the relevant decisions are taken and implemented.

Let me say a few words about the European Fund for Strategic Investment (EFSI). I know that President Juncker came here last month to discuss the Commission's Investment Plan. In the meantime the Plan has been approved by the Parliament and adopted by the Council so it is now operational.

This timing fits perfectly with the Energy Union. In the energy sector alone we are currently facing an investment gap of no less than €200 billion per year (across the EU). Connecting the Europe's transport corridors (TEN-T) requires an additional investment of €200 billion until 2020. The same is true for the entire transport sector and the need to invest in research and bringing innovations to the market.

The Investment Plan will therefore be instrumental for building a genuine Energy Union aiming at affordable, secure and sustainable energy. How? Although EFSI does not earmark any sectors, it does focus on some, including strategic infrastructure in energy and transport, as well as energy efficiency.

It is worth noting that among the projects which have been suggested for EFSI, energy and transport each accounted for almost 30% of the value. Projects which were already selected by the EIB include: renewables in Denmark, efficiency technologies in Italy, and transport infrastructure in Croatia – to name a few. The aggregation of projects is done by national promotional banks which are working closely with cities and municipalise to identify the most relevant projects.

I would like to conclude by saying a few words about energy security, a topic which I understand has dominated many of your discussions, and which is indeed critical. Let me remind you, I come from a country whose industry was entirely shut down back in the winter of 2009 when Slovakia was powered out. I have vivid recollections of its devastating impact. So what are we doing to prevent that from reoccurring anywhere in Europe?

When it comes to electricity, we have launched a Communication, back in February, which sets a 10% interconnectivity target among all Member States.

For some regions, this will require some significant investment but it will ensure Member States can rely on each other at times when demand surpasses supply. This is of strategic importance for certain energy-islands, notably the Baltic countries and the Iberian Peninsula. The Commission is therefore highly involved in major infrastructure projects of common interest. Finally, just like in finance, diversification is a way to reduce risk; we therefore encourage all countries to expand their mix of sources and suppliers.

As for gas, we are working on a revision of the Security of Gas Supply Regulation and an EU-wide strategy for LNG and storage. Here again, diversification of energy sources, suppliers and routes is crucial. We are therefore focusing on advancing the Southern Gas Corridor and liquid gas. We are also engaged in energy diplomacy in order to open up to new suppliers and better leverage our size when signing new contracts. My colleague, Commissioner ARIAS CAÑETE has been very active in this endeavour, especially in North Africa. Finally, let me reassure you that the ongoing trilateral negotiations which I have led between Russia and Ukraine do not endanger the supply of gas through Ukraine into the EU. This supply remains secure and talks will now continue for a longer term agreement.

I will stop here as I would like us to have enough time for a debate on the role and involvement of regions and cities in the Energy Union. Thank you again for your continued interest, ambition, and involvement. I am looking forward to your comments!