 Yeah, thank you very much for inviting me. I mean just to make it, you know I don't have a disclaimer and I'm trying something new not having slides But my background actually said, you know, it's it's a little bit Different. I'm I'm new at sink tank Territory my my background is electric power I spent 20 years in the Canadian power system in Ontario And I used to run the International Emission Training Association that David is is a CEO now A chair now, so it's a very very heavy corporate. I have to say that However, it's good now to be able to write about things without having to worry about reaching consensus in the business community and having to you know before you get up and say something everybody know what you're gonna say so So I'm free as a bird as they say but Yeah, we you know, we actually had a session yesterday at that saps Looking at the 2030 paper and one we had a guest from from Ireland Charing that meeting Frank Connery chaired that that meeting for for us at saps So we had a quite quite an interesting discussion and and Frank actually managed to extract a lot of wisdom Well, this was very very useful, but I'm coming back. We also or I also went through the Trying to understand as to what had to work and what hadn't work in in the EU climate and energy policy and The ETS in in in my mind, and I don't disagree with David Has worked and is still working and when you say worked I look at it from the point of view of Good market work functioning and would market functioning that way we clear definition or somewhat clear definition in terms of tight spreads and liquidity and Transparency and the ability to get in and out of the market Etc etc etc this has happened. There's no doubt about even in the worst moments of the ETS This has happened, but the worst moments have really not been very long They've been at the end of period one and then we but we knew we're getting into period two However, I don't know that this is the only be the case for much longer I think that what we you know kind of moving from one period of the other and not having banking has been masked by By this this this jumping between phases because what we see now We see variability in in prices of 10% a day I think both four or five times for the last three weeks 10% a day if you have 1300 on the Dow in one day somebody's gonna jump out the window and yet We are taking this in stride and we think it's normal, but I don't call this good market functioning And the kind of thing that you want to see in the market that drives your economy The second thing that I would also say that we've seen reduction quite clearly we've seen reduction But we don't really understand why we assumed that most of them have happened because of the economic crisis and At this point we start getting some sympathy for the Eastern Europeans, you know, remember some of you who follow the International negotiation they've been blighted by this term of hot air, which is very pejorative in my mind because we paid with a lot of hot Social misery in Eastern Europe and they you know, they don't forget that they said we paid for it But now we have Western European hot air in the ETS so we don't really know what the amount is due to reduction what your amount is due to To the impact of ETS that probably not much do the result of ETS The renewable has been successful beyond what we thought it would be Energy efficiency has been but much less so And we have seen the international impact of the EU climate change policy a reflection to some degree of the domestic policy As being somewhat successful and somewhat less so we've seen a kind of the impact of on the CDM and driving a price off of Carbon internationally and that becoming known as a cultural change an enormous success way beyond people what people understand But at the same time the the success of the EU in driving international climate change policy Has also been to some degree mixed in my own opinion You know Copenhagen hasn't been this disroaring success And I think we've made some some progress sense and the EU has managed to move the agenda in the international negotiation But what is also important the energy investment really has not been very successful because we've seen energy Investment going in the wrong places the only one that I think we're seeing that successful is that that was subsidized The only you know we see coal fire generation and the only the only generation that is renewable is because the subsidy and feed in Terrace, but otherwise I don't think that it would be there So now what do you know what? Having reflected on on kind of this what are some of the lessons learned of Of what we have seen because you know you have to learn from the past in order to be able to move successfully in the future first of all We need to understand that we are in the middle of a of a transformational period This is not a normal period and climate change is not not a normal and not an easy topic There are two international Dimension things that are not working very well We have not made success one of them is the UN FCCC negotiation and the other one is Doha round of Trade and the reason for that is that both they are both trade agreements essentially So let's let's not forget that and not not forget that we are trying to negotiate or trying to do in Europe About four or five different things at the same time. So a whole bunch of people are being agitated about back loading Same people talking about structure reform in the ETS Roughly the same bunch of people talking about post 2020 or 2030 climate energy policy and And somewhat different people talking about the 2015 international agreement Timelines are different. The issues are not necessarily different. I didn't relate it But all that in the major in the middle of a major international realignment Was was all the bricks becoming or the basics now becoming a very different economy that we used to have So the fact that we're not reaching conclusion doesn't necessarily that we're stupid or we're not trying but the reality These are this is a very complex and very kind of watershed moment Now what are the interaction because I've been asked to talk about interaction as best as I can and I think that the Interaction there's a number of interaction identified one of them is the interaction of the energy between energy and climate change policy the interaction of the international dimension and International the interaction was competitiveness and leakage and these are the three ones that that I found What was discovered during the in relation to these interactions up to now in the 2020 20 package one of them is the the fact of the lack of flexibility And we you know in the business community and I've been you know part of it until about a year and a half ago had been asking about flexibility and predictability and and that is you know kind of We do you know this is something a new phenomenon because for the longest time with people have been asking to be to have certainty There's no certainty in business. There's there's some you know kind of predictability or have you act But the predictability that's been asked now has become a rigidity and the rigidity is transformed There is especially in the UTS, which is the centerpiece of this whole thing Basically has become so rigid that it cannot respond to market forces the changes are given in the market But the time frames and the mechanism for for for adopting those changes are in the legislative arena and the legislative arena in the US I'm in the EU. I'm being Canadian. It's a little bit much a little bit simpler in Canada Even though we have provinces and so on but this is by factor off By a factor of incomprehensible to me a long time to even begin understand how this thing work so We Essentially we we we needed to understand what the Coordination was between the various pieces what we have we have three targets There has been some sought-being given at the beginning as when when those targets were set as to what the impact would be But nobody really thought to put in place a mechanism How to adapt if there were changes, you know, we have an abysmal way of predicting the future especially the economic future And as such we predicted in 2008 What the economic future is going to be it up to 2020 and established targets based on that and no mechanisms to adapt to that That is a little bit rich. Frankly. I mean not surprising that it doesn't work So if you want to have either you have one target Which is the greenhouse gases because this is you know, you want to have an environmental target or you have three targets Because you have other objectives But the other objective I really have to be explained and specified very very clearly if you have three targets You have to have coordination between these three have to have it Especially if you want this to be technology neutral now if you don't want it to be technology neutral You have you want to do certain things then I mean let's kill something and that's not for ourselves It costs money to run an emission trading system It counts money to have people running and trade, you know We built the last ten years we built trade desk and expertise and by the way every day I see friends of mine that have been driven out of this greenhouse gas market because there's nothing to do Are these guys gonna come back is the same talent gonna come back the answer is no so unless we pre provide a Flexibility in this market. I think we need to this is not gonna work. The second thing is the flexibility to responding to The Variation in what we predict and in renewable friends that we expect the renewable have certain impact But the impact on on the carbon reduction has been much much larger How do we adapt to this so we have a piece of adapting to what the economic condition is and it needs to be some Flexibility mechanism is in there, but at the same time we will have a predict a Forecast of what the impact of renewables is gonna be on carbon David has just had all these very nice graphs explaining What happens? But if you don't have something that kind of looks okay We predicted so much but actually there's so so much more and as such we got to take stuff of the market because otherwise You shadow the price of carbon and carbon becomes irrelevant It's not only becomes irrelevant, but it's a loose loose proposition because it's irrelevant by you pay for it Because it is in the cost of electricity, but you it has no impact. So it's wide. Why do we do this? It's you know, I remember I frankly I remember talking to Stefan Dion who was the minister President of Copping Canada and basically Stefan said to me miss your mark cool Which is you know incomparable French accent it look this ambition trading system in our industry doesn't support it You don't support it. Why should I do it? I'm a politician So if it has no pride if it has no impact on reduction has no impact on reduction But it cost the Greeks and the and and the Spanish at 27% unemployment Why do it unless you can actually make it the instrument that is effective and drive something and yes We do understand that it drives certain elements of the economy doesn't drive the basic R&D It does not be drive the basic R&D drives Implementation, but so do feeding tariffs feeding tariffs do not drive R&D for feeding tariffs drive implementation so it's a competing instrument and Finally the there is an interaction the international dimension and that interaction also has to be taken into account Because we have done better than we thought and we have catalyzed all the Bolivians and the Peruvians and the South Africans to produce stuff and Now we find the situation so you guys are too good at this you're producing too much too many credits Including your own young people here in Ireland at the electricity supply board But we don't want it It's really creating a serious problem and unless we manage to have a mechanism to deal with this gonna be a problem The other thing that I think is learn is this this job thing this green job things that you know my own steps organization I have a whole bunch of people having grant and doing research and it is great But the fact that the matter is what yes, we catalyze green jobs. Yes, we catalyze all this wind energy But it's not it's not here. It's all in China We did the research we we produced everything and then the Chinese are Producing it at prices that we cannot compete with and then we're installing it here So if we are to have this as a target for green job, this has got to be thought around as to what else needs to be done In order for it to have this job being retained in Europe or else We gonna we're gonna subsidize somebody else's research and and and so on because what's the basic research is done and many of these things It's not necessarily very complicated. I don't know much. I've never made a turbine in my life But I understand it's not that complex to make a turbine. Is it bang bang, okay? In terms of infrastructure the same the next thing is infrastructure really we have implemented all these Renewables, which is great But we cannot get them out of Spain and we cannot them get it off the north of the Germany because the infrastructure is not there And unless we do this there's no point in doing I'm an electrician and I don't understand too many things understand two things one of them is football and at Barcelona loss Which hurt me the other one is in I understand the electricity because we had the same problem in Ontario and In Quebec we had a lot of generation up north hydroelectric and we had no ways to get them down there same situation here Not very different and finally last but not least and Right now. I do not believe with all due respect to my friends in industry that leakage is a problem At three years the tone it cannot be a problem I can tell you that at $15 a ton in Canada the price the impact on the price of barrels 25 cents So if that is the case, I'm not sure what your calculations are, but that's what I'm being told So at three years a ton is not but if you really are to drive this and you have 25 30 35 Years a ton then it becomes a problem becomes a problem twice that is not being addressed quite well One of them is an internal problem because the way it's treated right now is only certain bunch of certain member states Then can do the subsidy because they have the money But most most people don't the Italians in the Greeks and the Spanish can't do it But the Germans can then you have the real elephant in the room the real elephant in the international dimension Because we're gonna get to two feet 2015 agreement and we linking with Australia and This is going to be a competitive issue because we don't really understand how to do this. I'm happy to collaborate. Thank you very much