Raphael J. Heffron - Energy Law: An Introduction

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The Author(s) 2015

Raphael J. Heffron Energy Law: An Introduction SpringerBriefs in Law 10.1007/978-3-319-14191-6_1

1. What Is Energy Law?

Raphael J. Heffron 1, 2

(1)

School of Law and Centre for Integrated Energy Research, University of Leeds, Leeds, UK

(2)

Associate Researcher, Energy Policy Research Group, University of Cambridge, Cambridge, UK

Raphael J. Heffron

Email:

1.1 Introduction: What Is Energy Law?

Energy law concerns the management of energy resources. This is a simple definition, and disguises that it is arguably one of the more complex areas of law. It demands that a scholar in the area engage with other disciplines to some degree, such as politics, economics, geography, environmental sciences and engineering.

In 2015, energy law is still considered a new area of law. It appears not to have the established academic literature base of other legal areas. However, this is to misunderstand what energy law is. It has been in existence in different forms for over a century. In the 1800s and early 1900s, there was legislation to manage energy sectors such as coal and oil. These energy sources are known as fossil fuels (along with gas) and form one of the two main categories of energy sources. The other category is low-carbon energy sources which have been in development since after the Second World War (1945) and consist of nuclear energy, hydropower, wind, solar, biomass and several other minor renewable energy sources.

Energy law has now come to the fore. It is viewed with a holistic approach today whereas before it was divided into many partsin general in terms of each type of energy source. There is a realisation in the twenty-first century of the fundamental role that the energy sector plays in the economy of a country. It is an important sector for employment, future economic development and the personal health of a nations citizens. In particular, it has been pushed high up the political agenda with the advent of climate change and policies concerning energy security. For example, the impacts of Russias ability to affect gas prices in the majority of the European Union (EU) have highlighted the importance of the energy sector at both EU and Member State level. Further, politicians can be credited with pushing the agenda, in part, because high energy pricesmainly electricity priceshave an influence on election outcomes.

It is no surprise therefore that, as a legal speciality, energy law has returned to prominence. The area is now growing at an accelerated pace, with journals, textbooks and practitioner books all appearing in numbers. Commercially, there is widespread growth of energy law divisions in the majority of medium to large legal practices. Legal training in energy law has also increased, with a proliferation of continuing professional development (CPD) summer courses and dedicated Masters courses, and a number of undergraduate law programmes in the EU and US have introduced it as a core and optional subject.

The European Union itself represents an example of the subject status of energy law. The EU was founded upon two treatiesthe European Coal and Steel Community Treaty and the Euratom Treatythat were used to manage the natural resources and energy assets of countries within the initial group of Member States. Indeed, the initial aim was to preventor at least limitthe possibility of future outbreaks of war by having a common management scheme for energy resources and assets. The two treaties that formed the EUwith one of these, the Euratom Treaty, unchanged sinceare one reason why specific energy law did not appear in individual Member States until the last decade.

The next decade will be particularly important for the energy sector globally. The energy infrastructure built and policy concerning future energy infrastructure development during this period will determine whether many countries will meet the climate change targets that they set for the period 20202050 (considering the life-span of new energy infrastructure is generally 25 years plus), and they will set in place the physical and legal frameworks within which energy policy will have to function for many years.

A vital purpose of current energy law is to encourage, incentivise and/or initiate new energy infrastructure. For example, nearly a decade ago the United States enacted the Energy Policy Act 2005. The key aim of this piece of legislation was to initiate several hundred billion dollars worth of new energy infrastructure projects. While initially it was slow in its application, the Act has since 2012 resulted in almost $30 billion of energy projects beginning constructionin particular, the nuclear energy projects in the states of Georgia and South Carolina.

Similarly, the UK government declared that the goal of its Energy Act 2013 was to initiate 110 billion of new energy infrastructure. Across Europe, many countries plan to follow the UK approach to energy law in encouraging investment in energy infrastructure, and as such developments in energy law will be of considerable value and interest to policy-makers, practising lawyers and scholars across Europe. The development of energy infrastructure is seen as not only a method of increasing economic growth through spending, but also a key means of achieving future economic growth through developing energy infrastructure supply chains and exportable expertise and technology in the sector.

1.2 Scope of the Text

This chapter is a general introduction to energy law. It will provide a useful background to energy law for new students and is also accessible to those from other disciplines such as the social sciences, environmental sciences and engineering.

The text is formed of four parts. The first covers what energy law is, and includes an analysis of its key components, the key organisations and the key influences on the subject. The second part provides a background to the three levels of energy law, from international to national to local energy law. The third section of the text delves into more detail and examines energy law in the context of energy policy concepts and the overlap with environmental law. The section concludes with an examination of the law for different energy sources, both fossil fuel and low-carbon energy sources.

The fourth and final part of the chapter engages with the key research focus in the area of energy law, comparative energy law analysis and an introduction to some key case law in the area. The text concludes with a summary of potential future directions of energy law.

1.3 Elements of Energy Law

1.3.1 The Energy Law and Policy Triangle

It is hard to separate the study of energy law from energy policy. In many ways they are intertwined. The main theory in energy law and policy that this text offers can be seen simplistically in Fig.. Here this is referred to as the Energy Law and Policy Triangle and it is also known in other cases as the Energy Trilemma; either name can be used in the literature. However, it is advanced that there is a distinction, as the challenge of balancing the energy law and policy triangle raises the question of the energy trilemma and how does society resolve it.

Fig. 1.1

The energy law and policy triangleThe energy trilemma. Source Constructed by Author (2014)

Energy law and policy is in the centre of the triangle and on the three points of the triangle are economics (finance), politics (energy security) and environment (climate change mitigation). These three issues are each trying to pull energy law and policy in their direction. In essence, effective and efficient energy law and policy will balance these three aims to deliver the best outcome to society. However, if one examines energy law and policy in more detail, often it is just one of these issues that dominates the energy agenda.

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