I represented the UK at the Energy Council in Luxembourg on 10 October.

The council reached political agreement on the Commission's third energy package on the functioning of the internal energy market. There were discussions of the climate and energy legislative package and energy security. The council agreed conclusions on energy efficiency.

Discussions on the internal energy market were based on compromise presidency texts and focused on a level playing field clause, put forward by a number of member states as a way of allowing Governments who have secured ownership unbundling in their domestic markets to control takeovers by vertically integrated companies. The final presidency compromise text met their concerns and political agreement was reached on this basis. This will allow the council to prepare a common position, which will form the basis of negotiation with the European Parliament.

There was a wide-ranging debate on the 2020 climate and energy package. The presidency argued that in the current financial crisis it was even more important for the EU to maintain political leadership on climate issues and urged member states not to lose momentum on progress. The Commission and presidency both considered that it was possible to reach agreement on the package by the end of the year.

In the debate, member states addressed a number of issues (interim targets, the inclusion of aviation, the transport target and sustainability, a review clause and renewable projects of European interest) set out in questions issued by the presidency to steer the debate. The presidency concluded that, despite concerns about the financial crisis, there was a common desire to move forward and discussion with the European Parliament should continue.

The council agreed conclusions on energy efficiency, relating to the implementation of the energy labelling and eco-design for energy-using products directive.

There were a number of information items, including a presidency report on the solar plan for the Mediterranean.

Discussion of energy security was taken over lunch in closed session.