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The EU and Southern Cross: The effects of EU energy policy on EU-Australia energy trade

The Lisbon Treaty which entered into force in 2009 was a major event in the ongoing evolution of the European Union (EU) project. However, despite important changes, energy policy formation remains muddled and continues to be area of contest between the EU and its Member States. This in turn means that trade dynamics with important energy providers such as Australia become affected by the internal dynamics concerning energy policy within the EU. Complicating this further is the advancement of climate change mitigation as a major policy issue also has wide ranging implications.The article argues that despite the Lisbon Treaty providing a legal basis for formulating energy policy through the application of shared competences, it does not exercise any substantive direct influence on national or trade-related issues surrounding energy. Instead of the EU exercising relative control, trade in energy resources is still conducted largely on a bilateral basis with EU Member States continuing to determine the primary aspects of their energy policy. As such, the greatest impact the EU has on Member State-Australia’s energy trade is indirect, through binding policy initiatives originally negotiated by the Member States.