It creates a Cabinet Government of the new Union:-

The Treaty turns the European Council, the quarterly "summit" meetings of Member State Heads of State or Government, into an institution of the new Union, so that its acts and failures to act will, like all other Union institutions, be subject to legal review by the EU Court of Justice. Legally speaking these summit meetings of the European Council will no longer be "intergovernmental" gatherings of Prime Ministers and Presidents outside supranational European structures. As part of the new EU´s institutional framework, they will instead be constitutionally required to "promote the Union's values, advance its objectives, serve its interests" and "ensure the consistency, effectiveness and continuity of its policies and actions." (Art. 9 amended TEU).  

They will also "define the general political direction and priorities thereof" (Art.9b).

The European Council thus becomes in effect the Cabinet Government of the new Federal EU, and its individual members will be primarily obliged to represent the Union to their Member States rather than their Member States to the Union.