BEWARE OF WHITE ELEPHANTS
White elephants are not an endangered species. They are positively thriving and the EU needs to be careful its Energy Union plans aren’t trampled by them.
Europe is not being plagued by rampaging albino pachyderms. At least, not yet.
A “white elephant” is something that cost a lot of money and isn’t really used. Brussels lore speaks of EU-funded empty airports and roads that no one drives on.
Energy Union aims to cut the bloc’s huge dependence on imports by interconnecting member states and boosting the number of suppliers.
This requires infrastructure investment both between EU countries and also, for example, in facilities capable of taking liquefied natural gas from further afield.
Natural gas, a less polluting fossil fuel than coal, has been identified by the European Commission as a “bridge fuel”.
Cutting carbon emissions is vital if the EU is to meet its UN climate change commitments but officials don’t believe that the renewables market is yet developed enough to step up to the plate alone.
Renewables are only going to get better and the EU is legislating to increase their share by 2030. As renewables grow and the EU hits its energy efficiency targets, gas demand will drop.
The Commission estimates energy efficiency measures alone could reduce EU gas imports by 174 Mtoe per year by 2030. That is a lot.
A study by think tank E3G found that EU predictions on potential pipelines assume a 72% higher demand than their projections for when the efficiency goals are hit.
So there is a danger of unnecessary, expensive pipelines, which last 40 to 50 years, becoming stranded assets. On his tour of the EU, Energy Union boss Maros Sefcovic urged member states to think carefully about the risk of such white elephants.
The alternative is worse. Gas infrastructure will continue to be used for decades, despite there being cleaner energy sources available.
The Connecting Europe Facility was set up in 2014 and is the main fund for energy infrastructure investment. Today, the Commission announced a new pledge of €228 million for gas projects.
Total EU financing for gas under CEF now stands at more than a €1 billion. According to Friends of the Earth Europe, this unnecessary subsidy will lock Europe into climate chaos.
Sefcovic has said that the European Investment Bank, a CEF partner, takes the risk of stranded assets into its decisions to open the public purse.
The bloc is hoping to cut its carbon emissions by 80-95% by 2050. It will struggle to do that if it pays for a herd of white elephants.
Euro Commissioner Valdis Dombrovskis said he is confident Greece will meet its deficit targets in an interview with Euractiv.com. He also warned the US against deregulating the banking sector.
EPP vice-president Jacek Saryusz-Wolski told Euractiv Poland that Donald Trump will force change but he does not herald the end of the world. If US defence hawks get their way over Russia’s rumoured nuclear missile deployments, the end may be nearer than he thinks.
Jean-Claude Juncker has urged NATO countries not to bow to military spending demands, advocating a broader interpretation of “stability spending”.
He also believes the UK is headed for the cliff-edge. The Commission chief said it will take longer than two years to negotiate Brexit and the UK’s future relationship with the EU. Theresa May disagrees. Tony Blair has urged pro-EU Brits to “rise up” against Brexit.
The European Ombudsman has ticked off the EU’s foreign affairs services for not paying its interns.
Half of French voters still haven’t made up their minds who to support in the first round of the election in April. Fillon’s loss has largely been Macron’s gain.
MEPs today backed measures to stop EU citizens becoming foreign fighters for terrorist groups, making it more difficult to travel on stolen or falsified documents.
Food companies serve up worse quality food in the East than in the West. East of Austria, regulators found the same products are made with cheaper ingredients.
Bucharest has repealed its controversial graft decree after the Romanian people took to the streets to swallow it. The Commission said this was a “very good step”.
Oh Angela, not you too…
Samuel White contributed to this Brief
Look out for…
US Vice President Mike Pence. He is in Brussels on Monday and will meet Juncker and Tusk. And, very likely, some angry protestors as well.
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