Commission admission: energy independence has a price

  
Plateforme pétrolière en mer Baltique, 2008. [Andrew/Flickr]
Oil platform. North Sea, 2008. [Andrew/Flickr]

One year after EU leaders adopted measures aimed at bringing down energy prices, the European Commission tabled another blueprint aimed at reducing energy dependence on Russia. But Commission experts admitted that reducing energy dependence would further raise prices.

At the special summit dedicated to energy issues on 22 May 2013, EU leaders adopted measures to lower energy prices, and so improve the  European Union’s industrial competitiveness [read more].

But this time, the Union’s political priority being the high degree of dependence of many member states on Russian energy imports, the European Commission tabled today (28 May) another blueprint, as a basis for discussion for the 26-27 June EU summit.

Presenting the paper, Energy Commissioner Günther Oettinger said that the European Union wanted strong and stable partnerships with important suppliers such as Russia, but that it must avoid “falling victim to political and commercial blackmail”.

The EU and its member states have a lot of homework to do, Oettinger said. He argued that the Union needed to reinforce its solidarity with its more vulnerable members. Charts reveal that Latvia, Lithuania, Estonia, Finland are 100% dependent on Russian gas imports.

He also said that the EU needed to complete the internal energy market, improve the energy infrastructure, become more energy efficient, and better at exploiting its own energy resources. Moreover, the Union needs to accelerate the diversification of external energy suppliers, especially for gas, he said.

The Commission made available a 14-page document titled “In-depth study of European energy security”, which in fact is a collection of familiar facts, illustrating the European Union’s vulnerability, in terms of energy dependence.

As it was already known, the document shows vulnerabilities not only in terms of dependence on Russian gas supplies, but also in the nuclear sector, and in terms of oil refineries [read more].

But the document offers little guidance as to how to overcome these weaknesses. Asked to comment on how the envisaged measures, such as interconnectors, increased storage capacities or alternative supplies would impact energy prices, the European Commission recognised that it could only raise the price of energy.

Stress tests

The main novelty appears to be to ensure uninterrupted supplies this winter. The Commission document proposes “stress tests” to be conducted on regional or EU level by simulating a disruption of the gas supply.

The aim is to check how the energy system can cope with security of supply risks, and based on that, develop emergency plans and create back-up mechanisms. Such mechanisms could include increasing gas stocks, decreasing gas demand via fuel-switching (in particular for heating), developing emergency infrastructure like, for example, completing reverse flow possibilities, and pooling parts of existing energy security stocks.

Positions: 

Susanna Williams, Policy Officer on Energy and Climate Change of the European Environmental Bureau (EEB), an NGO, reacted: “Europe’s number one priority should be to exploit our abundant indigenous resources of energy savings and renewable energy. This is the only truly sustainable solution which does not rely on costly and unsustainable alternatives such as diversification of gas supply routes or the development of shale gas.”

Justin Wilkes, deputy chief executive officer of the European Wind Energy Association, said: "The report from the Commission does not outline how Europe can reduce its energy dependence on external sources; instead it focuses on severing the reliance on Russia by shifting the dependence elsewhere."

Wilkes added: "In the first half of 2014, we have seen Ukraine fall into disarray and an IPCC report warning that investment in renewables is needed to avoid a climate catastrophe. Circumstance has forced Europe's leaders into a rethink. Now they must act to ensure the region's energy security for years to come."

"It is imperative that we make the switch over to renewables, particularly wind, sooner rather than later. Heads of State can start down that road by setting an ambitious 2030 renewables target that strives towards true energy security and independence," he said. 

Timeline: 
  • 26-27 June: EU leaders to discuss how to reduce the Union’s energy dependence
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Comments

Mike Parr's picture

Lowest cost measure: energy efficiency - problem - it takes a bit of time to do. Tell me Guenther - how does the report look on how member states have implemented the EE directive? Oh don't bother I can tell you already (I'm related to Mystic Meg - the well known fortune teller) - the MS have done somewhere between zero and very little - all talk and no trousers.

Since you are leaving soon, I don't see you doing anything about this. It will be for somebody else to pick up the mess. Who knows, perhaps the half -wit the Tory-vermin send to Bx will get the job.

In the case of RES - Wilkes is right - it is the only medium to long term way forward. All reports that come across my desk also show it is by far the cheapest way forward (nuclear? - oh please - don't make me laugh).

In the case of "lower energy prices to improve the EU's industrial competitiveness" this is clearly la la land. I've just done a report on Germany - elec energy prices for industry are comparable with east coast US prices. German elec' wholesale prices have fallen in recent years (they are the same now as 2006 - & I don't mean adjusted for inflation).

Given the output from the "special summit" I can see now why a modest number of EU citizens elected a bunch of dolts & nazis as MEPs - it's to make the other bunch of politicos feel adequate.

Reading the Euractiv article I came away with the overwhelming impression that the EC and the has-been/never-were Commissioners don't have a bloody clue. christ - what an absolute shower.

Gerry's picture

To develop resources you first need investment, there's no getting around that. Renewables are the only option for the future, but people need to let go of their problems with shale gas. If you want to fight pollution, go fight coal, which is going through an absolute boom time, with tar sands right behind, pushing very hard to reach the market.
The most effective way to reduce energy prices is to reduce taxation on them. All fuels are taxed to the eyeballs. Just freezing tax will have a positive effect. Developing a fracking well costs appr seven million in the US, and they had thirty thousand of them in 2012. Just work out how much they spent, it's a sizable amount! You've got to spend first before you can save in this business.

Mike Parr's picture

Well Gerry $210billion buys you quite a lot of reneweables - (+/- 210GW) and they tend to last somewhat longer than a fracked well. So I'd just go for RES and forget about shale gas.

Ecosense's picture

Ha ha ha! More energy, lower prices, all renewable! If it was possible, don't you think people would be doing it already! In fact, it's the "renewables" that are driving energy prices UP. Wind power is intermittent and the sun only shines in the daytime. Know anyone who is willing to have their power go on and off at the vagaries of the wind? Build all the solar panels and wind generators you want, you still need coal fired power generation for a constant, reliable power supply, so you spend billions on "renewables" and have to keep the coal plants running anyway! If you want cheap electricity, STOP spending on wind and solar and build coal. If you want cheap gas, STOP freaking out at "fracking". Get a grip on environmental fear-mongerers, and a grip on reality, before it's too late.

Mike Parr's picture

The only one that lacks a grip on reality is you Eco(non)sense - with your stream of consciousness nonsense.

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