Prague breaks ranks on EU energy policy towards Russia

Bohuslav Sobotka. Prague, October 2013. [Shutterstock]

While EU leaders make passionate pleas to coordinate national energy policies towards Russia, the Czech Republic said it would not back a Polish proposal to create a single body to buy gas for the European Union.

Prague opposes a Polish proposal to create a single body to buy gas for the European Union, but could support private groups voluntarily joining up for purchases, according to a position document approved by the government on Wednesday (21 May), Reuters reported.

The approved position paper said the Czech Republic did generally “not support the creation of one body in the EU responsible for buying oil and gas”.

Prague’s position comes as European leaders and G7 countries have repeated pledges to cut their dependence on Russian gas, as the Ukraine crisis unfolds.

>> Read: G7 wants to end dependence on Russian gas

The Ukraine crisis has underlined the importance of energy independence for Europe, said European Commission President José Manuel Barroso and Polish Prime Minister Donald Tusk.

Speaking at a conference organised by the Commission in Brussels, Barroso argued that stronger European cooperation was the only way forward to overcome the challenge.

Temporary disruptions of gas supplies in the winters of 2006 and 2009 already provided a wake-up call, Barroso said, referring to the recurrent payment disputes between Russia and Ukraine which led to supply cuts further West. A fresh payment dispute is in fact auguring for a new crisis [read more].

June summit on energy

The 26-27 June EU summit is expected to adopt measures on improving the Union’s energy security. The summit discussions will be based on a Commission paper, parts of which were unveiled by Barroso in his speech.

One of the elements of stronger energy security is reducing energy demand, Barroso said, which is also important under a competitiveness perspective. Next, Europe should increase its own production, wherever possible. Diversifying external gas supplies is another objective, he said, advocating for bringing more liquefied natural gas to Europe and increasing LNG regasification capacities in Europe. Finally, he said member countries needed to step up efforts to strengthen gas interconnections through the Connecting Europe Facility.

The EU should be ready for the next winter by increasing storage, developing reverse flows and the LNG potential, as well as ensuring the security of supply plans at regional and EU levels, Barroso said. He further called for speeding up work on the Southern Gas Corridor – a term referring to pipeline projects to bring gas from Azerbaijan – and for creating a new gas hub in southern Europe. The planned TAP pipeline is expected to bring 10 billion cubic metres of gas per year from Azerbaijan across Greece to Italy, beginning from 2019.

Energy union

Barroso praised the Polish Prime Minister Donald Tusk, who was present at the conference, for having launched the “inspiring idea” of an EU energy union.

According to Tusk, EU energy divisions cost the bloc some €30 billion per year. Poland advocates that a single EU body should negotiate with Russia the price of gas the EU countries import, instead of the present system of secretive bilateral deals.

>> Read: Poland calls for EU energy union

Criticising EU governments’ reluctance to disclose terms of gas contracts agreed with Russia, Tusk asked: “Do gas secrets deserve more protection than banking secrets?”

Meanwhile, the Czech Republic made noises that it would not follow in Poland’s footsteps in the push for establishing a single body to buy gas for the EU.

As EURACTIV Czech republic reported, the official position of the Czech government is as follows:

Prague backs many parts of the Polish proposal, especially when it comes to effective support for infrastructure development, mainly the north-south interconnection, which is a priority for Central Europe. As for the single body to buy gas for the EU, Prague wants to look deeper into the proposal to be sure that it would really bring positive effects.

If the Czech government is sure that there will be positive effects, it will probably back the Polish proposal. The main argument of Prague is that gas is bought by private companies. Common purchasing of gas does not automatically mean that the prices would be lower, according to the Czech State Secretary for European Affairs Tomáš Prouza. Therefore the Czech Republic wants to find such mechanisms which would be “interesting” for those private companies, implying that the companies themselves would be able to negotiate lower prices.

The new Czech government is led by Bohuslav Sobotka, who is also the chairman of the Czech Social Democratic Party (?SSD). The Czech position is likely to push EU leaders to make bold decisions at the 26-27 June EU summit. 

The European Union currently imports 53% of the energy it consumes and is dependent on external suppliers for crude oil (almost 90%), natural gas (66%) and to a lesser extent also solid fuels (42%) as well as nuclear fuel (40%).

Some countries are particularly vulnerable, namely the less integrated and connected regions such as the Baltic and Eastern Europe. Lithuania, Latvia, Estonia, Finland, Slovakia and Bulgaria depend on Russia as single supplier.

  • 26-27 June: EU summit to take decisions to improve the energy security of the Union

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