EU and Russia plan to interconnect electricity grids

The EU-Russia Energy Dialogue was taken a step further at two roundtable discussions on 16-17 October in Moscow.

In the framework of the EU-Russia Energy Dialogue, two bilateral round tables were held in Moscow on 16 and 17 October.

The discussion on 16 October was devoted to electricity, and specifically to the issues surrounding the development of a wider European electricity market based upon a future interconnection between the continental European electricity grid and that of Russia and the Sommonwealth of Independent States (CIS). Both parties recognised the interconnection of the electricity systems of the EU & Russia and the establishment of a common European electricity market as a priority for their energy policies. However, number of economic and technical obstacles still need to be overcome, and a first study into the ways in which the grids can be interconnected should be completed by 2007.

On 17 October, the discussion was based on the recently approved Russian energy strategy to 2020, the Commission’s paper on ‘European Energy and Transport Trends to 2030’ and the Commission’s Green Paper on Security of Supply.

The discussion highlighted the growing mutual interdependency between the EU and Russia as well as both parties’ interest in defining common objectives of secure energy supply and demand. The participants agreed to cooperate closely to promote the convergence of energy strategies, industrial cooperation, the facilitation of investment plus the harmonisation of technical norms and standards to create an open continent-wide energy market.

The EU also held informal talks with Russia on its long-sought aim to have Russian oil exports priced in euros, but Russian Prime Minister Mikhail Kasyanov said it was up to exporters to decide if they should stick to the dollar or price oil in euros. “This topic cannot even be discussed. There can be no administrative decisions here. The market decides,” Kasyanov was quoted.

UCTE, the Union for the Co-ordination of Transmission of Electricity, reiterates its support to the development of interconnection as a platform for market developments. UCTE reports further steps towards an in-depth feasibility study together with CIS/Baltic States. During the EU-Russia round table meeting, the group of high level representatives underlined that the focus of investigations must be the reliability of existing systems.

Eurelectric, the Union of the Electricity Industry, confirmed its support for electricity market expansion and integration, and expressed its clear agreement on the technical interconnection conditions and on the market and environmental framework. "If we fail [to establish a common market] we risk creating chaos" stressed Paul Buteel, Eurelectric's Secretary-General.

Russia and the EU are highly interdependent in the field of energy with over 50 per cent of Russian oil and gas exports going to European countries, accounting for over 15 per cent of the EU's total consumption.

Both the EU and Russia are currently defining the main orientations their energy policies for the next 20 years. It its Green Paper on Security of Energy Supply, the Commission emphasised that the energy partnership with Russia will need to represent a major priority.

In October 2000, an EU-Russia Energy Dialogue was launched to discuss issues such as co-operation in energy savings, rationalisation of production and transport infrastructure, European investment opportunities and relations between producer and consumer countries. The Energy Dialogue covers oil, gas, electricity, coal, nuclear power and energy efficiency.

 

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