Rising energy prices and concerns about a Russian invasion of Ukraine are forcing European leaders to reconsider their energy security, particularly their decades-long reliance on Moscow for natural gas.
After years of slow work toward completing an “energy union” — 2015 aim to allow affordable gas and electricity to flow across borders while diversifying providers and meeting climate targets — the crisis highlights Europe’s fragility. Europe still requires natural gas, which it obtains from Russia, as renewables such as solar and wind are gradually built up and coal and other fossil fuels are phased out.
This highlighted the importance to homes and businesses as Europe’s gas supply fell and prices skyrocketed, owing in part to Russia selling less gas than usual, squeezing households and businesses with growing costs.
With gas reserves running short and fears that war could disrupt Russian pipelines, the EU is focusing on importing liquefied natural gas (LNG) by ship from the United States, Qatar, Algeria, and other countries until renewables catch up. Environmentalists believe that making it a short-term priority could jeopardize Europe’s efforts to transition away from fossil fuels.
EU Energy Commissioner Kadri Simson said Monday that doubling down on renewables will help reduce reliance on Russian gas while reiterating the importance of energy security. “It’s crucial that contingency preparations are ready for the worst-case scenario,” she added, as an advisory panel to manage the EU’s gas supply security met Tuesday.
At the Munich Security Conference on Saturday, European Commission President Ursula Von der Leyen said the EU is “on the safe side for this winter,” but is doing “all possible” to “get rid of this dependency.” She accused Gazprom, Russia’s state-owned gas company, of “deliberately attempting to store and distribute as little as possible while prices and demand skyrocket.”
While pressing for German approval of its contentious Nord Stream 2 project as a method to ease Europe’s gas shortage, Russia has honored long-term contracts but failed to sell additional gas on the spot market. Germany has put the process of certifying the pipeline on hold, according to Chancellor Olaf Scholz, after Russia acknowledged the independence of rebel territories in Ukraine, potentially allowing soldiers to enter the country.
According to a given English translation, Russian Energy Minister Nikolai Shulginov remarked Tuesday at a gathering of gas producers in Qatar, “We are aware of the low gas resources in European countries.” Long-term gas contracts, he said, assist to keep prices stable, and Russian energy companies are “completely committed” to completing existing deals.
In the event of a conflict, security analysts believe Russia would be uninterested in a comprehensive gas cutoff, which would cost it money and encourage Europe to seek alternative energy supplies.
Lithuania and Poland, for example, have been able to lessen their reliance on Russian gas imports. However, Russia supplies more than a third of the EU’s energy, and its hegemony is firmly established in the Baltic nations, Germany, Italy, and parts of Southeastern Europe.
The primary problem is that the EU’s 27 member states maintain significant control over energy policy. Even when a network exists, transporting gas from one country’s system to another is challenging due to conflicting regulations and standards. Energy companies transporting gas across borders, for example, maybe charged tariffs many times.
“Unfortunately, energy interconnection in Europe is an unresolved issue,” said Miguel Arias Caete, a former EU energy, and climate commissioner who led a plan for expanded gas infrastructure.
“In times of crisis, we recognize the necessity for market integration and sufficient infrastructure from a security and procurement standpoint,” he said, adding that the focus on renewables should not overshadow natural gas’s role.
Diversifying energy supply to lessen Russian reliance was entrenched in the EU’s 2015 energy unity plan after Russia invaded Ukraine’s Crimea area in 2014. There has been substantial improvement since then: More LNG import terminals are planned, as well as more two-way pipeline connections.
A new pipeline connects Azerbaijan and Western Europe, passing through Turkey and Greece. A pipeline expansion from northeast Greece to southern Bulgaria is also being planned, which would ease Bulgaria’s total reliance on Russian gas. Greece is also going ahead with plans to construct a facility to receive LNG transported by sea.
However, energy policy specialist Simone Tagliapietra, a senior fellow at the Bruegel think tank in Brussels, believes that linking Europe’s energy markets has not been done “sufficiently successfully.” A pipeline connection between Spain and France, in particular, was shelved, leaving “a big congestion that we didn’t manage to fix,” he explained. Now, gas industry groups are debating whether or not to revive the notion.
Following the Crimean conflict, the focus turned from energy security to climate change, paving the way for the EU’s 2019 Green Deal, a broad-based strategy to reduce emissions.
“Energy security has vanished,” said Tagliapietra. “It was all about decarbonization and sustainability.” The problem of energy security is making a big resurgence in Europe right now.”
The issue appears to be more pressing among newer, eastern EU members who have painful memories of Russian dominance during the Cold War.
Poland has been working on pipeline connections with its neighbors, such as the Baltic Pipe, which will begin delivering Norwegian gas to Denmark and other nations in 2023. On the Baltic Sea, close the German border; the government also erected the Swinoujscie LNG port. Since 2015, the facility has assisted in reducing Russian gas imports through the Yamal pipeline by a third, to less than 60% of overall gas imports.
When the Yamal deal expires next year, Polish authorities have pledged not to renew it, instead of relying on more LNG from the United States, Qatar, and Australia.
However, investing billions in more pipelines or import terminals risks making them outdated as the long-term shift to renewables continues, according to Tagliapietra. Instead, he suggested that Europe mandate gas providers start the winter with proper storage levels.
Last summer, Russia’s Gazprom failed to fill its underground storage in Europe. “It’s up to them,” Tagliapietra added, “and that’s not acceptable.”
Governments are also discussing the establishment of a strategic gas reserve, which might be shared among many nations or coordinated at the EU level. Since the 1970s, energy-consuming countries have done so with crude oil.
The solution, according to environmentalists, is not additional gas, but rather action to boost renewables.
“It’s a little odd and startling,” said Elif Gündüzyeli, a Climate Action Network fossil fuels policy campaigner. “Adding additional gas to the system to solve the energy supply problem is similar to adding another lane to a highway to solve a traffic problem: more automobiles come in, and things get even more difficult.”
“I don’t think unhooking from Russia and hooking up with the US will address any of the EU’s energy security challenges,” she said. “And it certainly doesn’t address the pressing issue of climate change.”
