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Europe bids to shake off foreign energy dependency

by Staff Writers
Brussels (AFP) Feb 4, 2011
European leaders will on Friday endorse far-reaching moves to reduce dependency on Middle East oil and Russian gas, anchored in a significant new role for nuclear power generation.

At a summit, shaken by instability over Egypt's popular revolt and the soaring oil price, European Union moves to reclaim control over energy supply for the rest of the century are designed to unlock a trillion euros of private investment.

The EU is the world's largest regional energy market -- 500 million people and 20 million companies.

Governments will commit to a broad sweep of market reforms, linking national and regional electricity grids and gas pipelines by 2014 to allow power to circulate freely and cheaply from those who produce it and have surpluses, to those who don't and need it.

"No EU member state should remain isolated from the European gas and electricity networks after 2015 or see its energy security jeopardised by lack of the appropriate connections," reads summit conclusions ready for endorsement in morning talks.

Island states Cyprus and Malta, as well as Baltic countries whose infrastructure remains tied to the former Soviet Union, have expressed fears that their needs may be considered too insignificant for the big energy players to invest in costly transmission networks.

Here, the EU acknowledges that pooled public money may be required to underpin completion of this so-called 'supergrid' -- although ballpark sums will not now be produced until the summer.

Initial European Commission estimates that some 2.5 billion euros ($3.4 billion) could be diverted from unspent EU budgets may be rejected, on the grounds that unspent monies at a time of deep austerity cuts should be returned to national contributors.

One EU diplomat said it was "doubtful" that Britain would back such an approach.

Nevertheless, Prime Minister David Cameron is comfortable with allowing "some limited public finance to leverage private funding," as the summit conclusions specify, provided it comes from cuts elsewhere in the EU budget, he said.

The network development cost over the remainder of the decade is tipped to exceed 200 billion euros.

The other big change, at the instigation of France but firmly backed by the government in London, is to re-position domestically-produced nuclear energy at the heart of the bloc's long-term suppplies.

In a carefully-worded shift in emphasis, alongside investment in renewable energy technologies, EU states will also promote "safe and sustainable low-carbon technologies" under climate action goals.

This has not gone un-noticed among ecologists, and was attacked by Poul Nyrup Rasmussen, the head of the Party of European Socialists, as: "Old leaders, with old ideas, simply proposing old energy methods for Europe's future."

Brussels-based NGO Energy Strategy Center also sees a missed opportunity given a "significant shift currently underway in the climate and energy debate," pointing out that, yet again, "China is rapidly becoming a global leader in the technologies of a resource efficient, low-carbon economy."

France is adamant it is not trying surreptitiously to re-classify nuclear alongside wind, wave, solar or biomass energy production as Europe tries to meet three-pronged commitments to combat global warming by 2020.

These are to reduce carbon dioxide emissions by 20 percent compared to 1990 levels, to raise renewables production to 20 percent of consumption and to make energy efficiency savings of 20 percent.

However, nothing is set in stone thereafter -- and the political mood now, amid greater questioning of scientific evidence, is for a more substantial use of the nuclear alternative.

"Nuclear is not a renewable source," said a senior official under commission head Jose Manuel Barroso of post-2050 guidelines, but "the make-up of national energy mixes is a matter of national choice."

The volume of gas used to generate electricity requirements in the EU has trebled over the past 15 years, with some three quarters of all gas imported into the bloc between now and 2020 coming from Russia, Algeria and non-EU Norway -- ensuring a close link to the price of oil.

To that end, the EU must also develop "a reliable, transparent and rules-based partnership with Russia," leaders conclude.



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