OPINIONS

Date: 25 July 2022 Author: Benedek Sipocz

What to expect from the upcoming extraordinary EU Council on Energy of 2022?

Jozef Sikela, the Czech Minister of Industry and Trade has called for an extraordinary EU Council on Energy to be held on the 26th of July 2022. The goal of the summit is to discuss gas deliveries to the European Union, as well as possible solidarity mechanisms amongst member states to cope with the reduced gas supplies.

SOURCE: Wikimedia Commons

The meeting in the Council follows months of disruptions in the gas supplies to the bloc.The EU is working to reduce dependence on Russian fossil fuels on the basis of three initiatives;  The REPowerEU; modification of gas storages; and a new gas supply deal with Azerbaijan signed on July 18 2022. On July 20th, the European Commission presented the ‘Save gas for a safe winter’ emergency package. The package hopes to further decrease reliance from Russia to get through the winter season. The plan proposes to cut the use of gas in Europe by 15% until next spring. As such, gas storage facilities could be filled to the recommended level of 80% and minimize the economic impact of gas shortages.

The proposal was presented a day before the scheduled resumption of gas flow through Nord Stream 1, which has now been resumed after being shut down for 10 days due to maintenance. During this period, worries proliferated that gasflow would not resume once the work was completed. The plan establishes the reduction of gas use on a voluntary basis, meaning it is up to each member state to decide on such measures. However, in the event of a significant danger of gas scarcity, the Commission would be able to issue an EU-wide alert and make the reduction binding. To date, 12 countries from the EU have experienced a total or partial reduction of gas supplies, raising fears about the ability to fill gas storages for the winter. For example, the Vice President of the European Commission Frans Timmermans has stated that a complete reduction of Russian gas would mean that the EU will be unable to fill gas storages to sufficient levels. It is, therefore, in such times that the Commision proposed such plans to be ready for the winter to mitigate any further disruption of the gas flow. The proposal is expected to be discussed in detail and approved at the Energy Council meeting on the 26th of July 2022.

The Commission’s draft emphasizes solidarity among member states to deal with and prepare for coming winters. This means, member states with gas shortages would be able to receive gas from their EU neighbors for primary consumers such as households or vital industries. Such plans have already been drafted as a result of the gas crisis in 2008-2009, however, these have yet to be formalized into concrete actions. The variation in reliance on Russian gas is the reason for such emphasis on solidarity. Reactions to the Commission’s proposal, however, haven’t been unanimous. For example, Spain and Portugal announced they would not support the proposal of the Commission. Another example is the trip made by Foreign Minister of Hungary (Peter Szijjarto) to Moscow – a day after the Commission’s proposal – to negotiate for more gas purchases. All aforementioned examples highlight fragmented energy policies among member states, making it more challenging to cooperate on a European level.

Although consensus on the proposal is lacking on a European level, member states among themselves could sign bilateral solidarity agreements. For example, Germany and Austria have signed such an agreement back in 2021, making it possible for the neighboring countries to help each other.  Whilst a closer energy sharing mechanism on a European scale is far from certain, the extraordinary Council on Energy allows chance to member states to sign such agreements on a bilateral level. The latter would ensure countries heavily dependent on Russian gas to ensure their supply in times of critical shortage from EU sources. This aims effectively at addressing the  fragmented policies visible today across the Union which further enhance energy dependence at the expenses of primary consumers.

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