Home Essential support Vladimir Putin forced the EU into a long-awaited energy union

Vladimir Putin forced the EU into a long-awaited energy union

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It was clear in 2014, when Vladimir Putin first invaded Ukraine, that Europe should protect itself from being held hostage by foreign energy suppliers. That year, the idea of ​​an “energy union” won rhetorical support from leaders, some of whom continued the hard work to make their energy pipelines more resilient.

Much to their disappointment, Germany made itself more, not less, exposed to Putin by advancing the Nord Stream 2 gas pipeline. inability to secure alternatives, so energy trade does not necessarily mean geopolitical dependence.

One of the oversights has been to allow the expansion of renewable electricity to be partially offset by a decline in nuclear power. Another was not planning enough infrastructure to fully exploit the global liquefied natural gas market. Above all, too little attention was paid to improving the flow of all forms of energy in any direction across Europe, so that no supplier could take over a member country. especially.

The danger that some have warned of is now a clear reality for all. Putin’s weaponization of energy has caused a massive international transfer of wealth from energy-importing countries to exporters such as Russia itself. Politically more perilous is redistribution from consumers to energy producers, even within countries. The fact that electricity is priced at the marginal cost of production has also allowed the Kremlin to drive electricity prices to extreme levels.

Millions of energy users face serious difficulties. This could produce political paralysis, distraction from Ukraine (as Putin clearly hopes) and even civil unrest. European governments are acutely aware of the risks – “three years of these awards, and we have Hitler,” as one official told me.

That is why it is essential that countries agree on a deeper and deeper unified energy policy. There has always been a conflict between the EU’s common energy market — linked, albeit imperfectly, by physical and financial links — and national prerogatives in energy policy. For example, the whole notion of national autonomy over a country’s energy mix becomes inconsistent as electrons cross borders. The desire for national control has delayed the removal of physical bottlenecks in the continent’s energy flows. The price is being paid today in the risk that it will be difficult to get enough energy to the right places in an emergency, even if the overall supply is adequate.

While the efforts of many countries to secure new non-Russian gas supplies have been impressive, they could prove to be unparalleled successes if not accompanied by a much more integrated common policy. The risks of political division are legion: governments are outbidding each other for the same scarce supplies, as German Chancellor Olaf Scholz has pointed out; countries tempted to limit their electricity exports, as proposed by Norway; or differential price support systems that destroy the level playing field in the EU single market.

Such risks should seem realistic as it has only been two years since they last materialized. During the pandemic, countries initially rushed to hoard medical supplies. The various resources allocated to business support schemes threatened to dismantle the single market. But don’t forget either that within months EU countries signed up for the joint purchase of vaccines and a joint recovery fund.

Putin’s invasion of Ukraine is as much a common external shock as the coronavirus. The signs show that Europe remains faithful to the sense of community that prevailed then. The EU has agreed to energy sanctions. Previous plans to green the energy system have been pushed forward and reinforced. New plans to enhance energy security and connectivity and save energy have been developed.

The ideas put forward by the European Commission last week and the encouragement it received from energy ministers on Friday are a welcome final step. Brussels rightly wants governments to capture windfall profits for the most targeted support possible while letting markets work, and to retain incentives for greater efficiency. In contrast, the UK’s choice is to cap prices for everyone. Above all, EU policies show an understanding that if everyone tries to solve their energy crisis on their own, they won’t solve it at all.

Benjamin Franklin’s warning that we will “hang together or hang apart” applies to Europe today. If EU leaders can stick together through a tough winter, they will finally build the energy union they need. And if the UK knows what is in its interest, it will join the effort.

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