Should Europe ban oil and gas imports from Russia? Can European Member States simultaneously prevent climate change, protect Europeans from rising fuel bills, and achieve energy independence from autocratic regimes? In 2021, 40% of the EU’s gas imports and over 25% of crude oil imports came from Russia. Some economists think the impact of an energy embargo against Russia would be catastrophic for Europe. Others argue the impact would be significant but manageable, and point out the morale imperative to stop funding war crimes in Ukraine.
What do our readers think? We had a question put to us by András, during a focus group we ran. He asked: “In your opinion, can the EU’s energy dependency be harmonised with our values and our security priorities? What’s the right direction?”
During a Friends of Europe event on EU carbon pricing, we put András’ comment to Beatriz Yordi, Director for Carbon Markets and Clean Mobility at the European Commission’s Directorate-General for Climate Action (DG CLIMA). What would she say?
Let us recall the Paris Agreement [on Climate Change], which is part of our European values. Solidarity is also part of our European values. Let’s also remember the ETS (Emissions Trading System), last year, apart from providing a market signal, has put into the hands of Member States more than 30 billion euros, and these 30 billion euros have been used for solidarity, for investing in renewable energy and energy efficiency, in modernisation (e.g. of the Hungarian electricity and energy system), so there is this second part of solidarity which is absolutely compatible with the Green Deal and which the Green Deal can accelerate.
Another point is resilience… something I’m proud of is that the 700 billion euro recovery plan for COVID-19 [will be paid] partly from the ETS (Emissions Trading System) and the CBAM (Carbon Border Adjustment Mechanism). So, the solidarity elements are part of our values and I think a harmonised market signal is part of our values.
For another perspective, we also sent András’ question to Tracey D’Afters, host of Friends of Europe’s Frankly Speaking podcast on the War in Ukraine (which you can subscribe to on Soundcloud or Spotify). In episode 8 of the podcast, Tracey put András’ question to Paul Taylor, Senior Fellow at Friends of Europe, former Reuters journalist, contributing editor at Politico and author of Friends of Europe’s newly published report on the Black Sea. How would Paul respond?
András has a good question, because there is one way in which we can harmonise our energy needs with our principles and values, which is by becoming more and more autonomous in our energy supplies. And that’s done by speeding up our transition to renewable energy sources; by making the best use of our own interconnections within Europe to share energy, whether those be pipelines or energy grids or reversible interconnectors between different countries’ energy systems. We’re not making optimal use of that and, for example, France has long blocked an energy pipeline through the Pyrenees, ostensibly on environmental grounds but, one suspects, also to protect the monopoly of EDF, the French electricity provider. And so that makes Iberia a bit of an isolated zone in energy terms.
That’s one thing. But, secondly, in the short- and medium- term, you will have noticed (and I’m sure András is aware) that the disposition of energy fossil fuels around the world – resources of reserves of oil and gas – does not overlap with the map of liberal democracies in the world. So we will have to, in an interim period, buy energy from countries that don’t share our values and political system. That’s unavoidable. We can reduce that by making the efforts I’ve described. However, we can also reduce our dependency on any one of those authoritarian regimes by diversification. That’s already started with the attempt to get Liquified Natural Gas (LNG), but that brings into play countries which are not Jeffersonian democracies: I’m talking about the United Arab Emirates; I’m talking about Qatar; and one or two countries are being brought out of quarantine, such as Venezuela, which has not become more democratic or less corrupt overnight, but because the United States wants to diversify energy supply.
So, in the short- to medium- term, we are going to have to balance our dictatorships against each other in our energy supply. But, in the long-term, we are going to have to tap the sun and other things which are not authoritarian and are not opposed to our values.
Finally, we had another question posed during a focus group we ran, this time by Michael, who asked: “How do you think the Ukraine crisis might make the US and EU reconsider their relationships with Saudi Arabia?”
Tracey posed Michael’s question to Jamie Shea, Senior Fellow at Friends of Europe and former Deputy Assistant Secretary General for Emerging Security Challenges at NATO. What did he think?
Well, I think Paul already broached this very well; The lesser evil sometimes has to be chosen over the greater evil. You’ve seen Boris Johnson go to Riyadh over the last couple of days, President Biden has been trying to phone the Crown Prince – I understand he was rebuffed at first. So, there is a sense of once again going to the Saudis, as we used to do in the past during the great oil shocks of the ’70s, to ask them to ramp up their production. The Saudis have some of the largest, easily-tappable oil reserves. They are able to ramp up production quickly, in a way that many countries can’t because they don’t have the infrastructure or the technology; and, of course, the Saudis have been, in the past, very dependent on Western arms for their security, so we have had effective levers over them.
But, of course, we are in a different situation these days, where sometimes our policies contradict each other. For example, when Joe Biden became President he did something I think admirable, which is he blocked US military sales, in certain categories, to the Saudis because he wanted to put pressure on them to make peace in Yemen, and there was the uproar when the Saudis were implicated in the murder of the journalist Jamal Khashoggi in Istanbul a few years ago. So, we started to get tough on these authoritarians that Paul was speaking about and then suddenly realised we need them after all to help us out of a hole with the energy crisis. So, geopolitics has not gone away, and we are going to have to balance short-term realpolitik with much nobler long-term goals of greening our economies, getting out of fossil fuels, and going into renewables. But it’s not going to be an easy act – for example, environmental lobbies are not at all happy that, in the UK, we are thinking of going back to fracking, the big company Royal Dutch Shell has just reversed a decision when it comes to exploring for oil in the North Sea because the oil price has gone up and it’s now commercially viable.
So, firstly: we’re going to have some short-term fixes, because do we want to see the Yellow Vests all over the streets of Paris, or London, or Berlin protesting about falling living standards in the next couple of months? Clearly not. Second thing: we’re going to have to diversify, as Paul has said. And, thirdly, we’re going to have to keep the environmental lobby rightly happy (and in our own interest) by somehow combining this with pushing ahead with the EU’s Green Deal, all of the plans to move to renewables. It sounds a contradiction, but diplomats are paid to produce coherence out of contradictions.
Finally, how would Paul Taylor respond to Michael?
There’s one other factor which hasn’t been sufficiently put in play so far, which is getting our own populations to reduce their energy use. Both of us are old enough to remember the ’70s oil crisis, when there were countries where you could only drive one day out of two, depending on whether you had an odd or an even licence plate number (some enterprising people managed to have two). There are all sorts of things that we can do – turning the heat down, showering with a friend *laughs* (or at least showering shorter), that can make a difference to our energy consumption. And cutting out the waste of energy – there is still more to be done there and on energy efficiency.
The International Energy Agency (IEA) came up with a very simple to-do list of ten points to reduce our dependency on imported oil and gas. Our leaders ought to be paying much more attention to that, and I think we need to be leading a civil society response of ‘turn the lights off to thwart Putin’.
Can the EU have an ethical energy policy? Should Europe ban oil and gas imports from Russia? Can European Member States simultaneously prevent climate change, protect Europeans from rising fuel bills, and achieve energy independence from autocratic regimes? Let us know your thoughts and comments in the form below and we’ll take them to policymakers and experts for their reactions!