With those inspirational words, Goran Persson, the Prime Minister of Sweden, summed up the release of the new Energy Policy for Europe (EPE) that emerged from the Spring economic summit in Brussels last week. It’s appearance won’t come as a surprise to anyone – Energy has ruthlessly hijacked the EU agenda since the Ukrainian gas crisis in early January and the release of the Commission Green Paper at the beginning of the month signalled that a Common Energy Policy was on the immediate horizon.
So what does it mean? Well Prime Minister Persson’s summary seems to encapsulate the complexity of the energy issue and also hint towards the dangers inherent in the European response. The Green Paper was an ambitious document and recommended three EU objectives in the field of energy strategy: Sustainability, Competitiveness and Security of Supply. It covered environmental issues, the importance of a new energy mix and the questions of sovereignty that this created, the need to complete the internal gas and electricity markets, issues of solidarity in times of energy crisis, the relationship between energy policy and the Lisbon agenda and external relations in terms of energy supply.
The news emerging from the Brussels summit seems a little woollier. Polish plans for a NATO-style energy alliance have been rejected although solidarity in times of crisis remains one of the facets of the EPE blueprint. One of the issues that was anticipated to spark controversy; the question of market competition and national protectionism, appears to have been quietly ignored in spite of (or in fact; because of) the Italy-France dispute over the ENEL/Suez takeover bid and the Germany-Spain dispute over the latter’s derailing of E.ON’s bid to purchase Endessa. The question of nuclear power – which Britain, Finland and France all back but which only has 12% public support within Europe – is not on the table. The subject of energy mix has been answered by a resounding and entirely correct statement that, in the words of Angela Merkel, “the source of energy mix is a national competence”.
Energy security – perhaps the most important issues under discussion – appears to have been dealt with by some fuzzy generalisations about third countries energy policies. Energy consumption remains on the rise and EU imports of oil and gas are set to rise from 50% to 70% by 2030 on current trends. Britain, despite being one of the global top 10 producers of oil and gas, will be a net oil importer by 2010. 25% of EU oil and gas comes from Russia, 31% of oil and 14% of gas comes from Middle-Eastern and African countries. In terms of foreign policy Europe will inevitably have to face up to the threats to supply posed by instability within these regions, particularly in Iraq, Chechnya and the South Caucasus. Russia-EU relations are critical to future energy supply and the current breakdown in relations between the two over the Ukrainian decision to block black market goods from Transniestria in Moldova shows how fragile these relations are. The longer the frozen conflicts, as they are known, continue, the greater the danger to European lines of supply in the Caspian. Similarly Iran ships 50% of the world’s oil across the straights of Hormuz and has threatened to turn off the taps should UN sanctions be enforced over its current nuclear power dispute.
In the face of these problems what has emerged in the EPE last week is not a concrete plan or step forward. Instead by all accounts it seems to be somewhat of a placebo and the concern is now that energy will slip off its position of prominence because unfounded confidence is being placed in the generalisations and broad statements of this blueprint. Energy targets have been set, which considering how successful EU nations have proved in the past at hitting self-imposed targets (national deficits anyone?!) isn’t really a boost to confidence. Thorny issues have been swept under the carpet because of the counter-productive and almost pathological need for European countries to achieve consensus. Foreign policy, as ever, is left in the dangerously slippery hands of a Union that lacks either a mandate or a mechanism to effectively prosecute it and that seems unwilling to confront countries, like Russia, that prove difficult.
It wasn’t something new that was established in Brussels last week, it was in fact just the same style of European leadership – regulation replacing innovation; targets lacking frameworks to put them into reality and foreign policy “action plans” that are not backed up with actual foreign policy – that we have seen on countless other issues in the past. Only now we do not have the time needed for Europe’s ponderous bureaucracy to mince around the issue. The longer we leave the creation of solid and practical plans, the more difficult the issue will become. By 2030 global energy consumption will have risen 100% due to the demand from India and China. By 2045 BP predicts that the world will run out of oil. What we do not need now is a placebo – what we need is something new to be established in Europe and for us all to have a clear idea of what it is and where it will lead us.