Russia to cut gas supplies again: can the EU get back to growth without a solid energy market?

Mr Borissov seems too certain that Bulgaria will play a primordial role in EU's energy plans. Boyko Borissov, Bulgarian Prime Minister, paid a visit to the EC and was received by Corina Creţu, Member of the EC in charge of Regional Policy, Maroš Šefčovič, Vice-President of the EC in charge of Energy Union, Miguel Arias Cañete, Member of the EC in charge of Climate Action and Energy, and Kristalina Georgieva, Vice-President of the EC in charge of Budget and Human Resources (EC Audiovisual Services, 12/01/2015 )

Mr Borissov seems too certain that Bulgaria will play a primordial role in EU’s energy plans.
Boyko Borissov, Bulgarian Prime Minister, paid a visit to the EC and was received by Corina Creţu, Member of the EC in charge of Regional Policy, Maroš Šefčovič, Vice-President of the EC in charge of Energy Union, Miguel Arias Cañete, Member of the EC in charge of Climate Action and Energy, and Kristalina Georgieva, Vice-President of the EC in charge of Budget and Human Resources (EC Audiovisual Services, 12/01/2015 )

“Energy” is a word that may sound a bit alarming in the European Union nowadays. This happens because Europe has a problem: its energy supplies are not secure. The EU’s prospects of remaining a strong, independent economic and political player in the international arena will largely depend on whether the bloc will be able to secure its supplies at the most convenient economic cost. And this is a hot topic in Brussels at the moment.

Last week saw Russia planning to shift all its natural gas flows crossing Ukraine to a route via Turkey, with a consequent cut-off of six European countries. “The decision has been made”, Russian Energy Minister Alexander Novak stated, leaving the entire EU with big, cold surprise. “The Turkish Stream is the only route along which 63 billion cubic metres of Russian gas can be supplied, which at present transit Ukraine”, Gazprom chief executive Alexei Miller said.

“There are no other options”, he added, also reminding that the EU has to link up to Russia’s planned energy pipeline to Turkey or lose the gas, after the South Stream project has been dropped. “Our European partners have been informed of this and now their task is to create the necessary gas transport infrastructure from the Greek and Turkish border,” said Mr. Miller, according to a Gazprom statement.

The umpteenth overturn in the big Russia-EU relations story happened recently, we could say, but with space for a new element: Bulgaria. Sofia’s government wants to have Bulgaria serving as an important energy bridge for the EU, and to fill the gap left by the cancelled South Stream project. That’s what Bulgarian Foreign Minister Daniel Mitov said last week during a press conference in Sofia, after a meeting with US Secretary of State Mr. John Kerry. “Our common goal is to attract investments to guarantee supply and distribution, as well as to build interconnectivity with neighboring countries,” he stated last Thursday.

From his side, Mr. Kerry promised to help Bulgaria reduce energy dependence on Russia, as well as announcing plans to send the top US energy officials to protect Sofia’s energy security. The American efforts to strengthen ties with Sofia is another unmistakable sign of Bulgaria’s importance at this very moment. Bulgaria is hoping to have its proposal to create a gas hub at the Black Sea coast among the top priorities in the European agenda for this New Year. Sofia knows that this moment could be crucial for developing a new image on the international political stage and its politicians don’t want to lose momentum.

Just a few days ago, on Sunday, Deputy PM for EU Funds and Economic Policy Tomislav Donchev announced that a summit-level meeting of all EU energy ministers will be held in Bulgaria in three weeks’ time. Mr. Donchev told the Bulgarian National Television the event could produce decisions on the “new energy projects” to be carried out in the bloc. He also added that the importance of Bulgaria had “grown a lot” in the current situation, openly referring to the challenges related to the Russian “Turkish Stream” project and the EU-Russia question. Which is still far to be solved.

But the challenges for the EU on the way to a much more secure energy market are not limited to Russia. Also because Bulgaria can build bridges and soften tension, but will never be a final answer to many huge question marks. As such, there’s the EU national governments’s question, with their state-owned companies and Europe’s Energy jeopardized market. How can the EU overcome one of its biggest issues?

“Energy Union”: here is the concept that might give an entirely different sound to the word “energy” alone. Creating a real single market might be the only way to have a stronger position around any negotiation table. An exclusive revelation by Reuters, last week, made this topic even more prominent these days. In a policy paper seen by the international news agency, Germany openly backs a single European energy market, setting itself at odds with Britain at the same time.

Germany’s position paper is being circulated in Brussels by diplomats who asked Reuters not to be named and it reports Germany saying Europe’s energy union needs to be bolstered by EU laws binding on each nation. The paper seems to highlight the word “laws”, which allegedly puts Germany in a position which opposed to the stance of Britain, which has called in general for a “light-touch and non-legislative” approach. “It would not satisfy the implementation of the 2030 council conclusions, if the new energy union governance was merely a soft law process,” the paper says, according to Reuters.

That refers to the 2030 Climate and Energy Package and to the plans for targets on renewable energy and energy savings. As mentioned above, the EU’s will of remaining an influent and – most of all – independent player in the world will depend on energy security to be obtained at the lowest economic, but also environmental cost.

But whether the question was about making convenient moves for finances or for the planet, it is still part of the same big matter: energy.

Energy union can be the key for Europe to give a strong and credible reply to many questions and to raise its voice in order to tell the world it won’t simply stand and stare.

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