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Energy Union, Russia’s big fear

25 March 2015 15:10 (UTC+04:00)
Energy Union, Russia’s big fear

By Laman Sadigova

The project of the EU-wide “energy union”, presented by Maroš Šefčovič, vice-president of the European commission in charge of energy policy, is the toughest energy policy initiative that will cause a lot of problems for Russian gas supplier, Gazprom.

MEPs opened their plenary in Brussels on 11 March 2015 with this topic.

The Commission says this strategy will give customers more choice, cut down prices and bring down the use of fossil fuels - as well as reduce the continent's reliance on importing energy from outside the bloc.

This means that the EC will independently affect on all agreements on gas supplies, a development which will undoubtedly harm Gazprom’s position in Europe. In fact, nobody in the Commission is trying to hide the fact that the main purpose of the creation of this union is to resist Russia's pressure.

Years of tension between the EU and Russia, that supplies most of Europe’s natural gas, have come to a head with the east-west tussle over Ukraine. The EU is sure that Russia uses its energy sources as a strategy weapon.

Six countries - Bulgaria, Estonia, Finland, Latvia, Lithuania and Slovakia - are dependent on Russia alone for all of their gas imports.

The commission document said in reference to Russia: “The political challenges over the last months have shown that diversification of energy sources, suppliers, and routes is important for ensuring secure and resilient energy supplies. Energy policy is often used as a foreign policy tool, in particular in major energy-producing and transit countries. This reality has to be taken into account.”

The possible consequences for the European gas market and, in particular, Gazprom’s provision on it is comparable only with the adoption in 2009 of the Third Energy Package. However, despite the radical beginning of that project, after negotiations and talks it became possible to soften Brussel’s position. Perhaps, the EU Commission will mitigate regarding this project, too.

It appears clear that Russia is losing ground when it comes to its energy supremacy.

The EC wants to build new strategy in its relationship with Gazprom. Obviously, it will not be profitable for such a giant company. Due to the current economical crisis in Russia, the consequences of this new policy seem oppressive. Gazprom’s huge losses are seen not far off.

The EU leaders also agreed to develop innovative strategies for a new generation of renewable energies and increase energy efficiency.

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Follow Laman Sadigova on Twitter: @s_laman93

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