Russia declares gas war on the European Union – POLITICO

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Russian President Vladimir Putin is playing a tricky role with the European Union — cutting off gas shipments to some of Russia’s best customers amid anger over sanctions imposed after the invasion of Ukraine.

It puts enormous political pressure on governments, threatens to leave Europeans in a freeze if the winter turns cold, and potentially undermines climate bloc goals as countries replace gas-fired power with coal. It could even push the continent into recession.

Simon Tagliabitra, Analyst at Bruegel Research Center, calls Russia’s “energy blackmail” policies.

Only 40 percent of the normal amount of gas flows along the Nord Stream pipeline from Russia to Germany under the sea, affecting deliveries to France, Italy and Austria as well as Germany. Russia’s gas export monopoly Gazprom has already halted all deliveries to Poland, Bulgaria, the Netherlands, Finland and Denmark after energy companies in those countries refused to comply with the Kremlin’s demands to pay delivery costs in rubles.

In response, some countries are planning to launch coal-fired power plants.

“It must be recognized that Putin is reducing gas supplies to Europe little by little, and also to raise prices, and we must respond with our measures,” German Economy and Climate Minister Robert Habeck said on TV. an interview late Sunday, adding that “the situation is tense and dangerous.”

Austria plans to shut down its coal-burning power plant again.

Poland aims to subsidize coal used to heat homes.

The Netherlands decided on Monday to scrap previous plans to limit production from four coal-fired power plants.

“If these weren’t special times, we would never, ever”, He said Climate Minister Rob Getten.

The Italian government is planning a crisis meeting on Tuesday, Prime Minister Mario Draghi has ordered two units to reconvert liquefied natural gas into natural gas, and has also talked to countries including Qatar, Angola and Algeria to sign gas supply agreements in a desperate attempt to secure supplies in case this happens. Russian shutdown.

Brussels is eager to show confidence, but the concern is clear.

“We are dealing with a situation in which we are in a very serious situation. We are ready,” European Commission President Ursula von der Leyen said at a meeting with journalists on Monday. “We are in difficult times. She added that times are not getting any easier.

dirty deals

The rush to burn coal to secure an energy supply is an embarrassment for climate-conscious Europeans. But few people expect that it will derail the European Union or its member states in their efforts to reduce greenhouse gas emissions.

In Germany, officials insist that the return of coal will be short-lived and will not jeopardize the country’s path toward decommissioning coal power by 2030. Coal will serve as a back-up supply to the energy sector, allowing the country to build up gas storage before winter. Meanwhile, the government plans to rapidly ramp up clean energy.

Coal-fired Neurat power plant in Germany | Andreas Rentz / Getty Images

Simon Muller, director of the Agora Energiewende think tank, said the Russian invasion has boosted political support for Germany’s renewables.

“This extra layer of urgency that we now have in the face of this situation helps provide the political momentum we need for some very important acceleration in building renewable energy,” Mueller said. Germany’s parliament is considering 10 measures for energy efficiency and renewable energy, and Müller said the three-party coalition was broadly cohesive on the importance of removing barriers to green energy.

The green groups were also optimistic. “There is absolutely no plan in Germany at the moment to put the coal exit date into question,” said Christoph Bales, policy director at the NGO Germanwatch.

But the need for a rapid change in the coal phase-out trajectory is heightening political tensions.

In Berlin, the conservative opposition criticized Habeck for allowing more coal use while ruling out keeping Germany’s three remaining nuclear power plants operating beyond the end of this year.

“I don’t understand that the Green Climate Minister would prefer to allow more coal plants to operate for longer, rather than carbon-neutral nuclear power plants,” said Jens Spahn, Christian Democrats deputy chair in Parliament, Tell German television on Monday. The nuclear shutdown was one of the policies adopted by the former leader of his party, Angela Merkel.

Politics is also causing pressure within the ruling coalition.

“What is necessary is to keep the remaining three nuclear power plants operating for a longer period,” said Bijan Gir Saray, general secretary of the Liberal Democrats. This is a fact that the Minister of Economy cannot simply ignore. “

Admitting the move was “taboo-breaking,” Habeck said, coal was still better than reviving atomic energy, arguing that a change in nuclear policy would only have an impact at the end of next year — too late to help this winter. It was endorsed by Chancellor Olaf Schultz, who said in an interview She posted Monday that “Nuclear isn’t going to help us now, not in the next two years, which is what matters.”

Political leaders are calling on their people to conserve energy and reduce gas use, while governments are working to increase storage levels to allow the continent to weather the Russian winter gas outage. As a last resort, they are considering gas rationing.

An interruption of the gas supply would almost certainly push the mass into recession. European Central Bank warned The eurozone will shrink by 1.7 per cent next year if Russia turns off the tap completely.

“Energy supply disruptions and low prospects for an immediate replacement of gas supplies from Russia are likely to require some rationing and resource reallocation, leading to reduced production in the eurozone, particularly in energy-intensive sectors,” the bank said. Predictably, if that happens, the bloc’s economy will recover next year.

But the European Central Bank also had a word of caution for Putin.

“With regard to the Russian economy, the scenario is characterized by a severe recession with a production contraction similar to the one that occurred when the Soviet Union collapsed.”

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