This is “the most ambitious European energy project since the Coal and Steel Community” – Vice President European Commission
Invoking the memory of the organization that led to the foundation of the European Union, Maroš Šefčovič, Vice President of the European Commission, said that creating a single energy market for the E.U. would be the most ambitious project the union has taken on since the Coal and Steel Community. The new ‘Energy Union’ being proposed is planned to give the E.U. more stable energy markets and greater freedom from its reliance on energy markets in Russia.
The E.U. is the largest energy importer in the world, sourcing 53% of its energy at an annual cost of around €400 billion ($448 billion), according to the Energy Union press release. The plan is designed to create a framework in which the E.U. can produce its own energy, greatly reducing its need to import more than half of its energy needs. Another objective of the Energy Union is to establish a more secure energy market within the E.U., reducing the union’s dependency on Russia, which supplies 23% of the E.U.’s gas and is the sole gas supplier for some of the union’s Baltic States.
This concern has become increasingly felt in the E.U. as relations with Russia continue to deteriorate over the situation in Ukraine. Earlier this week, Moscow threatened to cut off gas supplies to Ukraine over a payment dispute, which could adversely affect gas flows to the E.U. and enforce a very real sense of urgency.
The plan includes new legislation to redesign and overhaul the electricity market, ensuring more transparency in gas contracts, substantially developing regional cooperation to develop an integrated market with a regulated framework, new legislation to ensure the supply for electricity and gas, and increased E.U. funding for energy efficiency or a new renewables energy package, among other initiatives.
Efforts to centralize energy policy could be divisive due to the varying energy needs of the E.U. members, reports the Economic Times. For example, Germany is in the process of closing several of its nuclear plants and is dependent on Russia for its gas supply, Poland relies almost entirely on its own coal mines, and Britain is investing heavily in nuclear power and renewables.
The plan is also expected to run into opposition from a number of countries that will resist giving up national sovereignty in the name of creating a shared energy market, says BBC.
The proposals have passed the European Commission, but still need to be approved by member states and the European Parliament. Mr. Šefčovič hopes that the 28 member states will cooperate on the development of a single European energy market, ultimately creating a predictable energy environment that will attract investors and create jobs and growth.
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