EU aims to reduce dependence on Russian gas by 80% this year

The European Union’s executive arm is charting a path to end the bloc’s reliance on Russian gas, which could cut import needs by almost 80% this year, according to two officials with knowledge of the matter.

The European Commission is reviewing its energy strategy following President Vladimir Putin’s invasion of Ukraine in an effort to reduce the Kremlin’s influence.

The plan, to be presented on Tuesday, will propose measures such as harnessing new gas supplies and increasing energy efficiency this year, one of the officials said, and aims to achieve independence from the world’s largest fossil fuel supplier. region well before 2030, earlier than previous projections.

For the plan to have any chance of success, it will need action from Member States, many of which were already uncomfortable with the investment required for the Commission’s energy transition plans and are now struggling to contain the political impact of rising energy costs.

In the weeks before the war, gas shortages pushed energy costs to record levels, pushing the issue high on the EU agenda. European governments have already spent tens of billions of euros to shield consumers and industries from the impact of the crisis, and prices rose again on Monday.

The Commission considers that the EU already has enough gas to see it through the rest of the winter, even if Russian supplies are abruptly cut off. The bloc’s executive arm will recommend member states to start filling storage tanks to be prepared for next winter.

The Commission is prepared to affirm that the acceleration of the “Green Deal”, the bloc’s broad strategy aimed at achieving climate neutrality by 2050, will reduce greenhouse gas emissions, decrease dependence on imported fossil fuels and protect the economy from price increases, according to the official, who asked not be identified, as discussions about strategy are private. Proposals can still change before they are adopted.

As part of clean change, the EU is currently debating a set of laws to meet the stricter 2030 target of reducing greenhouse gases by at least 55% from 1990 levels. Full implementation of the rules”fit for 55″ would reduce the EU’s gas consumption in this decade by 23%, which is equivalent to 82,000 million cubic meters.

Plans to be unveiled Tuesday would add increased LNG imports and pipeline supplies from outside Russia, more renewable gases, energy savings and a shift to electrification. All this will allow the EU to replace the 155,000 million cubic meters of gas that it currently imports from Russia by 112,000 million this year.

Up to 50 billion cubic meters a year will come from new LNG sources, 10 billion cubic meters will come through pipelines from other suppliers, and 20 billion cubic meters would come from new wind power capacities that will reduce demand for gas-fired power plants. .

The push may mean more ambitious 2030 targets for renewable energy and energy efficiency. The Commission is also going to give priority to the connection of the gas pipelines of the Iberian Peninsula with the rest of Europe and to the connection of Bulgaria and Greece.

Although the EU has joined the US and UK in imposing sweeping sanctions on the Kremlin, the Russian energy sector has so far been largely protected due to concerns about the impact on the European economy. Ministers have talked about following the EU in banning oil imports from Russia, but there is no clear consensus and German Chancellor Olaf Scholz has said Russian supplies for now remain “essentials”.

Disposal of Russian oil and coal may be simpler than gas, as the EU has a wider range of alternative suppliers it can turn to, the official said.

The EU’s executive arm will provide member states with detailed guidance on how to design regulated price measures that protect retail consumers and smaller businesses. It will also announce plans for a temporary framework to support the liquidity of companies affected by the crisis. To finance these measures, Member States could consider imposing temporary taxes on windfall profits of energy companies.

To guarantee the replenishment of the bloc’s depleted gas reserves, the Commission plans to present a proposal before April to require that existing storage facilities in the EU territory be filled to at least 90% of their capacity before October 1 of each year. As summer gas reference prices remain high, the EU will propose to increase the reimbursement level to 100% as an incentive to refill storage.

The Commission will also offer coordination to build the reserves through the joint acquisition of gas.