2:50pm

Fri March 21, 2014
Parallels

Can Europe Wean Itself Off Russian Gas?

Originally published on Fri March 21, 2014 6:22 pm

Many European nations were searching for ways to cut back their reliance on Russian energy long before the crisis in Ukraine flared last month.

In 2006 and 2009, for example, the EU was rattled by the ease with which Moscow cut off gas supplies to Ukraine and other parts of Europe after disputes over cost and supply. The two-week standoff in 2009 left millions in Eastern Europe without heat in the middle of winter.

Russia supplies the European Union with about a third of its natural gas, shipped mostly by pipeline through Ukraine. And according to Kristine Berzina, an energy specialist with the German Marshall Fund in Brussels, Europe needed to find alternative ways to heat homes, fuel industrial production and generate power.

"Europe has been trying to use other fuels to diversify the energy mix. In particular it has increased its use of renewables," Berzina says. "Germany is a great example, where there is a tremendous increase in renewable energy in the past decade."

That includes wind and solar power. Berzina says at the same time, the use of coal has increased in Germany because it has closed down its nuclear power plants.

She says Europe is also diversifying its suppliers of natural gas.

Norway provides the EU with about 30 percent and Qatar supplies about 10 percent in liquified form, or LNG. The Obama administration has begun issuing permits to begin exporting LNG produced in America, but the first shipment won't go out until late 2015. Berzina says it's likely there might be other options in the future for Europe.

"There's always discussion about the potential of the eastern Mediterranean natural gas that is offshore in the waters of Cyprus and Israel. At the same time, there are new developments for natural gas production and liquefaction and export also in East Africa," she says. "So I believe that if we fast-forward to 2018, 2019, we'll have a completely different natural gas landscape and potentially a much more resilient Europe."

The Debate On Shale Gas

The current crisis has renewed talk about developing a shale gas industry on European soil. But Will Pearson, director of global energy and natural resources at the Eurasia Group, says the method of fracking — or hydraulic fracturing — for shale is extremely controversial in Europe.

"France, Bulgaria, many countries have very heavy restrictions or bans on fracking, whereas others, like the U.K. and Poland, are pushing quite hard to develop their resources," Pearson says. "It's a very slow process to get projects approved, and it's very much a nascent industry and very few wells have been drilled."

Europe has taken steps to make sure it's not caught short if Moscow turns off the spigot, says David Goldwyn, who was the U.S. State Department's special envoy in efforts to promote shale gas overseas. He says the EU eliminated a prohibition on the sale of gas, even Russian gas, from one country to another.

"Second, they've done a lot to build gas storage and that would allow Ukraine to make it through the spring and the summer, if need be, if Russia were to cut off their supply of gas," he added. "And they now have a great deal more interconnection than they had five years ago so that you can move gas around the continent. They literally enabled a pipeline system in one country to connect the pipeline system in another."

These three things make it possible to reverse the flow of gas if Russia cuts supplies. Countries such as Germany, which has huge amounts of gas in storage, could pump it back toward Ukraine, reducing Ukraine's dependence on Russia, at least for a while.

Copyright 2014 NPR. To see more, visit http://www.npr.org/.

Transcript

ROBERT SIEGEL, HOST:

European leaders just wrapped up two days of meetings in Brussels to discuss how to respond to Russia's annexation of Crimea. Among the topics, ways to reduce Europe's reliance on Russian oil and gas. Russia supplies the European Union with about one-third of its natural gas, and much of that is shipped by pipeline through Ukraine. As NPR's Jackie Northam reports, alternatives will take time to develop.

JACKIE NORTHAM, BYLINE: Europe has been searching for ways to reduce its energy dependence on Russia long before the crisis in Ukraine flared up late last month. The EU was rattled by the ease with which Moscow cut off gas supplies to Ukraine and other parts of Europe in 2006 and 2009 after disputes over cost and supply. The two-week standoff in 2009 left millions in Eastern Europe without heat in the middle of winter.

Kristine Berzina, an energy specialist with the German Marshall Fund in Brussels, says Europe needed to find alternative ways to heat homes, fuel industrial production and generate power.

KRISTINE BERZINA: So Europe has been trying to use other fuels to diversify the energy mix. In particular it has increased its use of renewables. Germany is a great example, where there is a tremendous increase in renewable energy in the past decade.

NORTHAM: That includes wind and solar power. Berzina says at the same time the use of coal has increased in Germany because it's closed down its nuclear power plants. Berzina says Europe is also diversifying its suppliers of natural gas. Norway provides the EU with about 30 percent and Qatar supplies about 10 percent in liquefied form, or LNG. The Obama administration has begun issuing permits to begin exporting LNG produced in America, but the first shipment wouldn't go out until late 2015.

Berzina says it's likely there might be other options in the future of where Europe can buy its gas.

BERZINA: There is always discussion about the potential of the eastern Mediterranean natural gas that is offshore in the waters of Cyprus and Israel. At the same time, there are new developments for natural gas production and liquefaction and export also in East Africa. So I believe that if we fast-forward to 2018, 2019, we'll have a completely different natural gas landscape and potentially a much more resilient Europe.

NORTHAM: The current crisis has renewed talk about developing a shale gas industry on European soil. But Will Pearson, director of global energy and natural resources at the Eurasia Group says the method of fracking or hydraulic fracturing for shale is extremely controversial in Europe.

WILL PEARSON: France, Bulgaria, many countries have very heavy restrictions or bans on fracking, whereas others, like the U.K. and Poland, are pushing quite hard to develop their resources. It's a slow process to get projects approved, and it's very much a nascent industry and very few wells have been drilled.

NORTHAM: Europe currently has to rely on Russia for roughly one-third of its natural gas but it has taken steps to make sure it's not caught short if Moscow turns off the spigot, says David Goldwyn, who was the U.S. State Department's special envoy to promote shale gas overseas. He says the EU eliminated a prohibition on the sale of gas, even Russian gas, from one country to another.

DAVID GOLDWYN: Second, they've done a lot to build gas storage and that would allow Ukraine to make it through, you know, the spring and the summer, if need be, if Russia were to cut off their supply of gas. And they have now a great deal more interconnections than they had five years ago so that you can move gas around the continent. They literally enabled a pipeline system in one country to connect the pipeline system in another.

NORTHAM: These three things make it possible to reverse the flow of gas if Russia cuts supplies. Countries such as Germany, which has huge amounts of gas in storage, could pump it back towards Ukraine, so reducing Ukraine's dependence on Russia, at least for a while. Jackie Northam, NPR News, Washington. Transcript provided by NPR, Copyright NPR.