Ursula van der Leyen and European Commission Vice President Franz Timmermans in Brussels on July 20, 2022. (AFP / John THYS)
Brussels proposed a plan on Wednesday to cut European gas demand by 15% to curb the heating of some buildings, postpone the shutdown of nuclear power plants and encourage companies to reduce their demand… to offset a drop in Russian supplies.
To get through the winter without a major disaster, the European Commission has prepared an arsenal of measures to help the EU27 cope with a possible disruption in Russian supplies – which accounted for 40% of their gas imports last year.
“Russia is using gas as a weapon. In the event of a total shutdown, Europe must be prepared,” said EU executive Ursula van der Leyen.
Twenty-seven have specifically suspended the restart of the Nord Stream gas pipeline, which carries a third of Russian gas supplies to the EU, and has been closed since July 11 for routine maintenance. Moscow cut its supplies through this line by 60% in June.
However, President Vladimir Putin on Wednesday questioned the status of a repaired gas pipeline turbine in Canada, currently in transit in Germany, after suggesting that Nord Stream could only restart at 20% of its capacity. German operator Cascade, however, pledged to forecast a return to “before maintenance” or 40% capacity levels from Thursday.
Map showing the evolution of gas reserves in Europe on July 17 (AFP/)
Faced with uncertainty over Russian supplies, the Brussels plan – which has yet to be verified by member states – provides that each country must do “everything possible” to reduce its gas consumption between August 2022 and March 2023. 15% compared to the average of the last five years during the same period.
States have to outline their road map by the end of September. Some, such as Finland and the Netherlands, have already met the target.
In the event of a “severe deficit risk”, Brussels wants to implement an alert mechanism – after consulting the states – which is a 15% reduction “binding” for the twenty-seven.
The plan, which will be scrutinized by European energy ministers on July 26, is subject to strong reservations from several states, including Poland and Spain. “On an effort basis, we will oppose the imposition of duties beyond what is acceptable to us,” thundered Spanish Environmental Change Minister Teresa Ribera, saying it was not a “fair” or “effective” move.
Commission vice-president Franz Timmermans warned, however, that “we must act now” to avoid doing so “hastily in the most catastrophic circumstances”.
Despite an increase in gas imports from Norway, Azerbaijan and Algeria and a tripling of US liquefied natural gas exports since March, Europeans fear a tough winter.
Ursula von der Leyen during a presentation in Brussels on July 20, 2022 of the EU plan to reduce gas consumption in view of winter (AFP / JOHN THYS)
Ms van der Leyen estimated that annual gas consumption in the EU could be reduced by around 45 billion m3. By comparison, Russia delivered about 155 billion m3 in 2021 to twenty-seven.
With control measures for public and commercial buildings (the initial plan consulted by AFP recommended a 19 degree heat shutdown), as well as communication campaigns to encourage households to reduce heating or air conditioning, around 11 billion m3 could be saved. Thermostat 1 degree.
About 11 billion could be saved by increasing the use of renewable energies and 7.2 billion by reducing industrial consumption, which is already reeling under the effects of rising prices.
“Protected customers” (households, social services, hospitals, SMEs, whose supply is guaranteed) account for less than 37% of total gas consumption. Hence the Commission specifically targets consumption by power plants and industry.
– “Irreversible Impact” –
Ursula von der Leyen and President of Azerbaijan Ilham Aliev in Baku on July 18, 2022
For electricity generation, “renewables should be prioritized, but the use of coal, oil, nuclear energy may prove necessary on a temporary basis”, recognizes Brussels, which is asking countries that want to give up civil nuclear to postpone their plans. Shut down nuclear power plants.
For producers, the text recalls alternative solutions (biomass or biomethane, electrification of some machinery, etc.) and proposes states to establish “auction systems” that provide companies with “compensations” in return for consumption reductions.
While protecting the production of essential goods (medicines, etc.) and helping sectors with less room for manipulation like chemistry, the Commission wants to avoid losses that could be destroyed by factory closures and wholesale shutdowns of machinery. Uses gas as raw material.
A complicated equation: Production cuts imposed on companies could have “disastrous economic consequences and an often irreversible impact,” European employers’ organization BusinessEurope warned on Wednesday.
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