The health of the overall European economy is at stake

Most of the energy ministers supported the plan to reduce winter consumption by 15 percent, the southern states that use less or no Russian gas rebelled.

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As of today, Gazprom is reducing deliveries via Northern Stream 20 to 1 percent, Photo: Reuters
As of today, Gazprom is reducing deliveries via Northern Stream 20 to 1 percent, Photo: Reuters
Disclaimer: The translations are mostly done through AI translator and might not be 100% accurate.

Members of the European Union have agreed to reduce gas consumption this winter in an attempt to avoid a crisis with energy supplies due to an additional reduction in deliveries from Russia.

Energy ministers from 27 countries largely backed the plan to voluntarily cut gas consumption by 15 percent during the winter, but accepted several exemptions for island states and countries that are not or have little connection to the European gas network, which will reduce the overall effect.

The European Commission announced that the collective goal for saving gas of 15 percent will reduce consumption by 45 billion cubic meters. When exemptions are taken into account, the final figure will be lower, following the revolt of southern European countries that use little or no Russian gas.

The deal was reached less than 24 hours after Russia's state energy firm Gazprom announced a huge cut in gas deliveries via the Nord Stream 1 pipeline starting today.

Ukraine
photo: Graphic News

EU leaders have accused Russian President Vladimir Putin of trying to blackmail European countries for supporting Ukraine. With Russia cutting off or cutting supplies to 12 EU members, Brussels is urging members to save gas and stock up for the winter for fear that Russia will turn off the tap completely in retaliation for Western sanctions over its war in Ukraine.

Welcoming the rationalization agreement, European Commission President Ursula von der Leyen said: "Gazprom's announcement that it is further reducing gas supplies to Europe via Nord Stream 1, without justifiable technical reason, further illustrates the unreliable nature of Russia as an energy supplier. Thanks to today's decision, we are now ready to deal with our energy security at the European level, as a Union".

Czech Industry and Trade Minister Jozef Sikela, who chaired the meeting after several days of negotiations, said the decision was not easy, but that the sacrifice was necessary and meant Europe could avoid "dramatic consequences for winter", including price increases.

"The EU is united and in solidarity. Today's decision clearly shows that the member states will stand against any Russian attempt to divide the Union by using energy supply as a weapon. The adoption of the gas reduction proposal in record time has unequivocally strengthened our common energy security".

However, support for the energy saving plan was not unanimous. Hungary, which has already secured an exemption from the EU embargo on Russian oil, was alone in its opposition. She was represented at the meeting by Minister of Foreign Affairs Peter Sijarto, who received the award from Putin last November. Hungary supported EU sanctions against Russia, but blamed the measures for increasing prices for Hungarian drivers and households. Brussels rejects that connection.

Czech Industry and Trade Minister Jozef Sikela said the decision was not easy, but that the sacrifice was necessary and meant Europe could avoid "dramatic consequences for winter", including price increases

Poland approved the final deal, but Climate Minister Anna Moskva said one country's industry should not be forced to use less gas to help other countries facing shortages.

According to the savings plan, all EU countries will strive to reduce gas consumption by 15 percent from August 1, 2022 to March 31, 2023, compared to the average consumption over the past five years. Consumption cuts can become binding in the event of a stockpile emergency, but only if a majority of the 15 EU states agree. The European Commission can propose that the binding reduction be activated if there is a risk of serious gas shortages in Europe, or if at least five countries request it.

States will be exempt from the mandatory 15 percent reduction if they are insular or not connected to the gas networks of other states, such as Ireland, Malta and Cyprus. The Baltic states, whose electricity systems are connected to Russia, will only get an exemption if Russia cuts that connection.

Member states can also request exemptions or reductions in the savings target if they have little connection to the European gas network and can send liquefied natural gas to their neighbors, a provision that affects Spain. Spain, along with Portugal and Greece, led opposition to the flat 15 percent target, arguing it was unfair and did not take into account their national circumstances.

Critics have argued that the plans are designed to help Germany, which has been accused of allowing itself to become dangerously dependent on Russian gas.

"Germany made a strategic mistake in the past with its heavy dependence on Russian gas and the belief that it would always flow steadily and cheaply," said German Economy Minister Robert Habeck. "But it's not just a German problem".

He added that the austerity deal would show Putin that Europe remained united after Russia's latest cut in gas supplies.

"You will not divide us," Habek said.

Critics object that the plans are designed to help Germany, which has come under accusations that it allowed itself to become dangerously dependent on Russian gas

The French minister for energy transition, Agnes Panier-Runascher, said that the health of the entire European economy is at stake. "Our industrial chains are completely interdependent: if the chemical industry in Germany coughs, the entire European industry could grind to a halt".

Gazprom justified the latest reduction by the need to stop the operation of one turbine, which the EU Commissioner for Energy, Kadri Simson, rejected and assessed as a "politically motivated" move.

Commissioner Kadri Simson and Minister Jozef Sikela yesterday in Brussels
Commissioner Kadri Simson and Minister Jozef Sikela yesterday in Brussels photo: Reuters

She said the deal should ensure countries save enough gas to see them through an average winter if Russia completely cuts off supplies, but an unusually cold winter would require tougher measures.

Russia, which provided 40 percent of the EU's gas before it invaded Ukraine, says it is a reliable energy supplier.

Germany "worst in class"

A decade after its government warned southern European countries to "do their homework" and implement painful fiscal changes to end the sovereign debt crisis, Germany is slowly adjusting to the humiliating reality that it is worst in class when it comes to reliance on Russian gas, the Guardian writes. ".

While EU members have been trying to agree on a reduction in gas demand in recent days, the southern states have made it clear that they are not willing to agree to a 15 percent reduction in countries that are less vulnerable than Germany.

"They cannot ask us for a sacrifice that we were not even consulted about," said the Spanish Minister for Environmental Transition, Teresa Ribera. "We did not live beyond our means when it comes to energy," she added.

While Germany remains dependent on Russia for about a quarter of its gas needs as of the end of June and is struggling to expand infrastructure to import liquefied natural gas (LNG), Spain has greatly expanded its LNG structure and is now almost independent of Russian gas imports.

Using a phrase that was popular among German ministers at the height of the eurozone crisis, Ribera said: "We did our homework."

The turn in the block did not go unnoticed in Germany.

"Some countries suffered greatly during the financial crisis and had to listen to the words of the Germans," the "Zidejche Zeitung" newspaper announced. "And now they are expected to save a lot of gas in order to rescue those same Germans, who brought themselves into this situation with a wrong energy policy."

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