In addition to the economic and climatic damage

Russia's "gas war" threatens political stability in the European Union

  • Europeans fear a complete interruption of Russian gas.

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  • Europe is highly dependent on Russian gas.

    archival

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Russian President Vladimir Putin is ratcheting up pressure on the European Union by cutting off gas shipments to some of Russia's best customers, amid anger over sanctions imposed on his country after the invasion of Ukraine.

Moscow is putting enormous political pressure on governments, threatening to leave Europeans frozen if the next winter turns cold, and potentially undermining the climate bloc's goals as countries replace gas-fired energy with coal.

And it could even push the continent into recession.

Simon Tagliabitra, an analyst at Bruegel Research, describes Russia's policies as "energy blackmail."

40% of the gas flows along the Nord Stream pipeline, which extends from Russia to Germany under the sea, affecting deliveries to France, Italy and Austria, as well as Germany.

Russia's Gazprom, which has a gas export monopoly, halted all deliveries to Poland, Bulgaria, the Netherlands, Finland and Denmark, after energy companies in those countries refused to comply with the Kremlin's demands to pay delivery costs in rubles.

In response, some countries are planning to launch coal-fired power plants.

"It must be recognized that Putin is reducing gas supplies to Europe little by little, and also to raise prices, and we must respond to that by taking measures," German Economy and Climate Minister Robert Habeck said in a television interview last week, adding, "This is a tense and dangerous situation."

coal burning

Meanwhile, Austria plans to restart its coal-burning power plant.

Poland plans to subsidize coal used to heat homes.

Last week, the Netherlands decided to scrap previous plans to limit production at four coal-fired power plants.

"If these weren't exceptional times, we would never have done it," said Climate Minister Rob Getten.

The Italian government held a crisis meeting, and Prime Minister Mario Draghi ordered the operation of two units to re-convert liquefied natural gas into natural gas. He also spoke with countries, including Qatar, Angola and Algeria, to sign agreements to supply gas;

In a desperate attempt to secure supplies in the event of a disruption from the Russian side.

Show confidence

In addition, Brussels appears eager to show confidence, but the concern is clear.

“We view the situation we are in now as very serious,” European Commission President Ursula von der Leyen said at a meeting with journalists last week.

We are ready,” he continued, “We are in difficult times, and things are not improving.”

The rush to burn coal to secure energy supplies is an embarrassment for climate-conscious Europeans.

But few expect that it will drive the European Union, or its member states, off track in their efforts to reduce greenhouse gas emissions.

And in Germany, officials insist that a return to coal will be short-lived and will not jeopardize the country's path to phase out coal power by 2030. Coal will serve as a back-up for the energy sector, allowing the country to secure its needs before winter.

Meanwhile, the government plans to ramp up clean energy, quickly.

Simon Muller, director of the Agoda Energy Research Center, said that the Russian invasion has boosted political support for renewables in Germany. It is very important to build renewable energy.”

The German parliament is considering 10 measures for energy efficiency and renewable energy, and Mueller said the three-party coalition was broadly cohesive on the importance of removing barriers to green energy.

The green groups, too, were optimistic.

"There is absolutely no plan, in Germany, at the moment, to set an end date for coal," said Christoph Balz, policy director at German Watch.

But the need for a rapid change in the trajectory of coal disposal is exacerbating political tensions.

In Berlin, the conservative opposition criticized Habeck and Chancellor Olaf Scholz for allowing more coal use, while ruling out keeping Germany's three remaining nuclear power plants running beyond the end of this year.

"I don't understand how the government is allowing more coal plants to run for longer, instead of carbon-neutral nuclear power plants," the deputy chair of the Christian Democrats in parliament, Jens Spahn, told German television last week.

One of the policies adopted by the former leader of his party, Angela Merkel, was the policy of "abandoning nuclear energy".

This policy is also causing pressure within the ruling coalition.

rationalization of consumption

"The necessary thing now is to keep the remaining three nuclear power plants operating for a longer period of time," said Bijan Gir Saray, secretary-general of the Liberal Democrats. "This is a fact that the economy minister cannot simply ignore."

Habeck said that the recognition of the move was a "taboo breaking," adding that coal is still better than reviving nuclear energy, stressing that the change in nuclear policy will only have an impact at the end of next year;

It's too late to help this winter.

He was endorsed by Chancellor Olaf Scholz, who said in a recently published interview that "nuclear power is not going to help us, now, not in the next two years, which is what matters."

gas rationing

Political leaders are calling on their people to rationalize energy consumption and reduce gas use, while governments work to increase storage levels to allow the continent to weather the Russian winter gas outage.

As a last resort, they are considering gas rationing.

An interruption of gas supplies would almost certainly push the European bloc into recession.

The European Central Bank has warned that the euro zone will shrink by 1.7% next year if Russia turns off the tap completely.

"Energy supply disruptions and low prospects for an immediate replacement of gas supplies from Russia are likely to require some rationing and resource reallocation, leading to lower production in the eurozone, especially in energy-intensive sectors," the bank said.

The bank predicted that if that happens, the bloc's economy will recover next year.

But the European Central Bank also warned Russian President Vladimir Putin, "With regard to the Russian economy, the scenario is characterized by a sharp recession with a contraction in production, similar to the contraction that occurred when the Soviet Union collapsed."

The rush to burn coal to secure energy supplies is an embarrassment for climate-conscious Europeans.

1.7%

The rate of eurozone contraction, next year, if Russia stops supplies completely.

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