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EU unveils vast energy plan to diversify supplies, protect environment
By Leigh Thomas
AFP
BRUSSELS
Petroleumworld.com 01 11 07The European Commission unveiled a vast plan Wednesday to diversify EU energy sources, slash carbon emissions and boost competition in the face of tension over Russian oil and gas supplies and global warming fears.
Calling for a "post industrial revolution", the European Union's executive arm said the 27-nation bloc "needs new policies to face new realities." Some provisions of the proposal drew immediate objections from France and Germany, however.
"Europe must lead the world into a new, or maybe one should say, post industrial revolution -- the development of a low carbon economy," commission chief Jose Manuel Barroso told journalists.
"We have already left behind our coal-based industrial past, it is time to embrace our low carbon future," he added.
The main planks of the package, which the commission hopes EU leaders will endorse at a summit in March, include plans to cut greenhouse gas emissions to 20 percent of 1990 levels by 2020 and to spur competition by demanding that big energy companies separate production and distribution operations.
Environmentalists charged that the emissions target was not ambitious enough however, while some EU governments, notably France, balked at the prospect of energy companies having to break up their operations to boost competition.
Energy issues have climbed to the top of the EU's political agenda over the last year owing to surging oil prices and concerns about the reliability of Russian oil and gas supplies.
Fresh anxiety about Russian energy was sparked this week after the flow of Russian oil to five EU states -- including Germany -- was disrupted due to a transit dispute between Moscow and Belarus.
But Belarus said Wednesday it had lifted a demand that Russia pay transit fees on oil exports passing through Belarussian territory, clearing the way for a resolution of the dispute.
Barroso nonetheless maintained that the flap had damaged the credibility of both sides and said it was "unacceptable" that EU supplies could be cut without consultation.
"We believe that it is not in the interests of the supply countries or the transit countries to appear as not credible," he said. "We believe that it is their duty to try to restore the credibility they have enjoyed for so long."
Moscow dismissed such criticism, with a foreign ministry official asserting that Russia had kept EU partners "fully informed about the matter", according to the Interfax news agency.
Despite reservations about Russian supplies, the EU's dependency is only likely to grow in coming years as the bloc becomes more reliant on imports to meet European demand.
If policies were not changed, the EU's energy import dependence would rise from 50 percent currently to 65 percent in 2030, the commission warned.
Boosting the use of renewable energy could be one option for easing reliance on foreign supplies with the commission proposing that member states commit to meeting 20 percent of their needs with sources like wind and solar energy by 2020.
But environmentalists said the targets for renewables and greenhouse gas emissions fell far short of what was needed to meet the challenge of global warming.
"Commission President Barroso's bluster about a 'new industrial revolution' cannot mask the holes in this energy strategy," Luxembourg EU parliamentarian Claude Turmes said.
The commission's plans to boost competition in gas and electricity sectors also came under fire, even though Brussels warned that Europeans were paying too much for their energy.
An official at the French industry ministry said: "We have two points of disagreement with the commission, which are the possible eventual abolition of controlled (energy) prices and the question of separating asset ownership by integrated operators."
The French objection focused on a commission call for the "unbundling" of production and distribution activities.
The commission found that competition was in particular stifled by big energy groups with supply, generation and network activities that reduced potential competitors' access to critical market information.
German Economy Minister Michael Glos also sounded a note of caution, saying: "The commission is now talking about unbundling of ownership and we need to verify first whether this is compatible with the (German) constitution."
AFP 10 1717 GMT 01 07
Copyright© 2001 AFP.All Rights Reserved.
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