The gas dispute continues to take on new angles. In a telephone call yesterday, Russia’s president told the German chancellor that the contracting parties could continue to pay in euros – Gazprom Bank would simply convert the money into rubles. In Berlin, however, Putin was rejected; Scholz merely asked for written information. Further, the G7 decision still applies: Payment will be made in dollars and euros. So a delivery stop is not yet out of the question. Read Manuel Berkel and Till Hoppe’s Feature on how Germany and other countries are preparing for this.
In addition to the comprehensive specifications on the energy efficiency of energy-consuming products, the EU now wants to impose specifications on the repairability and sustainability of almost all product groups. Manuel Berkel took a look at the amendment to the Ecodesign Directive, which was presented yesterday, and explains to what extent tablets and smartphones are also affected.
An agreement was recently reached on the Digital Markets Act, and the fourth trilogue on the Digital Services Act is due to take place today. One major issue will be who will ultimately be responsible for enforcing the regulation and who will bear the costs. Falk Steiner has written about why the polluter pays principle can be a solution, but also brings new problems with it.
Shortly before the deadline, MEPs from the Greens and S&D groups have filed an objection to the EU’s proposed classification of nuclear energy and natural gas as “green” energy types – so the jury is still out on this. Read more in the News.
In today’s Opinion, Helen Clark, Dan Smith, and Margot Wallström write why getting rid of Russian gas and oil as soon as possible is important not only for energy security. Phasing out fossil fuels and expanding renewables also prevents conflict because the effects of climate change destabilize places fastest where tensions are already high.
The Kremlin’s deadline was supposed to expire tomorrow, and Russia would then only accept payments in rubles for gas deliveries. This was announced by President Vladimir Putin. Yesterday, however, there was a telephone conversation between him and Chancellor Olaf Scholz. According to government spokesman Steffen Hebestreit on Wednesday evening, Putin said that nothing would change for the European contract partners. Payments would continue to be made exclusively in euros and transferred as usual to Gazprom Bank, which is not affected by the sanctions. The bank would then convert the money into rubles.
Hebestreit emphasized that Scholz had not agreed to this procedure but had only asked for written information. Putin had asked for the discussion. He added that the G7 agreement remains in force: Energy deliveries will be paid for exclusively in euros or dollars. Just as the treaties stipulate.
The fact that the dispute over gas payments has still not been resolved was also shown yesterday by news from Brussels. The Commission is preparing new sanctions against Russia, as Reuters reported in the evening. The extent of the new measures would depend on Moscow’s stance on gas payments in rubles. Putin plans to meet today with representatives of Gazprom and the Central Bank to be informed about the state of affairs.
For the Federal Republic of Germany, Economics Minister Robert Habeck yesterday put the early warning stage of the “Emergency Plan for Gas” into effect. There are currently no supply bottlenecks, he stressed in the morning. “Nevertheless, we must increase precautionary measures in order to be prepared, in the event of an escalation on the part of Russia.”
Brussels expects other member states to follow Germany’s lead. Austria also issued an early warning yesterday, while Italy and Latvia had already done so at the end of February and the beginning of March respectively. The Dutch Ministry of Economic Affairs, on the other hand, said yesterday that it did not consider the time to have come yet. Commission Vice President Frans Timmermans said the authority would “work very closely with the member states so that everyone can prepare well for this situation”.
Under the SoS Regulation, the EU member states are obliged to take precautions against disruptions in gas supply. They had to develop prevention and emergency plans and create the necessary infrastructure, for example, to allow gas to flow from west to east through the pipelines.
The central plan for Germany is the Emergency Plan for Gas. It provides for three stages, the first of which Habeck has now initiated. The second stage sounds an alarm if there is a “significant deterioration in the gas supply situation” but gas suppliers can still manage without government intervention.
The third “emergency” stage takes effect only if the market can no longer get the situation under control. The Federal Network Agency then decides, in consultation with the network operators, which gas consumers will still be supplied. Certain consumer groups have priority, in particular private households, hospitals, and gas-fired power plants that also supply households with heat.
If national emergency measures are not sufficient, the solidarity mechanism at EU level kicks in: Neighboring member states are to help out to ensure that vulnerable consumers in the country affected by the bottleneck can continue to be supplied. They should first try to organize additional supplies from gas suppliers. If this does not succeed, they themselves are to restrict supplies to customers in their country who are not in need of protection. The details, including the modalities of financial compensation, will be defined in the bilateral agreements.
The German government is currently negotiating such solidarity agreements with seven European countries. A spokeswoman for the Federal Ministry of Economics and Technology said yesterday that a signing with Italy is imminent, and negotiations with Poland and the Czech Republic are at an advanced stage. With France and the Benelux countries, the exchange is being deepened. Solidarity agreements have already been signed with Denmark (December 2020) and Austria (December 2021).
In circles of the German government and the EU Commission, it was said that it was simply not known whether Putin was serious and would throttle supplies if the EU and the G7 insisted on the contractually agreed settlement in dollars and euros. The declaration of the first stage of the emergency plan should first and foremost send a signal. To the Kremlin, but also to the domestic industry to prepare for the emergency. Renew MEP Andreas Glück doubts Putin’s resolve: “For the Russian economy, the income from energy exports is irreplaceable.”
With the proclamation of the early warning stage, a crisis team convenes at the BMWK, consisting of representatives of the Federal Network Agency, the market area manager for gas, the transmission system operators, and the federal states. The suppliers must now regularly inform the authorities about the situation.
It is important that all parties involved have a clear roadmap on their rights and obligations in the event of a supply interruption, said Kerstin Andreae, Chairwoman of the Executive Board of the German Association of Energy and Water Industries (BDEW). “We now have to prepare the emergency stage in concrete terms, because in the event of a supply interruption, things have to happen quickly.”
The Federal Network Agency (BNetzA) has already taken precautions for a widespread failure of gas supplies. A situation center has been set up on the agency’s premises, where the crisis teams will find all the necessary information and communication facilities in 24-hour operation, the agency announced. For the emergency level, the BNetzA has already gathered and trained 65 experts each for gas and electricity crisis teams. Accordingly, the load balancing tasks could be performed on a permanent basis in shift operation. A certain safety buffer for possible COVID-related outages has also been planned.
According to the BNetzA, there is to be no abstract shutdown sequence for certain industrial plants or other large gas consumers: “The decisions to be made in a shortage situation are always decisions on a case-by-case basis, because the circumstances then applicable depend on so many parameters (including gas storage levels, weather conditions, European requirements, savings achieved, etc.) that they cannot be predicted.” However, the agency is developing criteria that can be used for overall consideration in individual cases.
The network agency and the Federal Office of Civil Protection and Disaster Assistance had practiced a gas shortage situation in 2018. As part of LÜKEX 2018, the BNetzA obtained basic information from all major gas consumers in Germany about their connection and consumption situation. Currently, the network agency is updating this information with high priority and is also significantly expanding the survey of companies and connection network operators for this purpose. The information collected is being fed into a new gas security platform.
Industry warns of the far-reaching consequences of a gas supply disruption. “In the event of extensive supply disruptions, there is a threat of production stoppages with incalculable consequences for growth, supply chains, and employment,” said BDI President Siegfried Russwurm.
The chemical industry paints a particularly dramatic picture. “If our industry ran out of gas, we would have to shut down production plants,” Christian Kullmann, head of the industry association VCI, told the Reuters news agency. “Once chemical plants are shut down, they stand still for weeks and months,” said Kullmann, who is also head of specialty chemicals group Evonik. Then, a short time later, the assembly lines in other sectors such as the automotive industry or mechanical engineering would follow suit. “There would be a huge domino effect through almost all industries,” Kullmann warned, “it would be an industrial conflagration”. If some economists assume that a deep recession can be avoided without gas, they are “academic reveries“. By Manuel Berkel and Till Hoppe
The core of the circular economy package presented on Wednesday is the amendment of the Ecodesign Directive (Europe.Table reported). While for years only energy efficiency requirements applied to energy-related products, in the future, almost all product groups will have to meet extensive sustainability criteria – from the recycled content of materials to reparability. “European consumers rightly expect more environmentally friendly and durable products. Greater sustainability and resource efficiency also mean greater resilience when a crisis disrupts our industrial supply chains,” said Internal Market Commissioner Thierry Breton.
By 2030, the new regulatory framework can help save the energy content of 150 billion cubic meters of natural gas, almost equivalent to the EU’s imports from Russia, according to the Commission.
Despite the expansion of the Ecodesign Directive, not all energy-related products are covered by specific rules. The Commission, therefore, also presented a work plan for ecodesign and energy labels until 2024 on Wednesday. According to the plan, new rules for smartphones and tablets are to be adopted by the end of 2022. In addition to energy efficiency, this will also address aspects of material efficiency: durability, reparability, and recycling.
“The right to repair will finally become a reality with this proposal, when, for example, the replacement of the battery finally becomes a reality,” said Green Party MEP Michael Bloss. “At the same time, manufacturers must finally explain why they simply burn intact goods when they are returned. This clandestine waste of resources is unacceptable and must be banned. But the Commission proposal misses this clear demarcation.”
For information and communications technology products, the Commission is working on a study that will look at overall energy consumption – including data transmission, connectivity, and user behavior. The authority is also looking at firmware and software. For energy smart appliances, on the other hand, there is to be voluntary regulation by the industry to ensure the interoperability of the devices.
In the fourth quarter, the Commission also intends to implement the announced specifications for photovoltaic modules. It is still being examined whether there should also be limit values for the CO2 footprint. The most promising candidates for new energy specifications are also radiators – with the necessary switch to heat pumps, a large-scale replacement of heat exchangers is also to be expected.
Existing regulations for 46 product groups such as servers are also to be revised by 2025. New regulations for space heaters alone are expected to save 50 terawatt-hours (TWh) of electricity per year and 40 TWh for water pumps.
In addition to information on energy labels, the Commission wants to strengthen other consumer rights and take action against greenwashing and planned obsolescence – the deliberate rendering of products unusable after a certain period of time, even though there is no serious wear and tear. In the future, unfair business practices are to include:
In the future, retailers will also be required to inform their customers about manufacturers’ guarantees on the durability of products that extend beyond two years. There will also be information requirements on the reparability of products, for example, in the form of a separate indicator.
An amendment to the Construction Products Regulation will make it easier to recycle construction materials in the future. A digital product passport and a database for construction products will also be introduced. According to the Commission, buildings are responsible for half of the resources consumed in the EU and for 30 percent of the waste generated.
“For almost 10 years, the system of technical regulation and standardization of construction products has proven to be a catalyst for competitiveness and innovation. Unfortunately, this system has been faltering for some years. I therefore welcome the fact that today, with the published revision of the Construction Products Regulation, the Commission intends to clear the backlog of harmonized standards in the construction products sector that has prevailed for several years and to close existing legal gaps,” said Christian Doleschal, a member of the CSU.
“However, I am critical of the fact that the Commission is now also regulating all sustainability requirements for construction products in one and the same regulation, which regulates the safe use of construction products. This not only creates more bureaucracy and overregulation, but also slows down innovation,” the MEP said.
The Commission also wants to regulate the eco-design of textiles. It also wants to tackle the problem of microplastics. “In three years, according to European law, all member states must collect textiles separately from household waste,” explained SPD MEP Delara Burkhardt. “The textile strategy can only be successful and offer added value if the social dimension is also considered. It must set environmental standards in the textile supply chain, which at the same time also makes workers’ rights mandatory.”
DMA, DSA, and AI Regulation have one thing in common: Their effectiveness is questionable without enforcement. How this is to be done in concrete terms is one of the thorny questions, that is answered differently in each of the legislative acts. Particularly under the impression of deficits in the decentrally organized enforcement of the GDPR by national authorities, Parliament, Council, and Commission have pushed ahead with the search for alternative models. One of the lessons of the GDPR: If nation states have a strong vested interest in a weak supervisory authority, European consistency of enforcement is hard to guarantee. However, this would be a massive problem for the effectiveness of the DSA, DMA, and AI Act.
This is why an unusual event occurred in the discussion about the Digital Services Act: France, which otherwise so often pays attention to national sovereignty, proposed that the Commission should supervise online platforms with lower hurdles than originally planned. The goal: National supervisory authorities – called Digital Services Coordinators in the DSA – should not be able to creatively interpret the European legal framework for important companies under any circumstances to give locational advantages to the country where the company or its main European representative is based. In the case of the GDPR, it had become apparent that such behavior can only be recaptured by long and circuitous routes, if at all.
But above all, the personnel capacities for direct supervision by the Commission are limited, which is why Vice-President Margrethe Vestager surprisingly raised the issue on the fringes of the third DSA trilogue: Wouldn’t it be a good idea to make the supervised pay for their own supervision? After all, there are already precedents for this – for example, in environmental law, where the so-called polluter pays principle is widely applied. And in banking supervision, too, the supervised parties share in the costs.
A proposal by the Green Group in the EP on the DSA, Amendment 2075, had presupposed the introduction of an independent European supervisory authority, which would have been refinanced via the polluter pays principle. An “annual supervisory fee for very large online platforms” should have been effective here in addition to the budget provided by the EU. But there was no majority in the European Parliament for this. Yet there is already a model in the EU’s digital legislation.
The model of the eIDAS Regulation would be radical: There, Article 20 contains a provision whereby so-called qualified trust service providers must be audited by special conformity assessment bodies at the latest every two years at the expense of the providers. The supervisory authorities can also initiate a special audit at any time. Here, too, the audit costs must be borne by the service providers. The requirements of the eIDAS Regulation could easily be transferred to the DSA.
But would that be desirable? “When regulators profit from fines or their actions against companies, that always creates problems,” says Ben Wagner of Delft University of Technology. The specialist in digital governance mechanisms sees an independent European enforcement authority as a better solution than enforcement directly by the Commission. He is critical of the polluter pays principle: “It would be better to have a clean, proper funding of the authority, staggered according to the actual effort.”
Bitkom does not think much at all of ideas like polluter pays. “Usually, in the case of competition authorities, the state or the community of states bears the costs of enforcing the law and is the recipient of the fine payments in the case of rule violations,” says the head of trust and security, Rebekka Weiß. “We see no reason why this should be done differently in the case of DSA oversight.”
Commission sources said that a mixed model is being considered: Commission funds would be used to provide a basic level of personnel. The levies of the companies concerned would be used for this purpose, on a case-by-case basis or for a limited period of time, the use of seconded national experts as well as external support.
He thinks a supervisory fee is an interesting idea in principle, if it would also drive a much-needed expansion of supervisory capacity at national and EU level, says Julian Jaursch, platform regulation expert at the German think tank Stiftung Neue Verantwortung. “It could also provide funding for external experts who should be involved in consultations and supervisory decisions.”
However, the use of external forces could also bring new problems, for example if law firms were to work for regulators and regulated parties with a time lag or even only separated by Chinese walls – and the market for specialized legal and technical experts is obviously empty. Ben Wagner of TU Delft has doubts that the trilogue parties are getting the size of the task right: “The Commission lacks both resources and independence. All the players are not aware, in my opinion, of what a huge effort this is.”
Julian Jaursch also sees a problem here, and calls for a more fundamental discussion among the negotiators due to the polluter pays idea: “If a supervision fee is now suddenly up for debate towards the end of the DSA negotiation, the previously planned supervision structure should also be reconsidered and a specialized, independent EU platform supervision considered instead.” If supervision is financially dependent on the companies, independence must be guaranteed even more strongly.
At the latest, if not only the Commission for its responsibilities, but also the member states were to partially refinance their DSA supervision via supervisory fees, an effect already known from the GDPR could otherwise occur: a kind of non-regulatory competition of the member state supervisory authorities. This is because companies could relocate their headquarters in Europe at any time if the supervision does not suit them. One way to get around the problem is suggested by Julian Jaursch: “If the EU really wanted to innovate, it would not only make large platforms contribute to the costs of EU supervision, but set up an independent fund with a possible fee.”
While the DMA has already been negotiated, with the Commission to counter the largest players with about 80 posts, the issue could play a greater role again today in the fourth DSA trilogue. However, the plea for a corresponding regulation on the part of the Commission has come rather late, according to parliamentary circles. However, it is primarily the member states and the Commission that want to adopt the DSA as quickly as possible. In the case of the AI Regulation, on the other hand, there is still plenty of time to debate the design and load distribution, despite all the haste.
The Green MEPs in the ECON and ENVI Committees and those of the S&D Group in the ECON Committee have officially objected to the Complementary Delegated Act on EU taxonomy. The deadline for opening the objection procedure ended yesterday at 5 p.m.
The classification of nuclear energy and natural gas as sustainable could have entered into force automatically if no objections had been raised in Parliament or the Council. With the objection of the two groups, the procedure for Parliament to vote on the delegated act at a later date has been formally initiated.
The parliamentarians now have until May 30 to submit an opposition resolution, which can also be supported by members of other parliamentary groups. The Greens have announced that they will draft a resolution that will be supported by a broad cross-party alliance.
Rasmus Andresen, a Green member of the ECON Committee, announced that this step would be backed up by sound arguments. “In this way, we want to convince conservative and liberal parliamentarians to vote against the taxonomy as well. In Parliament, criticism of von der Leyen’s proposal is becoming noticeably louder,” Andresen explained.
The S&D Group coordinators will decide on a joint resolution justifying the objection at the end of next week. The vote on the objection resolution in the joint ENVI/ECON committee is scheduled to take place in June, before the plenary votes in July. An absolute majority, which is needed to approve the objection, requires 353 votes. If this is not achieved and there are no objections from the Council either, the delegated act will become legally binding. luk
The Kremlin indicated on Wednesday that all of Russia’s energy and commodity exports could be priced in rubles, toughening President Vladimir Putin’s attempt to make the West feel the pain of the sanctions it imposed for the invasion of Ukraine.
“If you want gas, find rubles,” Volodin said in a post on Telegram. “Moreover, it would be right – where it is beneficial for our country – to widen the list of export products priced in rubles to include: fertilizer, grain, food oil, oil, coal, metals, timber etc.”
With Russia’s economy facing its gravest crisis since the 1991 collapse of the Soviet Union, Putin on March 23 hit back at the West, ordering that Russian gas exports should be paid for in rubles.
In the strongest signal yet that Russia could be preparing an even tougher response to the West’s sanctions, Russia’s top lawmaker suggested on Wednesday that almost Russia’s entire energy and commodity exports could soon be priced in rubles. Asked about the comments by parliament speaker Vyacheslav Volodin, Kremlin spokesman Dmitry Peskov said: “This is an idea that should definitely be worked on. It may well be worked out.” rtr
Russian gas company Gazprom’s offices were raided by EU antitrust regulators, a person familiar with the matter said on Wednesday, as the EU watchdog ramped up its investigation into the company’s gas supplies to Europe. The person declined to provide details of the EU raids.
EU antitrust chief Margrethe Vestager in January asked gas companies including Gazprom about tight supplies after accusations the Russian giant was withholding extra production that could be released to lower rising prices. Vestager was likely to intensify information gathering on Gazprom’s European businesses, a person familiar with the regulator’s thinking told Reuters last month.
The European Commission declined to comment, and Gazprom Export also declined to comment. Bloomberg was the first to report the raids in Gazprom’s offices in Germany. Gazprom and the Kremlin have repeatedly denied withholding gas supplies, saying that all firm and long-term obligations have been met. rtr
European companies are to be given better access to public contracts and procurement procedures in non-EU countries in the future. This is to be made possible by the International Procurement Instrument (IPI).
On Wednesday, the EU member states in the Permanent Representatives Committee approved the agreement reached between the European Parliament and the Council of the EU on the corresponding proposal for a regulation, the Federal Ministry for Economic Affairs and Climate Action announced in a statement on Wednesday. The instrument thus clears a crucial hurdle after around ten years of negotiations since the publication of the first Commission proposal.
Sven Giegold, State Secretary at the German Federal Ministry for Economic Affairs and Climate Action, said the EU wants “transparent and non-discriminatory procurement procedures”. The goal of the IPI is to open up procurement markets in states outside the EU to European companies and to enable fair access to procurement procedures in non-EU countries.
In the future, bids submitted by companies from countries outside the EU that do not make their procurement market sufficiently accessible to European bidders may be deliberately disadvantaged or even excluded during bid evaluation in procurement procedures throughout the EU.
This is intended to increase the willingness of third countries to open their procurement markets to EU companies – for example, by joining the WTO Government Procurement Agreement (GPA) or concluding bilateral market access agreements. The proposal still requires the formal approval of the European Parliament and the Council before it enters into force.
Lufthansa and other airlines in an air cargo cartel have finally failed with their lawsuits against a fine decision by the EU Commission. Fines against Air France, KLM, and others would be upheld and the lawsuits rejected, the EU court announced Wednesday.
Lufthansa and two of its subsidiaries had been exempted from the fine in the EU Commission’s first decision in 2010 because they had disclosed the cartel as key witnesses. Nevertheless, Lufthansa, together with the other airlines, had fought the decision of the competition authority in court. Air France and KLM together have to pay the highest fines, about €300 million. Originally, the EU Commission imposed €790 million in fines on all parties involved.
A dozen cargo airlines colluded on prices between 1999 and 2006. British Airways, SAS, Japan Airlines, and Cathay Pacific Airways were also involved. The companies successfully challenged the EU’s first fine decision in 2010.
The EU court overturned it in 2015 due to “inherent contradictions”. The competition authority imposed the fine again in 2017 with improved justification, but all companies appealed again. For some airlines, the court now reduced the fines, in part because the EU authority violated statutes of limitations. rtr
The United States recently announced an immediate ban on imports of Russian oil and gas, while the United Kingdom and the European Union pledged to curb them more gradually. The rationale is clear: punish Russia, reduce its leverage, and restore peace to Ukraine. But wrong choices now – specifically, continuing to favor fossil fuels over renewable energy – could lock in a far less peaceful future.
Some Western countries have let themselves become overly reliant on Russian oil and gas in recent years, so the decision to cut back was not easy. But the bigger, tougher decision facing Western governments is how to reduce their overall dependence on fossil fuels. Simply replacing one dirty energy source with another would leave the growing dangers of climate change to be dealt with later – if at all.
Given the pressure of the current Ukraine crisis, such shortsightedness would be understandable. Western governments must close the energy gap created by stopping Russian fossil-fuel imports, while minimizing the damage to national economies. For now, they have the public with them. But if energy costs rise too high, or shortages become too disruptive, the resulting economic havoc could erode public support
Any alternative energy sources must therefore come onstream quickly and provide affordable, reliable supplies. And they should not create new geopolitical entanglements that might cause problems later.
At the recent annual CERAWeek energy conference in Houston, Texas, Big Oil CEOs and their lobbyists were quick to propose boosting oil and gas production, removing output caps, easing regulations, and reversing policies aimed at lowering carbon dioxide emissions. Several energy analysts and economists have echoed this line.
But with climate change fast becoming a leading driver of insecurity worldwide, doubling down on fossil fuels would be a tragic mistake – a choice that could make the world a more violent place in the coming decades.
The 2021 Production Gap Report highlighted the disconnect between current fossil-fuel production plans and climate pledges. Under current policies, global warming is on track to reach a catastrophic 2.7° Celsius this century. We need to be rapidly closing down wells and mines and shrinking production, not adding more capacity.
Climate change is already making the world more dangerous and less stable. The latest report from the Intergovernmental Panel on Climate Change (IPCC) – dubbed “an atlas of human suffering” by United Nations Secretary-General António Guterres – offered a stark assessment of the huge economic and human costs of even the early effects of climate change that we are experiencing now. It paints a picture of a future that we must avoid.
A survey of headlines over the past 12 months reveals record floods, storms, wildfires, heat waves, and droughts. All of these weather events are becoming more frequent, extreme, and deadly as a result of climate change, and all of them can increase the likelihood of conflict and instability. Today, 80% of UN peacekeepers are deployed in countries regarded as most exposed to climate change. Likewise, a recent study found that a 1°C increase in temperature was associated with a 54% increase in the frequency of conflicts in parts of Africa where nomadic herders and sedentary farmers compete for dwindling supplies of water and fertile land.
As the IPCC report rightly points out, the consequences of climate change most quickly destabilize places where tensions are already high and government structures are already weakened or corrupt. As research for the forthcoming Stockholm International Peace Research Institute (SIPRI) Environment of Peace report shows, armed extremist groups like al-Shabaab, the Islamic State, and Boko Haram have thrived in regions that are suffering the worst effects of climate change. They find recruits and supporters among people whose lives and livelihoods have become increasingly precarious because of floods and droughts.
In our globalized, networked world, the repercussions of local climate impacts can quickly spread, through supply-chain shocks, spillover conflicts, and mass migrations. And, as Russia’s invasion of Ukraine has demonstrated, the rules-based order is alarmingly fragile, leaving ordinary people to face the terrible consequences.
The West’s rejection of Russian oil and gas creates an opportunity to accelerate the transition away from fossil fuels. Energy efficiencies and other demand reductions can do part of the job. As for the rest, renewable alternatives like solar and wind power make economic sense. They are far quicker and safer to install than nuclear plants or most of the fossil-fuel alternatives being discussed. And they don’t expose people to the spikes and dips of global fuel markets.
The logic points in only one direction. The world will achieve true energy security – and have a chance of building a more peaceful, livable, and affordable future – only if we leave fossil fuels behind.
The authors are all members of the expert panel advising the Environment of Peace initiative at SIPRI.
In cooperation with Project Syndicate, 2022.
The gas dispute continues to take on new angles. In a telephone call yesterday, Russia’s president told the German chancellor that the contracting parties could continue to pay in euros – Gazprom Bank would simply convert the money into rubles. In Berlin, however, Putin was rejected; Scholz merely asked for written information. Further, the G7 decision still applies: Payment will be made in dollars and euros. So a delivery stop is not yet out of the question. Read Manuel Berkel and Till Hoppe’s Feature on how Germany and other countries are preparing for this.
In addition to the comprehensive specifications on the energy efficiency of energy-consuming products, the EU now wants to impose specifications on the repairability and sustainability of almost all product groups. Manuel Berkel took a look at the amendment to the Ecodesign Directive, which was presented yesterday, and explains to what extent tablets and smartphones are also affected.
An agreement was recently reached on the Digital Markets Act, and the fourth trilogue on the Digital Services Act is due to take place today. One major issue will be who will ultimately be responsible for enforcing the regulation and who will bear the costs. Falk Steiner has written about why the polluter pays principle can be a solution, but also brings new problems with it.
Shortly before the deadline, MEPs from the Greens and S&D groups have filed an objection to the EU’s proposed classification of nuclear energy and natural gas as “green” energy types – so the jury is still out on this. Read more in the News.
In today’s Opinion, Helen Clark, Dan Smith, and Margot Wallström write why getting rid of Russian gas and oil as soon as possible is important not only for energy security. Phasing out fossil fuels and expanding renewables also prevents conflict because the effects of climate change destabilize places fastest where tensions are already high.
The Kremlin’s deadline was supposed to expire tomorrow, and Russia would then only accept payments in rubles for gas deliveries. This was announced by President Vladimir Putin. Yesterday, however, there was a telephone conversation between him and Chancellor Olaf Scholz. According to government spokesman Steffen Hebestreit on Wednesday evening, Putin said that nothing would change for the European contract partners. Payments would continue to be made exclusively in euros and transferred as usual to Gazprom Bank, which is not affected by the sanctions. The bank would then convert the money into rubles.
Hebestreit emphasized that Scholz had not agreed to this procedure but had only asked for written information. Putin had asked for the discussion. He added that the G7 agreement remains in force: Energy deliveries will be paid for exclusively in euros or dollars. Just as the treaties stipulate.
The fact that the dispute over gas payments has still not been resolved was also shown yesterday by news from Brussels. The Commission is preparing new sanctions against Russia, as Reuters reported in the evening. The extent of the new measures would depend on Moscow’s stance on gas payments in rubles. Putin plans to meet today with representatives of Gazprom and the Central Bank to be informed about the state of affairs.
For the Federal Republic of Germany, Economics Minister Robert Habeck yesterday put the early warning stage of the “Emergency Plan for Gas” into effect. There are currently no supply bottlenecks, he stressed in the morning. “Nevertheless, we must increase precautionary measures in order to be prepared, in the event of an escalation on the part of Russia.”
Brussels expects other member states to follow Germany’s lead. Austria also issued an early warning yesterday, while Italy and Latvia had already done so at the end of February and the beginning of March respectively. The Dutch Ministry of Economic Affairs, on the other hand, said yesterday that it did not consider the time to have come yet. Commission Vice President Frans Timmermans said the authority would “work very closely with the member states so that everyone can prepare well for this situation”.
Under the SoS Regulation, the EU member states are obliged to take precautions against disruptions in gas supply. They had to develop prevention and emergency plans and create the necessary infrastructure, for example, to allow gas to flow from west to east through the pipelines.
The central plan for Germany is the Emergency Plan for Gas. It provides for three stages, the first of which Habeck has now initiated. The second stage sounds an alarm if there is a “significant deterioration in the gas supply situation” but gas suppliers can still manage without government intervention.
The third “emergency” stage takes effect only if the market can no longer get the situation under control. The Federal Network Agency then decides, in consultation with the network operators, which gas consumers will still be supplied. Certain consumer groups have priority, in particular private households, hospitals, and gas-fired power plants that also supply households with heat.
If national emergency measures are not sufficient, the solidarity mechanism at EU level kicks in: Neighboring member states are to help out to ensure that vulnerable consumers in the country affected by the bottleneck can continue to be supplied. They should first try to organize additional supplies from gas suppliers. If this does not succeed, they themselves are to restrict supplies to customers in their country who are not in need of protection. The details, including the modalities of financial compensation, will be defined in the bilateral agreements.
The German government is currently negotiating such solidarity agreements with seven European countries. A spokeswoman for the Federal Ministry of Economics and Technology said yesterday that a signing with Italy is imminent, and negotiations with Poland and the Czech Republic are at an advanced stage. With France and the Benelux countries, the exchange is being deepened. Solidarity agreements have already been signed with Denmark (December 2020) and Austria (December 2021).
In circles of the German government and the EU Commission, it was said that it was simply not known whether Putin was serious and would throttle supplies if the EU and the G7 insisted on the contractually agreed settlement in dollars and euros. The declaration of the first stage of the emergency plan should first and foremost send a signal. To the Kremlin, but also to the domestic industry to prepare for the emergency. Renew MEP Andreas Glück doubts Putin’s resolve: “For the Russian economy, the income from energy exports is irreplaceable.”
With the proclamation of the early warning stage, a crisis team convenes at the BMWK, consisting of representatives of the Federal Network Agency, the market area manager for gas, the transmission system operators, and the federal states. The suppliers must now regularly inform the authorities about the situation.
It is important that all parties involved have a clear roadmap on their rights and obligations in the event of a supply interruption, said Kerstin Andreae, Chairwoman of the Executive Board of the German Association of Energy and Water Industries (BDEW). “We now have to prepare the emergency stage in concrete terms, because in the event of a supply interruption, things have to happen quickly.”
The Federal Network Agency (BNetzA) has already taken precautions for a widespread failure of gas supplies. A situation center has been set up on the agency’s premises, where the crisis teams will find all the necessary information and communication facilities in 24-hour operation, the agency announced. For the emergency level, the BNetzA has already gathered and trained 65 experts each for gas and electricity crisis teams. Accordingly, the load balancing tasks could be performed on a permanent basis in shift operation. A certain safety buffer for possible COVID-related outages has also been planned.
According to the BNetzA, there is to be no abstract shutdown sequence for certain industrial plants or other large gas consumers: “The decisions to be made in a shortage situation are always decisions on a case-by-case basis, because the circumstances then applicable depend on so many parameters (including gas storage levels, weather conditions, European requirements, savings achieved, etc.) that they cannot be predicted.” However, the agency is developing criteria that can be used for overall consideration in individual cases.
The network agency and the Federal Office of Civil Protection and Disaster Assistance had practiced a gas shortage situation in 2018. As part of LÜKEX 2018, the BNetzA obtained basic information from all major gas consumers in Germany about their connection and consumption situation. Currently, the network agency is updating this information with high priority and is also significantly expanding the survey of companies and connection network operators for this purpose. The information collected is being fed into a new gas security platform.
Industry warns of the far-reaching consequences of a gas supply disruption. “In the event of extensive supply disruptions, there is a threat of production stoppages with incalculable consequences for growth, supply chains, and employment,” said BDI President Siegfried Russwurm.
The chemical industry paints a particularly dramatic picture. “If our industry ran out of gas, we would have to shut down production plants,” Christian Kullmann, head of the industry association VCI, told the Reuters news agency. “Once chemical plants are shut down, they stand still for weeks and months,” said Kullmann, who is also head of specialty chemicals group Evonik. Then, a short time later, the assembly lines in other sectors such as the automotive industry or mechanical engineering would follow suit. “There would be a huge domino effect through almost all industries,” Kullmann warned, “it would be an industrial conflagration”. If some economists assume that a deep recession can be avoided without gas, they are “academic reveries“. By Manuel Berkel and Till Hoppe
The core of the circular economy package presented on Wednesday is the amendment of the Ecodesign Directive (Europe.Table reported). While for years only energy efficiency requirements applied to energy-related products, in the future, almost all product groups will have to meet extensive sustainability criteria – from the recycled content of materials to reparability. “European consumers rightly expect more environmentally friendly and durable products. Greater sustainability and resource efficiency also mean greater resilience when a crisis disrupts our industrial supply chains,” said Internal Market Commissioner Thierry Breton.
By 2030, the new regulatory framework can help save the energy content of 150 billion cubic meters of natural gas, almost equivalent to the EU’s imports from Russia, according to the Commission.
Despite the expansion of the Ecodesign Directive, not all energy-related products are covered by specific rules. The Commission, therefore, also presented a work plan for ecodesign and energy labels until 2024 on Wednesday. According to the plan, new rules for smartphones and tablets are to be adopted by the end of 2022. In addition to energy efficiency, this will also address aspects of material efficiency: durability, reparability, and recycling.
“The right to repair will finally become a reality with this proposal, when, for example, the replacement of the battery finally becomes a reality,” said Green Party MEP Michael Bloss. “At the same time, manufacturers must finally explain why they simply burn intact goods when they are returned. This clandestine waste of resources is unacceptable and must be banned. But the Commission proposal misses this clear demarcation.”
For information and communications technology products, the Commission is working on a study that will look at overall energy consumption – including data transmission, connectivity, and user behavior. The authority is also looking at firmware and software. For energy smart appliances, on the other hand, there is to be voluntary regulation by the industry to ensure the interoperability of the devices.
In the fourth quarter, the Commission also intends to implement the announced specifications for photovoltaic modules. It is still being examined whether there should also be limit values for the CO2 footprint. The most promising candidates for new energy specifications are also radiators – with the necessary switch to heat pumps, a large-scale replacement of heat exchangers is also to be expected.
Existing regulations for 46 product groups such as servers are also to be revised by 2025. New regulations for space heaters alone are expected to save 50 terawatt-hours (TWh) of electricity per year and 40 TWh for water pumps.
In addition to information on energy labels, the Commission wants to strengthen other consumer rights and take action against greenwashing and planned obsolescence – the deliberate rendering of products unusable after a certain period of time, even though there is no serious wear and tear. In the future, unfair business practices are to include:
In the future, retailers will also be required to inform their customers about manufacturers’ guarantees on the durability of products that extend beyond two years. There will also be information requirements on the reparability of products, for example, in the form of a separate indicator.
An amendment to the Construction Products Regulation will make it easier to recycle construction materials in the future. A digital product passport and a database for construction products will also be introduced. According to the Commission, buildings are responsible for half of the resources consumed in the EU and for 30 percent of the waste generated.
“For almost 10 years, the system of technical regulation and standardization of construction products has proven to be a catalyst for competitiveness and innovation. Unfortunately, this system has been faltering for some years. I therefore welcome the fact that today, with the published revision of the Construction Products Regulation, the Commission intends to clear the backlog of harmonized standards in the construction products sector that has prevailed for several years and to close existing legal gaps,” said Christian Doleschal, a member of the CSU.
“However, I am critical of the fact that the Commission is now also regulating all sustainability requirements for construction products in one and the same regulation, which regulates the safe use of construction products. This not only creates more bureaucracy and overregulation, but also slows down innovation,” the MEP said.
The Commission also wants to regulate the eco-design of textiles. It also wants to tackle the problem of microplastics. “In three years, according to European law, all member states must collect textiles separately from household waste,” explained SPD MEP Delara Burkhardt. “The textile strategy can only be successful and offer added value if the social dimension is also considered. It must set environmental standards in the textile supply chain, which at the same time also makes workers’ rights mandatory.”
DMA, DSA, and AI Regulation have one thing in common: Their effectiveness is questionable without enforcement. How this is to be done in concrete terms is one of the thorny questions, that is answered differently in each of the legislative acts. Particularly under the impression of deficits in the decentrally organized enforcement of the GDPR by national authorities, Parliament, Council, and Commission have pushed ahead with the search for alternative models. One of the lessons of the GDPR: If nation states have a strong vested interest in a weak supervisory authority, European consistency of enforcement is hard to guarantee. However, this would be a massive problem for the effectiveness of the DSA, DMA, and AI Act.
This is why an unusual event occurred in the discussion about the Digital Services Act: France, which otherwise so often pays attention to national sovereignty, proposed that the Commission should supervise online platforms with lower hurdles than originally planned. The goal: National supervisory authorities – called Digital Services Coordinators in the DSA – should not be able to creatively interpret the European legal framework for important companies under any circumstances to give locational advantages to the country where the company or its main European representative is based. In the case of the GDPR, it had become apparent that such behavior can only be recaptured by long and circuitous routes, if at all.
But above all, the personnel capacities for direct supervision by the Commission are limited, which is why Vice-President Margrethe Vestager surprisingly raised the issue on the fringes of the third DSA trilogue: Wouldn’t it be a good idea to make the supervised pay for their own supervision? After all, there are already precedents for this – for example, in environmental law, where the so-called polluter pays principle is widely applied. And in banking supervision, too, the supervised parties share in the costs.
A proposal by the Green Group in the EP on the DSA, Amendment 2075, had presupposed the introduction of an independent European supervisory authority, which would have been refinanced via the polluter pays principle. An “annual supervisory fee for very large online platforms” should have been effective here in addition to the budget provided by the EU. But there was no majority in the European Parliament for this. Yet there is already a model in the EU’s digital legislation.
The model of the eIDAS Regulation would be radical: There, Article 20 contains a provision whereby so-called qualified trust service providers must be audited by special conformity assessment bodies at the latest every two years at the expense of the providers. The supervisory authorities can also initiate a special audit at any time. Here, too, the audit costs must be borne by the service providers. The requirements of the eIDAS Regulation could easily be transferred to the DSA.
But would that be desirable? “When regulators profit from fines or their actions against companies, that always creates problems,” says Ben Wagner of Delft University of Technology. The specialist in digital governance mechanisms sees an independent European enforcement authority as a better solution than enforcement directly by the Commission. He is critical of the polluter pays principle: “It would be better to have a clean, proper funding of the authority, staggered according to the actual effort.”
Bitkom does not think much at all of ideas like polluter pays. “Usually, in the case of competition authorities, the state or the community of states bears the costs of enforcing the law and is the recipient of the fine payments in the case of rule violations,” says the head of trust and security, Rebekka Weiß. “We see no reason why this should be done differently in the case of DSA oversight.”
Commission sources said that a mixed model is being considered: Commission funds would be used to provide a basic level of personnel. The levies of the companies concerned would be used for this purpose, on a case-by-case basis or for a limited period of time, the use of seconded national experts as well as external support.
He thinks a supervisory fee is an interesting idea in principle, if it would also drive a much-needed expansion of supervisory capacity at national and EU level, says Julian Jaursch, platform regulation expert at the German think tank Stiftung Neue Verantwortung. “It could also provide funding for external experts who should be involved in consultations and supervisory decisions.”
However, the use of external forces could also bring new problems, for example if law firms were to work for regulators and regulated parties with a time lag or even only separated by Chinese walls – and the market for specialized legal and technical experts is obviously empty. Ben Wagner of TU Delft has doubts that the trilogue parties are getting the size of the task right: “The Commission lacks both resources and independence. All the players are not aware, in my opinion, of what a huge effort this is.”
Julian Jaursch also sees a problem here, and calls for a more fundamental discussion among the negotiators due to the polluter pays idea: “If a supervision fee is now suddenly up for debate towards the end of the DSA negotiation, the previously planned supervision structure should also be reconsidered and a specialized, independent EU platform supervision considered instead.” If supervision is financially dependent on the companies, independence must be guaranteed even more strongly.
At the latest, if not only the Commission for its responsibilities, but also the member states were to partially refinance their DSA supervision via supervisory fees, an effect already known from the GDPR could otherwise occur: a kind of non-regulatory competition of the member state supervisory authorities. This is because companies could relocate their headquarters in Europe at any time if the supervision does not suit them. One way to get around the problem is suggested by Julian Jaursch: “If the EU really wanted to innovate, it would not only make large platforms contribute to the costs of EU supervision, but set up an independent fund with a possible fee.”
While the DMA has already been negotiated, with the Commission to counter the largest players with about 80 posts, the issue could play a greater role again today in the fourth DSA trilogue. However, the plea for a corresponding regulation on the part of the Commission has come rather late, according to parliamentary circles. However, it is primarily the member states and the Commission that want to adopt the DSA as quickly as possible. In the case of the AI Regulation, on the other hand, there is still plenty of time to debate the design and load distribution, despite all the haste.
The Green MEPs in the ECON and ENVI Committees and those of the S&D Group in the ECON Committee have officially objected to the Complementary Delegated Act on EU taxonomy. The deadline for opening the objection procedure ended yesterday at 5 p.m.
The classification of nuclear energy and natural gas as sustainable could have entered into force automatically if no objections had been raised in Parliament or the Council. With the objection of the two groups, the procedure for Parliament to vote on the delegated act at a later date has been formally initiated.
The parliamentarians now have until May 30 to submit an opposition resolution, which can also be supported by members of other parliamentary groups. The Greens have announced that they will draft a resolution that will be supported by a broad cross-party alliance.
Rasmus Andresen, a Green member of the ECON Committee, announced that this step would be backed up by sound arguments. “In this way, we want to convince conservative and liberal parliamentarians to vote against the taxonomy as well. In Parliament, criticism of von der Leyen’s proposal is becoming noticeably louder,” Andresen explained.
The S&D Group coordinators will decide on a joint resolution justifying the objection at the end of next week. The vote on the objection resolution in the joint ENVI/ECON committee is scheduled to take place in June, before the plenary votes in July. An absolute majority, which is needed to approve the objection, requires 353 votes. If this is not achieved and there are no objections from the Council either, the delegated act will become legally binding. luk
The Kremlin indicated on Wednesday that all of Russia’s energy and commodity exports could be priced in rubles, toughening President Vladimir Putin’s attempt to make the West feel the pain of the sanctions it imposed for the invasion of Ukraine.
“If you want gas, find rubles,” Volodin said in a post on Telegram. “Moreover, it would be right – where it is beneficial for our country – to widen the list of export products priced in rubles to include: fertilizer, grain, food oil, oil, coal, metals, timber etc.”
With Russia’s economy facing its gravest crisis since the 1991 collapse of the Soviet Union, Putin on March 23 hit back at the West, ordering that Russian gas exports should be paid for in rubles.
In the strongest signal yet that Russia could be preparing an even tougher response to the West’s sanctions, Russia’s top lawmaker suggested on Wednesday that almost Russia’s entire energy and commodity exports could soon be priced in rubles. Asked about the comments by parliament speaker Vyacheslav Volodin, Kremlin spokesman Dmitry Peskov said: “This is an idea that should definitely be worked on. It may well be worked out.” rtr
Russian gas company Gazprom’s offices were raided by EU antitrust regulators, a person familiar with the matter said on Wednesday, as the EU watchdog ramped up its investigation into the company’s gas supplies to Europe. The person declined to provide details of the EU raids.
EU antitrust chief Margrethe Vestager in January asked gas companies including Gazprom about tight supplies after accusations the Russian giant was withholding extra production that could be released to lower rising prices. Vestager was likely to intensify information gathering on Gazprom’s European businesses, a person familiar with the regulator’s thinking told Reuters last month.
The European Commission declined to comment, and Gazprom Export also declined to comment. Bloomberg was the first to report the raids in Gazprom’s offices in Germany. Gazprom and the Kremlin have repeatedly denied withholding gas supplies, saying that all firm and long-term obligations have been met. rtr
European companies are to be given better access to public contracts and procurement procedures in non-EU countries in the future. This is to be made possible by the International Procurement Instrument (IPI).
On Wednesday, the EU member states in the Permanent Representatives Committee approved the agreement reached between the European Parliament and the Council of the EU on the corresponding proposal for a regulation, the Federal Ministry for Economic Affairs and Climate Action announced in a statement on Wednesday. The instrument thus clears a crucial hurdle after around ten years of negotiations since the publication of the first Commission proposal.
Sven Giegold, State Secretary at the German Federal Ministry for Economic Affairs and Climate Action, said the EU wants “transparent and non-discriminatory procurement procedures”. The goal of the IPI is to open up procurement markets in states outside the EU to European companies and to enable fair access to procurement procedures in non-EU countries.
In the future, bids submitted by companies from countries outside the EU that do not make their procurement market sufficiently accessible to European bidders may be deliberately disadvantaged or even excluded during bid evaluation in procurement procedures throughout the EU.
This is intended to increase the willingness of third countries to open their procurement markets to EU companies – for example, by joining the WTO Government Procurement Agreement (GPA) or concluding bilateral market access agreements. The proposal still requires the formal approval of the European Parliament and the Council before it enters into force.
Lufthansa and other airlines in an air cargo cartel have finally failed with their lawsuits against a fine decision by the EU Commission. Fines against Air France, KLM, and others would be upheld and the lawsuits rejected, the EU court announced Wednesday.
Lufthansa and two of its subsidiaries had been exempted from the fine in the EU Commission’s first decision in 2010 because they had disclosed the cartel as key witnesses. Nevertheless, Lufthansa, together with the other airlines, had fought the decision of the competition authority in court. Air France and KLM together have to pay the highest fines, about €300 million. Originally, the EU Commission imposed €790 million in fines on all parties involved.
A dozen cargo airlines colluded on prices between 1999 and 2006. British Airways, SAS, Japan Airlines, and Cathay Pacific Airways were also involved. The companies successfully challenged the EU’s first fine decision in 2010.
The EU court overturned it in 2015 due to “inherent contradictions”. The competition authority imposed the fine again in 2017 with improved justification, but all companies appealed again. For some airlines, the court now reduced the fines, in part because the EU authority violated statutes of limitations. rtr
The United States recently announced an immediate ban on imports of Russian oil and gas, while the United Kingdom and the European Union pledged to curb them more gradually. The rationale is clear: punish Russia, reduce its leverage, and restore peace to Ukraine. But wrong choices now – specifically, continuing to favor fossil fuels over renewable energy – could lock in a far less peaceful future.
Some Western countries have let themselves become overly reliant on Russian oil and gas in recent years, so the decision to cut back was not easy. But the bigger, tougher decision facing Western governments is how to reduce their overall dependence on fossil fuels. Simply replacing one dirty energy source with another would leave the growing dangers of climate change to be dealt with later – if at all.
Given the pressure of the current Ukraine crisis, such shortsightedness would be understandable. Western governments must close the energy gap created by stopping Russian fossil-fuel imports, while minimizing the damage to national economies. For now, they have the public with them. But if energy costs rise too high, or shortages become too disruptive, the resulting economic havoc could erode public support
Any alternative energy sources must therefore come onstream quickly and provide affordable, reliable supplies. And they should not create new geopolitical entanglements that might cause problems later.
At the recent annual CERAWeek energy conference in Houston, Texas, Big Oil CEOs and their lobbyists were quick to propose boosting oil and gas production, removing output caps, easing regulations, and reversing policies aimed at lowering carbon dioxide emissions. Several energy analysts and economists have echoed this line.
But with climate change fast becoming a leading driver of insecurity worldwide, doubling down on fossil fuels would be a tragic mistake – a choice that could make the world a more violent place in the coming decades.
The 2021 Production Gap Report highlighted the disconnect between current fossil-fuel production plans and climate pledges. Under current policies, global warming is on track to reach a catastrophic 2.7° Celsius this century. We need to be rapidly closing down wells and mines and shrinking production, not adding more capacity.
Climate change is already making the world more dangerous and less stable. The latest report from the Intergovernmental Panel on Climate Change (IPCC) – dubbed “an atlas of human suffering” by United Nations Secretary-General António Guterres – offered a stark assessment of the huge economic and human costs of even the early effects of climate change that we are experiencing now. It paints a picture of a future that we must avoid.
A survey of headlines over the past 12 months reveals record floods, storms, wildfires, heat waves, and droughts. All of these weather events are becoming more frequent, extreme, and deadly as a result of climate change, and all of them can increase the likelihood of conflict and instability. Today, 80% of UN peacekeepers are deployed in countries regarded as most exposed to climate change. Likewise, a recent study found that a 1°C increase in temperature was associated with a 54% increase in the frequency of conflicts in parts of Africa where nomadic herders and sedentary farmers compete for dwindling supplies of water and fertile land.
As the IPCC report rightly points out, the consequences of climate change most quickly destabilize places where tensions are already high and government structures are already weakened or corrupt. As research for the forthcoming Stockholm International Peace Research Institute (SIPRI) Environment of Peace report shows, armed extremist groups like al-Shabaab, the Islamic State, and Boko Haram have thrived in regions that are suffering the worst effects of climate change. They find recruits and supporters among people whose lives and livelihoods have become increasingly precarious because of floods and droughts.
In our globalized, networked world, the repercussions of local climate impacts can quickly spread, through supply-chain shocks, spillover conflicts, and mass migrations. And, as Russia’s invasion of Ukraine has demonstrated, the rules-based order is alarmingly fragile, leaving ordinary people to face the terrible consequences.
The West’s rejection of Russian oil and gas creates an opportunity to accelerate the transition away from fossil fuels. Energy efficiencies and other demand reductions can do part of the job. As for the rest, renewable alternatives like solar and wind power make economic sense. They are far quicker and safer to install than nuclear plants or most of the fossil-fuel alternatives being discussed. And they don’t expose people to the spikes and dips of global fuel markets.
The logic points in only one direction. The world will achieve true energy security – and have a chance of building a more peaceful, livable, and affordable future – only if we leave fossil fuels behind.
The authors are all members of the expert panel advising the Environment of Peace initiative at SIPRI.
In cooperation with Project Syndicate, 2022.