Striving for Sufficiency

By Dong Yifan

In the U.S. National Defense Authorization Act for fiscal year 2020 passed on December 20， 2019， a document titled Protecting Europes Energy Security authorizes the U.S. president to impose sanctions on foreign persons or entities who knowingly sell， lease or provide vessels for the construction of the Nord Stream 2 natural gas pipeline from Russia to Germany， and demands all involved to stop construction in compliance.

This unilateral move brings the European Unions （EU） energy supply and security into the spotlight. The U.S. argues that the project will increase Russias ability to supply natural gas to the EU， which will increase EU dependence on Russia and jeopardize its energy security. But in reality， the EUs basic strategy for maintaining energy security is to increase the level of diversifi cation of energy supply to share risks， and the Nord Stream 2 and related energy policies and plans are part of this approach.

No interference

The EU needs to keep close energy cooperation with Russia since natural gas has lower carbon emissions than oil or coal. Gas-fired heating can also help the smooth operation of renewable energy. Therefore， the EU is firm in resisting U.S. interference in its energy policy.

German Foreign Minister Heiko Maas lambasted U.S. interference and extrater- ritorial sanctions， saying that “decisions on European energy policy are taken in Europe.”Germanys Finance Minister Olaf Scholz also rejected the sanctions and said they “are a serious interference in the internal affairs of Germany and Europe and their sovereignty.”In addition， an EU spokesperson criticized“the imposition of sanctions against EU companies conducting legitimate business.”

However， Italys Saipem and Switzerlands Allseas， two contractors involved in Nord Stream 2， halted construction in compliance with U.S. sanctions. Nevertheless， Russia is determined to complete the project. According to Russias energy minister， Gazproms pipe-laying vessel Akademik Cherskiy， which is currently in the Russian Far East， could be used to fi nish Nord Stream 2 construction. For her part， German Chancellor Angela Merkel is looking for talks and consultations with the U.S. to resolve this sensitive issue. Although the project may be delayed for months or even a year， the EU and Russia cannot bow to U.S. pressure.

The Nord Stream 2 project is not trying to marginalize Ukraines status as an energy transit hub， as the U.S. has claimed. In December 2019， the EU and Ukraine reached a five-year gas transit agreement， which stipulates that at least 65 billion cubic meters of gas will pass through Ukraine in 2020， and 40 billion cubic meters each year from 2021 to 2024. This agreement reflected the EUs desire to maintain a multichannel supply of natural gas and Ukraines traditional role. It is an extension of the EUs strategic thinking on energy diversifi cation and goodwill between the EU and Russia to resolve the Ukrainian crisis.

Diversification efforts

Lacking natural gas and oil resources， the EU has to expand cooperation with other coun- tries to secure supplies. At the same time， it encourages the development of renewable resources to replace fossil fuels to combat climate change， which is also an important part of its energy diversifi cation efforts.

In 2015， the European Commission （EC） released A Framework Strategy for a Resilient Energy Union With a Forward-Looking Climate Change Policy， which put forward objectives such as enhancing energy security， boosting economic competitiveness， expanding the EUs voice in the energy market and becoming a global leader in climate change.

Beginning in 2013， relations between Western countries and Russia， an important energy supplier， were strained during the Ukraine crisis. The EU feared it would lead to turbulence in bilateral energy cooperation and even repeat disruptions of gas supply which occurred in 2006 and 2009. For this reason， it proposed diversifying fossil fuel supply and promoting the development of renewable resources to deal with possible energy crises.

The EU engaged in energy diplomacy with countries in the Middle East， Africa and Central Asia. It also strengthened liquefied natural gas （LNG）-related infrastructure construction as a supplement to traditional natural gas pipeline supply. In 2017， the EUs LNG imports were 52.3 billion cubic meters， up 13 percent. In July 2018， during a visit by EC President Jean-Claude Juncker to the U.S.， the EU and the U.S. signed agreements to expand imports of U.S. gas.

Thus， the EU has successfully diversifi ed its oil and gas imports. In 2018， the EU imported 40.5 percent of its gas from Russia， 35.1 percent from Norway， 11.2 percent from Algeria， 5.4 percent from Qatar， and 3 percent from Nigeria. In terms of oil imports， 27.3 percent came from Russia， 11.2 percent from Norway， 8.1 percent from Nigeria， 7.8 percent from Kazakhstan， 6.9 percent from Iraq， and 6.6 percent from Saudi Arabia.

Nord Stream 2 is an important part of the EUs energy diversification efforts. In 2011， the original Nord Stream pipeline， jointly built by Russia and Germany， started to transport natural gas passing through the seabed of the Gulf of Finland and the Baltic Sea. It supplied 55 billion cubic meters from Russia to the EU every year， which is 33.7 percent of Russias gas supply to the EU.

In 2018， Nord Stream 2 started construction to expand gas transportation to 110 billion cubic meters and diversify channels. Russian gas transported to the EU through pipelines that pass through Ukraine and Belarus is expensive， takes too long and faces political and economic risks due to uncertainties in the countries along the routes. The EU has therefore been committed to building a pipeline connecting Russia and it directly to save costs and improve reliability. When the U.S. sanctions bill was passed， 93 percent of Nord Stream 2 had been completed， with the remaining pipeline length just 160 km.

Renewable energy

The EU has also steadily advocated research into the application of renewable energy to replace fossil fuels. In its framework strategy， it emphasized the development of renewable energy and proposed to increase research， development and marketing support in areas such as batteries， energy storage equipment and electronic devices. It also stressed the application of energysaving and effi cient technology.

In November 2018， the EU proposed a climate neutrality deal， aiming to slash carbon emissions by 80 percent by 2050. The deal initiated reduction goals and methods for industry， agriculture， construction and other sectors， and proposed an increase in the commercialization of scientifi c and technological achievements.

After taking offi ce in December 2019， new EC President Ursula von der Leyen proposed an EU green deal， raising the reduction goal for 2030 from 50 to 55 percent and striving to reach carbon neutrality by 2050. According to the new plan， application of renewable technologies such as wind power and intelligent electricity networks will be expanded， while a digital EU energy market featuring connectivity and integration is expected to take shape. The EU will also work to construct intelligent and low-carbon emission transportation to promote green and decarbonized energy consumption in the transport area.

Although the EUs renewable energy policy is dominated by the development of emerging industries and a response to climate change， diversification of energy resources is still a major component. The EU has made great progress in replacing fossil fuels with renewable energy， while at the same time its oil consumption has dropped from a peak of 725 million tons in 2006 to 624 million tons in 2018. The share of renewable energy， excluding hydropower， in energy consumption rose from 3 percent in 2005 to 11 percent in 2017.

The EU will continue to promote energy diversifi cation and maintain its energy security and energy interests rather than surrender its autonomy under U.S. sanctions or pressure.