The idea of rationing proposed by the European Commission (EC, executive body of the EU) would lead to limiting the heating of certain buildings, postponing the closure of nuclear power plants and encouraging companies to reduce their needs.
The States must detail their roadmaps to achieve this objective before the end of September. Some, like Finland and the Netherlands, have already achieved this goal. Spain was the first country to express its opposition to the project.
Rejection
Meanwhile, in a context of maximum inflation in four decades due to rising energy costs and a looming recession, the organization representing European business warned yesterday that any decision to curb economic activity to reduce the use of Russian gas would have “disastrous effects”.
“Forced production cuts would have disastrous, and often irreversible, effects on businesses,” said Markus Beyrer, CEO of Business Europe. “It should be considered only as an option of last resort,” he added in a brief statement.
The disruptions so far have hampered the EU’s efforts to fill its gas tanks ahead of winter, raising the risk of de facto rationing and another setback to the bloc’s fragile economic growth. The situation would worsen if Moscow tightens supplies further in retaliation for Western sanctions over the war in Ukraine.
Germany is the country most dependent on the resource. According to forecasts by the International Monetary Fund (IMF) published yesterday, an interruption in the supply of Russian gas would reduce Germany’s GDP by 1.5% this year, by 2.7% next year and by 0.4% in 2024.
Goal
The EC specifically proposed a voluntary compliance target for all bloc states to reduce gas use by 15% between August and March, compared to their average consumption in the same period from 2016 to 2021.
“Russia is blackmailing us. Russia is using energy as a weapon. And therefore, in any case, whether it is a partial, important cut of Russian gas, or a total cut, Europe has to be prepared”, said the president of the Commission, Ursula von der Leyen.
The proposal would allow Brussels to make the cut mandatory in the event of a supply emergency.
The measure, which needs the backing of EU member states, will be debated on Friday so that ministers can approve it at an emergency meeting on July 26.
“We believe a full disruption is likely and is especially likely if we fail to act and make ourselves vulnerable to it,” an EU official said. “If we wait, the gas will be more expensive and it will mean that we will dance to the tune of Russia.”
Challenge
EU countries are trying to ensure their storage facilities are 80% full by November 1, up from 65% today, according to official data.
European politicians have accused Russia of playing politics with its gas supplies, using technical issues as a pretext to cut deliveries. The Kremlin said Russia remains a reliable energy supplier and blamed the supply cut on sanctions.
Two Russian sources familiar with Russia’s export plans said gas flows through Nord Stream 1 are expected to resume today. However, the Russian sources said that the supply will be below its capacity of 160 million cubic meters per day.
Kremlin-controlled energy giant Gazprom cut gas exports via the route to 40% of capacity in June, blaming delays in the return of a turbine Siemens Energy was overhauling in Canada.
Source: Ambito
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