The spirit of the EU 2020 energy strategy seems to be well underway. The EU is planning to streamline the practice of deal making in the energy sector between EU members and outside parties and fortify the voice of Brussels. This sounds difficult, as the EU is home to half a billion consumers and about 20 million companies in 27 states and imports 80 percent of its oil and 60 percent of its gas requirements, mostly through bilateral trades and through the divine rule of big oil
EU commissioner for Energy, Gunther Oettinger has emphasized the need for the EU to ‘improve internal coordination to act together and speak with one voice’ on a global level. This will include proposals that are viewed under what constitutes the best interests of EU regional policy through approval from Brussels, stricter regulations on transparency and closer inspection on negotiations with the outside countries.
This new proposal is targeted directly on balancing the energy security debate between the EU and its Eastern partners, namely Russia, Turkmenistan and Azerbaijan. At the heart of the issue is the Nabucco southern tier pipeline, which is something of a hot potato currently. On one hand, individual member states are naturally reticent to allow for more centralization in their energy policy dealings, especially with the current confusion over Libyan oil and the strength of the big multi-nationals in the larger member countries. Whilst on the other, third countries such as Russia have often been able to eke out attractive deals with individual countries effectively undermining Brussels directives.
Politically and economically, this makes a lot of sense, centralization would mean a more secure energy supply, higher standardized safety processes and should insulate the sector against shock spikes and supply troubles. However this would require interdependence on an unprecedented scale in a sector renowned for individual interests.
The proposal for more centralized power is an interesting one. It is an attempt to marry the stringent recommendations of the 7th European Action Programme and the Energy 2020 targets with the consolidation of lucrative energy supplies and prudent investment. If it is put into practice, it will shore up the European energy sector, no undercutting, no shirking of responsibility on pressing security concerns, yet it will also require a skillful balancing act between vested business interests and more attractive markets popping up elsewhere.
