The EU has agreed to cut its gas consumption by 15% in a bid to avert a winter crisis caused by a sharp reduction or total shutdown of Russian gas supplies to the bloc.
What has been agreed?
From next month until the end of March 2023, all EU member states will strive to achieve a voluntary 15% reduction in gas consumption. In the event of a major supply shock (a complete shutdown of Russian gas), the EU can declare an emergency and make the target mandatory with immediate effect.
Three island countries that are not connected to the EU gas network – Cyprus, Ireland and Malta – would be exempt from mandatory energy savings.
But almost all member states, especially those with little connection to the gas grid, or those facing an electricity supply shock, would have the right to request a deactivation.
How would it work?
EU governments can choose how to ration gas, as long as they protect the supply to households.
Industrial users will feel the pinch first; factories could have targets to reduce heating and cooling. Some could be spared, such as manufacturers of critical goods or plants that are difficult to restart after a power outage.
While consumers are protected, they are expected to do their part. EU authorities are urging governments to launch campaigns to encourage people to switch off lights and turn off thermostats and air conditioning.
EU governments are being urged to accelerate the shift to renewable energy, but are also being asked to consider delaying their exit from nuclear or coal power, an effort to find any alternative to Russian gas.
Member states must report to EU authorities in Brussels on their energy saving plan every two months, a form of peer pressure aimed at getting them to take action.
Why is the EU doing this now?
As the EU was in the final stages of negotiating the plan, Gazprom announced that a drastic cut in supplies through the crucial Nord Stream 1 pipeline would take effect on Wednesday. The timing was coincidental, but underlines why the E.U. is pushing to reduce the use of Russian gas.
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Since the Russian invasion of Ukraine, the EU has decided to phase out Russian fossil fuels, which are the main sources of funding for the Kremlin’s war effort.
For many EU member states, ending the use of Russian gas will be painful. Before the invasion, Russia supplied 40% of the EU’s gas and 55% of Germany’s, although Europe’s largest economy has since reduced its dependence.
How is the blog divided on the topic?
EU member states have very different energy mixes: some countries rely almost 100% on Russian gas, while others used none at all.
Countries that needed little or no Russian energy objected to making sacrifices for those that benefited from years of cheap fuel from their eastern neighbor.
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Spain and Portugal, which have little connection to the EU gas network, argued that the overall target of 15% was unfair. In the end, all countries in the bloc backed the plan with the exception of Hungary, where the government is a longtime Kremlin ally that reluctantly supports EU sanctions.
France, Luxembourg and the Netherlands supported the original plan, fearing the economic effects of a recession in the German economy.
How much energy will be saved?
If the EU reduces gas consumption by 15%, it would avoid using 45 billion cubic meters of fuel, according to estimates by the European Commission. Various exemptions reduce that total, but officials say that even if countries made the most of the exemptions, the plan would still see the EU through a moderately cold winter.
The 15% target, however, was designed to get the EU through a very cold winter. Expect long-term weather reports to be as thoroughly scrutinized as EU economic forecasts.
what happens next
The 2022-23 winter is expected to be difficult, especially if temperatures drop. But some fear that next winter could be even worse. EU gas storage levels are at 66% but could be seriously depleted by the end of next spring with fewer options to replace stocks.
EU officials suggest the gap could be filled by pipelines from Norway and Azerbaijan, more liquefied natural gas delivered by tanker from as far away as the US and efforts to reduce demand.
The original gas saving plan was to last for two years, but EU governments reduced the scope to one year. The plan for the winter of 2023-24 has yet to be written.