Energy Supply

Within a few years unconventional gas, in particular shale gas, discoveries in the USA, have changed the geopolitics of energy.

The USA is becoming one the major gas producers on earth, shaking off its dependence on the unstable Gulf region.

Gas prices have dramatically gone down in the USA, enabling the country to re-vitalise energy-intensive industries and creating hundreds of thousands of new jobs in the States of the Middle West.

Throughout the world oil and gas companies are taking claims for potential reserves, from UK to Poland, China and Australia.

Unconventional gas deposits are widely spread around the globe, reducing the fears about excessive dependence on the Middle East, Russia or Central Asia for future oil and gas supply.

Reserves of conventional and unconventional gas that are technically recoverable might last 250 years on the basis of present gas consumption (IEA), which would turn gas into a fossil energy with very long life-expectancy, comparable to coal, revolutionising the long-term energy outlook. Gas might supply one quarter of global primary energy needs by 2025 and 40 per cent by 2040!

These prospects are bound to have a climate bearing, as green house gas emissions from gas are only two thirds of those from oil and less than half of those from coal.

The significant decline of US emissions since 2005, the first ever registered, is largely due to the switch from coal to gas in power generation.

Sooner or later governments and international oil/gas business will follow the American example and invest massively in unconventional gas, replacing coal as the major input for electricity generation.

Humanity might thus buy a respite of several decades in the fight against climate change. Gas, whatever its form, will be a cheap and convenient alternative to wind, solar and bio-fuels, difficult to resist.

Of course, unconventional gas is no miracle solution

• It is fossil energy emitting green house gas, even if emissions are relatively lower than from competing fossil sources, though higher than from conventional gas, due to its higher methane content.
• It requires large quantities of water, blended with chemicals, for fracturing gas-bearing rocks. Arid or densely populated regions are therefore not suitable for production of unconventional gas. The risk of water contamination can, however, be resolved by appropriate technologies; The volume of water consumption should not be exaggerated either. According to UK estimates, it represents no more than 10 per cent of water losses from pipe leakages.
• Last not least, it is more expensive than conventional natural gas. But with rising energy prices this will matter and less.

Several European countries – Poland, UK, France, Germany and Italy- hold large quantities of unconventional gas. European gas reserves are estimated to increase 1000 fold! EU dependence on Russian gas imports might dramatically decrease.

Public opposition against exploration and production remains strong and has led the French government to decree a moratoium. But UK and Poland are actively preparing for the new era.

The EU has so far abstained from taking a clear position on how to deal with unconventional gas.

Potential producers will, of course, have to comply with EU and national environmental regulations on water, noise etc.

Lacking the free space of the USA on-shore production will also be limited to areas with low population density.

 

Whatever individual member states may decide, the U should not be deceived by exuberant expectations and proceed guardedly. There is no need to rush, let alone panic because of excessively low gas prices in the USA, which will be a temporary phenomenon.

For Humanity, the biggest challenge will be excessive complacency and ignoring climate change over the relief of disposing a new source of low emission fossil fuel.

Resorting to unconventional gas is fine as long as we use it as a “bridge fuel” to a low a emission global energy system which must remain the overriding objective.

Reducing energy consumption through higher efficiency and promoting wind and solar energy should therefore enjoy priority over a reckless expansion of unconventional gas production.

Eberhard Rhein, Brussels

The Risk-Monger attended an event in Brussels on proposals for EU shale gas regulation. He was expecting to sit back and enjoy some serious stakeholder mud wrestling. But it seemed like nobody really cared except for the small anti-shale environmental groups. This lobbyist vacuum frightened the Risk-Monger.

At a special press briefing organized by The International Press Association in Brussels last week, EU Energy Commissioner Günther Oettinger confirmed that he will be bringing forward proposals for post-2020 policy, before the current term of the Commission ends, which is 31 October 2014. He said that the Council would talk about binding targets in an orientation debate and that he favoured binding targets. He also said that the targets will be “pragmatic” and “sensitive”.

For 2020, the EU has committed to cutting its emissions to 20% below 1990 levels, as well as renewable energy and energy efficiency targets. A binding renewable energy target for 2030 would provide much needed confidence for the renewables industry, as well as secure commitment to tackle climate change from EU member states.

Oettinger was asked about the implications of the recently agreed EU budget for 2014-2020 on energy. He said “in the past, we developed energy policy without funding”…“In the past MFF, there was zero for infrastructure”. Now, the 2014-2020 Multiannual Financial Framework has proposed €5bn for co-financing of projects of cross-European interests, such as electricity interconnectors, instead of the €9bn proposed by the Commission. Even so, this will result in a “complete pan-European infrastructure”, said the Commissioner. With the new Multi-Annual Framework budget  “we have the financial resources to contribute and be a fair partner”. Oettinger also emphasised the need for private investment in EU energy projects, and smart instruments being devised by the European Investment Bank with the Commission with which “we can get much more than €5bn”.

Read more on the EWEA blog.

The Risk-Monger tries to show how wind turbines are profane and vulgar, encouraging ecological exploitation in much the same way as a prostitute on a street corner affects our assessment of worth. Warning: Reading this blog might influence how you look at wind turbines in future.

North Dakota, the emerging US shale gas/oil paradise, and northern German wind energy regions are learning similar lessons: Both produce more new energies than they are able to sell, due to inadequate pipeline and grid systems.

The consequence is a waste of energy, through gas flaring in North Dakota and temporary over-supply of wind and solar power in Germany.

In both cases, market exaggerations and/or excessive production incentives are responsible for the mismatch.

• In North Dakota, the rapid development of shale gas operations by far exceeded the regional demand; and the subsequent price slump made the construction of gas pipelines to distant consumption centres economically uninteresting. Flaring of surplus gas became therefore a necessity.
• In Northern Germany, attractive feed-in tariffs and purchase guarantees by grid operators led to increasing over-supply due to insufficient grid capacity unable to transport the wind electricity to the consumption centres in southern Germany.

From a climate perspective, the US dilemma is much worse than the German one: flare gas is burning continuously and it contains methane, which is more dangerous for the atmosphere than C02. In the case of Germany, old coal or gas power plants have to be temporarily re-activated leading to short-term increases of C02 emissions.

The lesson to be drawn should be the same in both cases:

When introducing new energy systems policy makers should pay more attention to a balanced development between production and consumption. They should have foreseen that North Dakota and Northern Germany would need to ship most their increasing gas or electricity output to distant consumption centres and given appropriate directives for creating the transport infrastructure.

It will, however, take several years before the necessary pipelines or grids can be installed. A more radical short-term response would be a moratorium during which investors would abstain from completing new production facilities. But for legal reasons that is more easily said than done.

Society will thus have to put up with the consequences of imperfect investment choices, as it has to permanently.

Brussels 29.01.2013 Eberhard Rhein

The mammoth US economy is sputtering along. Its fiscal and monetary imbalances while not yet as acute as Greece’s, are unsustainable. But America is not Greece. An anemic US economy is a drag on world growth. Another crash would be catastrophic.

With the ballyhooed New Year’s Day fiscal-cliff deal, pundits and Wall Street breathed a sigh of relief. However, while it eased uncertainty, the deal wasn’t pro-growth and didn’t even put an installment on solving America’s pressing fiscal issues.

Lurching into 2013 America remains mired in the economic doldrums, with unsustainable trillion-dollar-plus deficits as far as the eye can see, improving but lackluster GDP growth, and a December 58.6% employment-to-civilian-population ratio stuck stubbornly near its thirty-year low. While US population increased 11.4 million since November, 2007, soberingly, there are 3.3 million fewer jobs.

Human action determines economic growth. Decisions to work an hour more, invest, start a business, hire, or go on the dole, are driven by incentives. The average 5th grader but not necessarily Washington mandarins understands you get more of what’s rewarded and less of what’s punished.

Medieval English friar and philosopher William of Ockham posited when trying to understand phenomena the hypothesis requiring the fewest assumptions was preferred. The test came to be known as Occam’s razor. Applying it to predicting President Obama and Senate Majority Leader Reid’s positions, they are consistently on the side of the issue putting a damper on growth, diminishing economic freedom and increasing the state’s role.

Thirteen fiscal-cliff-deal and Obamacare tax increases batter America effective New Year’s Day, including: (1) a 48% increase in the 4.2% payroll tax in place since 2011, (2) for high-income earners marginal income-tax rates rising from 35% to 39.6%, capital gains and dividends taxes from 15% to 20%, a 3.8% surtax on investment income, and a .9% hike in the hospital-insurance portion of the payroll tax, (3) boosting the death tax from 35% to 40%, and (4) a 2.3% excise tax on medical devices, all of which suppress growth.

The deal also provides billions of dollars of tax-credit subsidies for political cronies including rum producers, Nascar track owners, Hollywood and
fashionable but uneconomic bio and algae-based fuels and wind-power, indirectly rewarding rent seekers such as GE and Siemens.

It extended yet again unemployment insurance. When unemployed receive benefits for almost 2 years it’s European-long-term dependency, not insurance, sapping initiative and prolonging unemployment.

Since 1870 US-production growth averaged 3% annually. From 1981 through 2008, real-US-GDP growth averaged 3%. Under Presidents Reagan and Clinton annual-real-GDP growth averaged 3.54% and 3.88% respectively. The American way has been to grow the pie. From 1870 through 2010 real per capita income increased twelvefold.

Since 2007 however the US growth trajectory declined from its century plus trend.

After WW2 Europe was catching up to the US, but in the seventies with the advent of its massive welfare and regulatory state, growth stagnated. Nobel-prize winning economist Robert Lucas Jr. attributes this to Europe’s labor, welfare and tax policies and worries by embracing similar policies the US condemns itself to sclerotic, EuroSocialist growth.

Apologists for America’s economic malaise suggest tepid 2% growth or worse is the “new normal.” Excepting the Great Depression and Great Recession, the economy normally roars out of recessions, the deeper trough the more robust the recovery. The Reagan recovery crested at 7.2% real-GDP growth in 1984. After 2009’s 3.1% real-GDP decline, growth should have been well above average.
Senator Phil Gramm said America’s problem was too many people in the wagon and not enough pulling it. Nobody however, argues America doesn’t need or can’t afford a safety net. It ought to be easy to get on, but hard to stay on, and stigma should attach. Washington however turns this timeless wisdom on its head, encouraging individual and corporate welfare and punishing enterprise and wealth creation.

A whopping 47.5 million Americans receive food stamps, up 68% from 2008 and 176% from 2000. Houston, we have a problem. A record 8.8 million Americans collect disability. In the last four years disability recipients increased four times faster than new jobs. In a market where most employment opportunities are not stevedore or UFC-cage-fighting jobs, that suggests an increasingly loose notion of disabled.

Energy is a cost of everything consumed and produced. A fracking revolution on private land spurred a boom in US gas and oil production, heralding to the dismay of Energy Secretary Steve Chu pining for $10 dollar a gallon gas, the prospect of falling gas and electricity prices. International Energy Agency economist Fatih Birol forecasts the US will surpass Russia in 2015 and Saudi Arabia in 2017 as the world’s largest gas and oil producer respectively, assuming the EPA doesn’t put a kibosh on it.

The fracking miracle happened because of heroic entrepreneurs operating on private land and it wasn’t on anti-growth Greens’ radar. Tellingly, on Federal lands and offshore production has declined and new leases and permits have plummeted.

Obamacare generated a firestorm of protest. The president’s other landmark legislation the 2300-page Dodd-Frank Act is every bit as harmful crowding out the private sector. A healthy financial services sector allocating capital from savers to consumers and investors and providing payment services is vital for economic growth. Dodd-Frank converts financial services into a public utility, suppressing innovation and value creation.

The president, Treasury Secretary designee Jack Lew and Fed Chairman Bernanke continue supporting a reckless zero-interest-rate-weak-dollar policy. Money matters. It’s a store of value, a medium of exchange and unit of account. Interest rates – the price of present versus future investment and consumption, are the economy’s most important prices.

The Fed’s balance sheet mushroomed from $900 million in 2007 to $2.9 trillion, including $1.7 trillion in government securities partially monetizing the national debt. Bernanke’s $2 trillion haven’t ignited explosive inflation yet because in the current climate banks are sitting on record excess reserves. While popular with borrowers, keeping interest rates artificially low punishes savers, distorts consumption and investment decision making, and fuels the next bubble(s).
Growth improves Americans’ standard of living, and makes addressing the politically-difficult exploding deficit and entitlement crises easier. Robust US growth would be a shot of adrenaline for the global economy. Anemic growth is a choice America doesn’t need to make.

 

By Eberhard Rhein According to the IEA, global green house gas emissions will have to decline substantially – from close to 40 billion tons in 2012 to only 23 billion tons in 2030 – to prevent average temperatures on earth from soaring beyond the 2009 international target of +2°C. Such a decline is most unlikely to take place. In its global energy outlook 2010 -30, BP estimates that the 2030 global C02 emissions will be 27 per cent higher than in 2010.

The European Commission’s proposals to cut back on the biofuels section of its renewable energy policy is a wise move. In an atmosphere of undoubtedly increasing tension over global food security such policies operated without flexibility are inevitably going to be a political liability. To the politically simple-minded converting food and feed grains into motor fuel when a billion or more people are starving appears immoral. The fact that European and world agricultural industries are well able to absorb both the demand for biofuel use and for food is beside the point. Food availability is not the problem. Mass starvation can only be cured by the provision of cash – to move food from surplus to serious deficit areas.  But what matters is the apparent political unacceptability of the conversion of food crops into fuels. In reality the policy is both economic and environmental nonsense.  In terms of GHG emissions  and distortions of agricultural product and farm input markets,  maintaining inflexible EU and US  mandates for minimum levels of biofuel use is both environmentally and economically unsound. GHG emission reduction compared with fossil fuel use is minimal and subsidising farmers to convert maize, wheat, rapeseed oil  and palm oil into petrol and diesel will inevitably compete with food demand and raise prices unnecessarily when harvests are substandard. The use of imported vegetable oils for  biodiesel also raises unresolved questions on the indirect land use change (ILUC) issue. Inevitably, there has been pressure from both environmental and humanitarian NGOs on both Brussels and Washington to cut back their biofuels policies. The Commission has responded with a recommendation to limiting the use of food crop origin biofuel to 5% of the renewable energy requirement by 2020. This effectively means a halving of the original target, since almost all of any biofuel contribution during the next eight years is likely to come from what are essentially food crops. The bulk of the EU’s production of biofuel is biodiesel , produced from oilseed crops, both home grown and imported. A much smaller proportion comes from ethanol produced from cereals and sugar. It is probable that the Commission action was prompted by a number of analyses of the role of biofuels in the recent food price crises and also by work that has shown minimal environmental gain from their use. A recent study on the biofuels issue by the Institute for European Environment Policy (IEEP)  suggested  removal or reduction of the EU’s 10% target for renewable energy in transport; enforcement of  stricter sustainability standards, includingthe removal of subsidies for unsustainable biofuels and/or the promotion of more sustainable biofuels and making biofuel mandates more flexible. The IEEP report not only confirms that the current dominance of biodiesel over ethanol in the European biofuel market will continue, but also that  first-generation biofuels produced from traditional food and feed crops would  continue to predominate , translating into a significant additional demand for these crops and contributing to increasing prices. It is worth bearing in mind that in the longer run the global energy market will take encouragement or otherwise of biofuel production out of the hands of governments.  As the oil price rises so biofuel production will became profitable in its own right,without the aid of government subsidies or market protection. <19/11/2012>

“Gazprom” and Bulgaria have concluded the definitive investment agreement about the “South stream”. The document became the last necessary condition for the full coordination of the project of the pipeline with countries-participants.

“Gazprom” has predictably overcome the last barriers to the construction in terms of diversification of natural gas export routes. For the realization of the overland part of the project the Russian monopolist has in its disposition the signed intergovernmental agreements with Bulgaria, Serbia, Hungary, Greece, Slovenia, Croatia and Austria. Ukraine can write down all these countries into the core group of failures of its foreign policy.

The declared project capacity of the sea site of the gas pipeline will make up 63 billion cubic meters per year. And the approximate cost of construction of the whole gas pipeline is estimated around 15,5 billion euro, out of which about 10 billion euro is earmarked for the sea site. As for today it is basically not important where such volumes of gas will appear from. The main point is whether they are necessary for Europe which has decided to head for the reduction of consumption of the Russian gas. The reality of international relations is first of all dictated by the economic benefit. In this context Russia and Europe show the mutual approach in relation to Ukraine.

The question is different. All listed above countries simply don’t perceive Ukraine as the state in the geopolitical sense. Probably, the Ministry for Foreign Affairs of Ukraine has another thought in this respect. However, it depends on the present authorities which thanks to the parliamentary elections have received another term for the confirmation of democracy in the country.

Meanwhile, as for today Russia has all economic levers of influence upon Ukraine. Europe, in turn, is sure that it will receive the minimum necessary volumes of Russian gas through the gas-transport system of Ukraine. The previous accusations in “winter” thefts of gas by Ukraine testify to the realization of the long-term strategy of forcing it out, as the energy player. The last trump of Ukraine – the gas-transport system – becomes not topical. This process was promoted by the mutual tacit consent of Russia and Europe upon the unilateral buying up of all internal gas distribution networks of Ukraine. After the end of this process Ukraine as the state is going to be excluded from the negotiating process between Europe and Russia. It is always easier to conduct negotiations with several pro-ruling groups which know how to count money. It is easier to buy their assets which have already gone through all legislative coordination.

And average Ukrainians, as always, are historically doomed to suffer from another increase of tariffs for energy carriers.

 

Intermittency of wind and solar energy are considered as major obstacles to the use of renewable energy: how to avoid power cuts during night or winter when there is neither wind nor sunshine?

• One answer are transnational grids, assuming that there will always be sunshine or wind in a broader geographical area. That is certainly correct, but fails to offer the 100 per cent security of supply that clients expect from their utilities.

• Another answer are gas power plants that can rapidly respond to power shortages . But investors do not like to build gas power stations that will lie idle most of the time.

• The most conventional response to the storage needs has been pump storage. That is definitely an economic answer; but the number of necessary power stations will by far exceed the physical potential when Europe will one day depend essentially on renewable sources.

• Power-to-gas installations may be offer the potential for the large scale and long-term storage needs of the future: they use surplus wind- or solar- generated electricity to splitting water into hydrogen and oxygen through hydrolysis.

  By combining these with carbon dioxide the installation produces methane that can be stored in depleted gas or salt caves and burnt in gas-fired power plants whenever needed in times of lull or darkness. A small 250 kW installation is presently being tested for its technical feasibility in Stuttgart. Others are due to follow next year.

Power conversion losses and storage costs will ultimately decide on the future of this storage technology.

For Germany with its objective of replacing nuclear electricity by energy efficiency and renewable sources until 2022 the rapid development of cost-efficient electricity storage will be crucial for the success of its “energy revolution”. It has therefore little choice but to be the front-runner, hoping to develop by the same token a new export technology.

 

Eberhard Rhein, Brussels

The strategic agreement between Rosneft and BP is mutually advantageous. Apart from considerable means, British receive stocks of the Russian oil monopolist and the guaranteed presence in the Russian market. And what’s most important, ВР gets access to the development of the Russian part of the Arctic shelf.

After the finalization of the agreement the head of Rosneft I.Sechin will receive the status of the generator of energy assets of Russia. Formally thanks to his efforts Russia has got another state oil monopolist of the Gazprom level. As the head of Rosneft and Rosneftegaz, he receives control over enormous monetary streams. The rates of privatization supported by the government will depend on him even more. It was foreseen earlier that a part of means of Rosneft would be directed at this initiative. It looks like terms, objects and parts of companies for the privatization will be changed. And the list of strategic energy enterprises can be refilled.

The consequences of the specified agreement will be tangible for Ukraine as well.

Firstly, the TNK-BP was an influential player in the Ukrainian market of oil products. Having changed the TNK-BP brand, Rosneft will be able to play with prices of oil products. Ukraine managed to diversify the majority of them. They were coming from the Baltic, Poland, Romania and Belarus. Using Rosneft, Russia will try to change the situation to its advantage.

Secondly, the monopoly right of Rosneft to the development of hydrocarbon deposits will entail the reorientation of the private Russian companies to the adjacent markets. The last initiatives of the heads of Gazprom and Rosneft on the prohibition of admission of these companies to the development of the Arctic shelf will strengthen this tendency even more. In Ukraine they will be interested in possible participation in the development of the Black Sea shelf. Rosneft can favor private Russian companies in this process. That is, control over their activity will spread on the projects connected with Ukraine as well.

Thirdly, Ukraine will receive additional political risks in relations with Russia. Advantages of Ukraine in case it joins the Customs Union can become more obvious. Especially, in terms of introduction of the preferential regime. From now on if necessary, Russia will be able to have an impact on the probable deficit of oil products in Ukraine even more. However, to gradually raise prices and receive super-profits is apparently more favorable, than to destabilize the situation.

 

The Polish government has a sad reputation for adopting unilateral, even obscure approaches when it comes to our country’s energy policy. What now came as a very disappointing surprise is that the Polish parliament joined the opportunistic chorus of denial – one that considers alternatives to the continued reliance on fossil fuels as a threat to Poland’s security.

posted on the Bankwatch blog by Kuba Gogolewski, Polish energy campaigner

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Last Friday, in an unanimous vote, the Polish parliament adopted a resolution which criticises the European Commission’s long term objectives for reducing greenhouse gas emissions and creating a low-carbon economy in Europe.

The resolution states that:

These proposals, contained in documents such as the Energy Roadmap 2050, do not consider the specific economic conditions of individual member states [...] (Propozycje te, zawarte w takich dokumentach jak Energy Roadmap 2050, nie uwzględniają specyficznych uwarunkowań gospodarczych poszczególnych krajów członkowskich [...])

… instead it calls for

[...] a comprehensive analysis of the costs and benefits associated with the implementation of climate policy. ([...] wzywa Radę Ministrów do przygotowania wszechstronnej analizy kosztów i korzyści związanych z realizacją polityki klimatycznej.)

This vote (and the fact that even the more progressive members of parliament voted in favour) is just another sign of how much Poland is detached from the rest of Europe – and from reality.

While countries such as Finland work on plans to phase-out coal generation by 2025 and Germany foresees a full decarbonisation of its electricity in 2050, Poland is still fighting wars with its perceived enemies, embodied now also by the European Commission. (And never mind that 26 countries have supported the Commission proposal.)

At the same time, Poland’s decision makers have not come up with a document that outlines their vision of an effective climate policy (a need that Friday’s Parliament resolution “recognises”). Instead they repeat a mantra that mingles the fear of economic stagnation with an imagined or at least grossly exaggerated threat to Poland’s energy security by external powers.

Many open questions, no answers

I think it is legitimate to ask my country’s representatives: What would a Polish “Roadmap 2050” look like? What is the place of renewables in Poland after 2020? How is Poland willing to address its growing dependence on oil coming predominantly from Russia? And what about the increased coal imports?

Poland’s Energy Policy 2030 (pdf) envisages over 65% of primary energy demand in 2030 coming from coal, lignite and oil. It does not include much development in renewable energy after 2020 – the renewable ratio of the final gross energy demand would increase by only one percent between 2020 and 2030.

What about energy efficiency, then? Will Poland exploit its still massive potential and thus reduce our energy and heating bills and our CO2 emissions?

Instead of answering these questions or consulting them with its citizens, Polish authorities are grumbling at the European Commission and are buying time to continue business as usual. (We have also heard Prime Minister Tusk on Friday, announcing more roads, more coal power plants and shale gas [PL].)

Poland’s long-term thinking seems to cover only considerations over how to get us through the next two difficult years when EU money will only come as a trickle.

More than one possible future

The sad thing is that understanding climate policy simply as a “burden” (as the Parliament’s resolution does) neglects the benefits that lie in green investments.

A study by the Central European University estimates that large-scale deep retrofitting of buildings would bring energy savings worth EUR 203 billion by 2080 and create 224 000 additional jobs.

In numerous places around Europe, Poland included, money from the EU Budget has been used fruitfully to implement projects that benefit both the environment and the economy. The next EU Budget (2014-2020) worth one trillion euros, a third of which will go to Cohesion Policy funds, could bring many more such investments, especially if – as planned by the Commission – at least 20 percent of this money is earmarked for low carbon spending.

Clearly, for Poland, low carbon comes with EU financial support and with economic benefits added to the environmental ones. It has been stated over and over again by the EU and by independent researches.

Alas, Polish decision makers are not willing to listen to civil society’s suggestions or proof. The state prefers to support research that is decidedly pro-fossil fuels, because the government has always known that there is only one possible future and that any discussion with the remaining 26 EU countries – or its own citizens – is useless. And now the Polish Parliament has backed this approach unanimously.

But questions over how to build a more sustainable energy sector must not just be ignored any longer.

The next time you see a Polish official criticising the European Commission’s Roadmap 2050 please do raise these issues with them. Ask them how their Roadmap looks like. Call the bluff.

The awarding today of the Nobel Prize for Peace to the EU is a great recognition of the most prominent peace-making system the world has seen. Europe has experienced the longest period of peace in its more than 2000 years of history. It is also ironic. The Nobel Prize Committee recognized the six decades of peace that should be celebrated this year as the institutions of the European Community began their work in 1952. But WHY did none of the European institutions themselves celebrate the 60 years and the 60th Anniversary!! The European Commission did not celebrate the sixty years of its entering in function in August 1952. The Council did not recognize or celebrate the sixtieth anniversary of its first session after the signature of the Europe’s first treaty coming into force. Nor did it celebrate the signature of the European Community Treaty of 18 April 1951! The European Parliament did not celebrate the first session of the democratic Assembly of the European Community under the presidency of Paul-Henri Spaak. Secondly, WHY has the EU not fully developed EURATOM, the European Atomic Energy Community — the means to create a powerful non-proliferation instrument that would prevent nuclear bomb technology turning the world into flames. Robert Schuman whose Proposal created the European Community the core of the present EU, said in 1949 that he was inspired by some aspect of the Nobel Dynamite trust to make sure that such powerful materials should not be misused. Explosive  material such as dynamite owed its existence to coal-tar chemistry. These explosives were far more powerful than gunpowder used up to the beginning of the First World War. Schuman’s first Community, the European Coal and Steel Community created Europe’s FIRST SINGLE MARKET in coal and steel products. This made the secret production of weapons of war ‘not only unthinkable but materially impossible‘. He provided the most democratic means to run the Community, but this requires that the politicians properly apply the treaties. For example the politicians still need to agree on having fair elections. Let us hope that the European institutions will now begin to examine their past histories and reverse the disastrous political decisions that reject Community principles.    

For its energy supply, Humanity depends presently more on the Gulf countries than on any other part of the earth: one third of global oil and one fifth of gas reserves lie there; and production costs are lower than anywhere else.

This situation will not be sustainable:

• The Gulf countries have to envisage a progressive depletion of their oil-gas reserves. In 50-100 years their reserves will come to an end, starting with oil. That may appear a long time, but the first oil crisis was only 40 years ago.
• They need to set aside rising proportions of their production to satisfy the needs of their growing population and expanding industries.
• Due to climate, life style and heavily subsidised prices, per capita consumption of oil/gas in the GCC is higher than anywhere than else.

In the past 50 years the Gulf countries have not made any efforts to reduce domestic oil and gas consumption. They had been too fixated on their huge mineral wealth and the accruing rents.

In the last few years, signs of change have appeared, starting in Abu Dhabi and more recently in Saudi Arabia:

• Governments have started establishing targets for the share of renewable energy in their supply, however modest or non-binding these may have been.
• Abu Dhabi has dared to step into nuclear energy. With the help of Korean know-how it will spend some $ 20 billion to build four nuclear reactors until 2020, designed to cover one quarter of its power needs, the remaining three quarters to be covered by solar, wind and gas.
• Saudi Arabia is following suit. In September 2012, it has announced an ambitious 20-year development plan covering nuclear, solar and wind energy.

By 2032, it aims to cover one third of its fast rising electricity needs from solar installations and another 15 per cent from wind, geothermal and nuclear sources. If fully implemented, Saudi Arabia will become the biggest renewable energy producer in the Middle East and one of the biggest globally.

These programmes can only be the beginning. The Gulf countries possess ideal opportunities for solar energy generation, both PV and solar-thermal. With proper storage facilities they would not require oil/gas or nuclear energy for satisfying their power demand.

Indeed, solar insulation is among the best on earth, both as to the intensity and availability around the year. They have more than plenty of unused land for building huge solar power plants across the peninsula. Technologies for protecting and cleaning the panels/mirrors against/from sandstorms should not be difficult to develop and install.

An ambitious solar/wind strategy, combined with low-energy buildings and strict standards for curtailing excessive energy and water consumption should enable the region to become the Mecca of energy-efficiency and low CO2 emissions, provided far-sighted rulers put an end to subsidised gasoline and electricity rates take a bet on renewable power.

Without a radical shift in their energy policy, making fossil energy a scarce and expensive resource, GCC governments will not succeed in reducing their domestic fossil energy consumption. This will sooner or later make them unable to satisfy both domestic and international demand for oil and gas.

Such perspectives would be extremely worrying for the EU, which will continue to depend on oil and gas imports for several more decades, whatever the success of its energy strategy.

The EU therefore has a vital interest in the success of the policy shift towards renewable energy that the Gulf countries are engaging in and should offer its full support and cooperation.

Ideally, the Gulf countries should

• establish long-term targets for the generation of solar and wind energy, with the aim of covering 80 per cent of their electricity consumption in 2050;
• elaborate a strategy for reducing their energy consumption. To this end, prices must at least be doubled over the next 10-15 years, with a consistent strategy of taxation, strict energy efficiency standards for lighting, air conditioning, automobiles, power plants and above all buildings.

The forthcoming 18th world climate conference (COP 18) early December 2012 in Qatar will be an opportunity for deepening the GCC- EU dialogue on their respective energy and climate policies. It is crucial to have the Gulf countries as allies for a far-sighted sustainable energy strategy at the global level.

Eberhard Rhein, Brussels

L’Europe prête à durcir les règles anticorruption pour les industries extractives ? Les Groupes miniers et pétroliers souvent accusés d’entretenir corruption et opacité financière dans les pays les plus pauvres mais riches en ressources naturelles et démocratiquement faibles, ont-ils  perdu une bataille, mardi 18 septembre, au Parlement européen. La Commission des affaires juridiques a adopté un projet d’avis, mais la commission n’est pas chef de file et la commission du marché intérieur a un poids  bien supérieur . Le débat sera animé. Dans la foulée d’une décision américaine passée relativement inaperçue dans le courant de l’été, les eurodéputés de la commission des affaires juridiques ont adopté un texte très contraignant, qui vise à améliorer la transparence des transactions financières dans les secteurs pétrolier et minier, notamment. Les Etats-Unis avaient tracé la voie qui devrait faciliter l’adoption définitive des nouvelles règles européennes. Le 22 août, la commission de surveillance des opérations boursières à New York, la SEC, a approuvé un règlement qui a force de loi. Attendu de longue date, il oblige dorénavant les compagnies pétrolières, gazières ou minières cotées à Wall Street à déclarer annuellement toute somme supérieure à 100 000 dollars (77 000 euros) versée pour un projet à un gouvernement, une autorité locale ou une entreprise publique du pays dans lequel elles extraient les ressources. Cette décision s’inscrit dans le cadre beaucoup plus large de la loi américaine dite “Dodd-Frank” adoptée en 2010 et destinée à réglementer le système bancaire et financier fortement ébranlé par la crise des subprimes. Les règlements de la SEC, combattus pendant deux ans par le puissant lobby pétrolier américain API, avaient, en revanche, été salués comme une avancée majeure par toute une coalition d’organisations de la société civile. Mardi 18 septembre les eurodéputés sont allés encore plus loin que la SEC au moins pour ce qui concerne le champ d’application. Le seuil retenu de 80 000 euros est globalement le même. “Ce montant n’est rien pour des compagnies de ce genre”, a expliqué Françoise Castex, eurodéputée française (PS) membre de la commission des affaires juridiques. En revanche, les eurodéputés ont élargi le champ d’application aux sociétés (cotées en Europe) présentes dans le BTP, les télécoms, les banques ou l’industrie du bois. Autant de “secteurs particulièrement opaques et qui génèrent des revenus importants en Afrique”, note Friederike Röder, de l’ONG ONE France, membre de la coalition internationale “Publiez ce que vous payez” qui se bat depuis dix ans pour que les revenus des industries extractives bénéficient aux populations concernées et pas seulement à l’enrichissement d’une petite élite locale. La publication de toutes ces informations “vise à faire la lumière sur les revenus générés par l’exploitation des ressources naturelles. [Elle permettra] à près de 1,5 milliard de personnes vivant dans l’extrême pauvreté dans les pays riches en ressources naturelles de demander des comptes à leur gouvernement”, se réjouissent, dans un communiqué conjoint, le Secours catholique, Oxfam France, ONE France et CCFD-Terre Solidaire.   Dans les prochaines semaines, le texte des eurodéputés fera l’objet de négociations avec les autres commissions et avec le Conseil européen qui avait adopté, il y a un an, une version beaucoup plus édulcorée des nouvelles règles de transparence financière applicables aux entreprises des Etats membres.Plusieurs observateurs ont alors fait remarquer que la  position du Conseil avait été dictée par les gouvernements britannique et allemand, opportunément conseillés par des multinationales. Le message du Parlement aux Etats membres est clair : il ne sert à rien de vouloir passer en force, revoyez votre position. Les opposants font valoir que bien des compagnies échapperont à ces règles, que des distorsions de concurrence seront introduites, que la souveraineté des Etats sera violée. L’objectif de l’Initiative pour la transparence des industries extractives est d’amener les compagnies pétrolières ou minières à publier le montant des impôts et redevances qu’elles paient aux Etats, et ces derniers à afficher leurs revenus. Action qui est censée  mettre au jour les fraudes et les paiements suspects. Le rapporteur pour avis, Raffaelle Baldasarre, a fait remarquer que en dépit du montant élevé des marchés publics, la législation de l’union ne prévoit pas de régime juridique défini pour l’attributions de concessions. L’absence de normes est la porte ouverte à l’inefficacité, de préjudices importants pour les parties prenantes, de conditions inégales pour les opérateurs économiques ce qui cause souvent des pratiques douteuses voire la corruption. Il estime nécessaire une intervention législative européenne. Il souligne la nécessité de règles claires (définition précise des contrats, des exigences d’attribution et de modifications des attributions ou de modification des concessions) et réclame plus de transparence et d’équité. Simplifier pour faciliter la transposition dans l’ordre juridique nationale et garantir l’équité. Et surtout il propose d’accorder la possibilité de choisir dans les critères d’attribution des critères environnementaux, sociaux ou relatifs à l’innovation ainsi que, la cas échéant, la mise en œuvre de politiques visant à promouvoir de manière durable la croissance économique et la cohésion sociale. Etc 47 amendements sont proposés et réécrivent assez largement la proposition de la Commission. -. Proposition de directive sur l’attribution de contrat de concession COM /2011/897 (FR) http://www.europarl.europa.eu/meetdocs/2009_2014/documents/com/com_com(2011)0897_/com_com(2011)0897_fr.pdf (EN) http://www.europarl.europa.eu/meetdocs/2009_2014/documents/com/com_com(2011)0897_/com_com(2011)0897_en.pdf -. Projet d’avis de la commission des affaires juridiques, rapporteur Raffaelle Baldassare http://www.europarl.europa.eu/meetdocs/2009_2014/documents/com/com_com(2011)0897_/com_com(2011)0897_en.pdf (EN) http://www.europarl.europa.eu/meetdocs/2009_2014/documents/com/com_com(2011)0897_/com_com(2011)0897_en.pdf -. Communiqué de ONE France http://www.one.org/fr/blog/urgent-succes-de-campagne-a-bruxelles/ -.Soreide Tina : “risqs of corruption and collusion in the awarding of concession contracts”. Etude commandée par le Parlement européen (juin 2012) http://www.europarl.europa.eu/RegData/etudes/note/imco/2012/475127/IPOL-IMCO_NT(2012)475127_EN.pdf – Proposition de la Commission européenne, COM(2011)897 du 20.12.2011 (FR) http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2011:0897:FIN:FR:PDF (EN) http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2011:0897:FIN:EN:PDF Classé dans:COOPERATION JUDICIAIRE PENALE, DROITS FONDAMENTAUX, Lutte contre la corruption