Energy Security in Europe – Comments on a Talk by Peter Kiernan of The Economist
Jul 21, 2014
I attended a very interesting talk this morning by Peter Kiernan of The Economist Intelligence Unit who was speaking at a Grayling Brainfood Event on energy security in Europe - a particularly topical subject in light of the recent political developments between Russia and the Ukraine and Europe’s deteriorating relations with Russia.
Peter’s main message this morning was that while oil and coal make up a much larger proportion of Europe’s energy needs than gas, gas is a lot less fungible and there are certain challenges when transporting it. As a result, supply disruptions from Russia could be problematic.
Europe is looking more to source gas from North Africa and the Middle East, although the Middle East itself could have security of supply challenges. Europe’s energy consumption overall is in decline, due partly to slow economic growth since 2008/2009 and partly due to increased focus on energy efficiency as part of the region’s emissions reductions targets. The growth of renewable energy has also had a role to play in this decline.
Around 50 percent of Russia’s gas exports go to Europe. As Europe has been looking elsewhere to diversify to increase its energy security, Russia too will have to diversify and in the meantime remains dependent on Europe to offtake its gas.