Less than two weeks from the start of Russia’s full-scale invasion ofUkraine, the European Commission released its REPowerEU proposal, with a raft of measures to reign in energy prices and end Europe’s overdependence on Russian natural gas.
Along with state aid, electricity price regulation, tax treatments and market actions to protect the economy and temper the effects of high energy prices on both producers and consumers, the proposal includes far-reaching interventions both to replace natural gas and store more of it. Biomethane, renewable hydrogen and energy efficiency are at the core of measures to replace fossil gas. The Commission envisions these measures eliminating 100 bcm (billion cubic meters) of natural gas usage, equivalent to 30% of Europe’s fossil gas consumption or two-thirds of its gas imports from Russia, by the end of 2022 – half of this is to be met by LNG imports, although an already stressed global market is unlikely to be able to provide anywhere close to that amount. At the same time, the EC proposes to mandate filling European gas storage to 90% capacity by the end of the filling season every year: for 2022, that would require over 75 bcm of injection, as much as the highest yearly injection ever on record.
As a proposal made at short notice under a situation of crisis, the REPowerEU package is likely to undergo further changes as the practicalities of its implementation become clearer. At the same time, the EC’s priorities as seen in REPowerEU may be reflected in more energy policies even into the future. With the need for energy security growing more pressing by the day, which of these measures lead to the right way forward for Europe?
