Social Europe

politics, economy and employment & labour

  • Themes
    • European digital sphere
    • Recovery and resilience
  • Publications
    • Books
    • Dossiers
    • Occasional Papers
    • Research Essays
    • Brexit Paper Series
  • Podcast
  • Videos
  • Newsletter

Why Europe can’t break free from the gas lobby

Pascoe Sabido 13th April 2022

Europe’s problem isn’t just dependence on Russian oil and gas. It’s dependence on fossil fuels, period.

gas,Russia,fossil fuel,LNG
Gas is heating Europe—but also the planet (PLUkaAOM/shutterstock.com)

The invasion of Ukraine has exposed the European Union’s dependence on Russian oil and gas. Its imports are directly funding Vladimir Putin’s war efforts, to the tune of €20 billion in March alone.

The EU’s response—driven by a mix of concerns over energy insecurity, price rises and domestic political instability, as well as the need to defang the Russian war machine—has been to double-down on gas from other sources and promote alternatives proffered by the fossil-fuel industries. Yet the latest report from the Intergovernmental Panel on Climate Change says we need to slash fossil-fuel use: it is ‘now or never’ to stave off climate disaster.

So how did the EU come to depend not just on Russian gas, but all fossil gas? It is a consequence of how the fossil-fuel industry successfully captured EU decision-making. This was evident in 2014, when Russia occupied Crimea, and it continues today with the powerful gas lobby shaping Europe’s response to the Ukraine crisis.

Due to this ‘gastastrophe’ of corporate capture, the EU will continue to fuel conflict (if not in Ukraine then in Yemen and elsewhere), continue to fuel climate chaos and continue to fail the millions who are facing a growing cost-of-living crisis.

Our job is keeping you informed!


Subscribe to our free newsletter and stay up to date with the latest Social Europe content.


We will never send you spam and you can unsubscribe anytime.

Thank you!

Please check your inbox and click on the link in the confirmation email to complete your newsletter subscription.

.

Focused minds

Russia’s annexation of Crimea in 2014 focused EU minds on reducing reliance on its gas. But rather than ramping up wind, wave and solar energy, or energy efficiency—measures which would tackle climate change, fuel poverty and gas dependency—the EU focused on gas from other, equally dubious, sources. Political and financial backing was given to pipelines from Azerbaijan—which has an appalling human-rights performance and is in chronic conflict with neighbouring Armenia—and liquefied-natural-gas (LNG) terminals, which could ship in gas from the United States generated by fracking.

This is the direct result of the co-dependent relationship between the European Commission and the gas lobby. The very companies which build and operate gas pipelines and LNG terminals—such as Italy’s Snam, France’s GRTgaz, Belgium’s Fluxys, Spain’s Enagás and the United Kingdom’s National Grid—were incorporated into EU policy-making via their membership of the European Network of Transmission System Operators for Gas (ENTSO-G), a group created by EU legislation.

The role of ENTSO-G is to predict future gas use and propose infrastructure projects to meet it—which its members then build. There could not be a more obvious conflict of interest. Unsurprisingly, the group has consistently overestimated future gas demand; as a result, between 2013 and 2020 the EU spent €4.5 billion on 44 new gas infrastructure projects, with 90 per cent of the money going to ENTSO-G members.

Remained dependent

Thus, despite the urgency of the climate crisis, the EU has remained dependent on a fossil gas whose carbon footprint can be as bad as coal. Thanks to falling domestic production and increased LNG import capacity, Russia filled the gap by piping and shipping its gas. By 2021 Russian imports had reached 40 per cent of total EU gas consumption, an increase of almost half compared with 2013.

This not only made a mockery of climate goals. By failing to move away from gas, the EU rendered itself far more vulnerable to changes in global gas prices, particularly LNG spot prices, which caused energy prices to soar in autumn 2021—even before the invasion of Ukraine.


We need your support


Social Europe is an independent publisher and we believe in freely available content. For this model to be sustainable, however, we depend on the solidarity of our readers. Become a Social Europe member for less than 5 Euro per month and help us produce more articles, podcasts and videos. Thank you very much for your support!

Become a Social Europe Member

The EU is once again trying to reduce its dependence on Russian gas: its RePowerEU communication issued in March aims to reduce demand by two-thirds by the end of 2022 and to stop all fossil-fuel imports—coal and oil included—by 2027. But the proposed solutions have the fingerprints of the gas lobby all over them.

Under RePowerEU, which will be fully fleshed out by mid-May, oil and gas will be sought from sources beyond Russia. These include other repressive regimes, such as (again) Azerbaijan and Qatar, where thousands of migrant workers have died since the country was awarded this year’s football world cup. Another candidate would be Saudi Arabia: the Saudis executed 81 people just days before the UK prime minister, Boris Johnson, visited Riyadh to urge an increase in production.

The drive for diversification is accompanied by a massive push for new gas infrastructure, from the industry and from the commission. We are facing half-a-dozen new LNG terminals in Germany and the revival of MidCat, a shelved pipeline from Portugal to Spain and then France. Yet new research shows increased support for rooftop solar and energy efficiency could reduce Russian gas imports by two-thirds in the next three years, with existing infrastructure easily covering the remainder.

Techno-fixes

RePowerEU also sets huge targets for gas-lobby techno-fixes, such as hydrogen and biomethane, which are a climate disaster but highly profitable for the industry. The communication talks about an extra 15 billion tonnes of ‘green’ hydrogen from renewable electricity by 2030, both domestic and imported, which is more than double the EU’s current target.

But where will the renewable electricity come from when the EU is already missing its renewable-energy targets? Today 97 per cent of Europe’s hydrogen is made from fossil gas and Shell, Equinor and other gas producers are confident fossil hydrogen will remain a permanent fixture. They openly admit there will not be enough renewable electricity to produce the quantities of hydrogen mooted but are using the appeal of green hydrogen, and the broader push for an EU-wide hydrogen market, as a Trojan horse for their own fossil hydrogen. Yet the commission is pushing forward regardless, having crafted its response to the Ukraine invasion hand in hand with the gas lobby.

Meanwhile 2030 targets for biomethane have also been doubled. The commission and the industry claim it will come from agricultural or municipal waste, but high-quality biomethane is easier and cheaper to produce from crops, likely competing with food, as we saw in the 2000s when high biofuel targets saw spikes in food prices and widespread hunger. Given that the pandemic and war are hitting food prices, not just fuel costs, this solution is deeply short-sighted.

Seriously weakened

While the communication covers energy efficiency, compared with previous drafts this has been seriously weakened. According to sources close to the process, neither the commission nor member-state governments are relying on energy efficiency to reduce dependency on gas as that would be ‘not concrete enough’ compared with new sources.

Shifting from cheap Russian gas to expensive and volatile LNG while building expensive new infrastructure is only going to exacerbate the cost-of-living crisis, yet the social impact of the plan is not discussed. The opportunity to tackle it via energy efficiency—such as a mass insulation programme which could have trained up and employed thousands while lowering household bills—has been passed over. That is also a missed opportunity for useful climate action.

Even the positive proposal of a windfall tax on Big Energy, supported by some national governments, has been limited by fears it could ‘de-incentivise’ energy companies from investing in renewable energy. It could not be clearer how the EU is putting the interests of the gas industry before the increasing numbers of energy poor, and climate action, because of the longstanding and incestuous relationship between the gas industry and decision-makers.

Brazen examples

The RePowerEU communication is itself evidence of the corporate capture of EU policy making by the industry, but since the invasion there have been more brazen examples. The commission president, Ursula von der Leyen, openly tweeted about a meeting on reducing gas demand with the European Roundtable of Industrialists, a lobby group at chief-executive level whose members include TotalEnergies, BP and E.On. As a result of that meeting, she announced she was going to ‘[s]et a group of industry experts to help reduce our dependency [on Russian gas]’.

At the national level, the chief executive of the Italian oil and gas major Eni has been on a world tour, alongside the country’s foreign minister, Luigi Di Maio, to secure new gas supplies from such countries as Algeria, Azerbaijan and Angola. Similarly, the German Greens’ new climate and economics minister, Robert Habeck, has been in Qatar signing a deal for LNG.

Corporate capture means EU energy policy is being crafted with and for the gas industry, threatening decades of continued fossil fuel lock-in. If we want to end our reliance on gas—Russian or otherwise—we need to end the relationship between the industry and decision-makers, cutting fossil-fuel interests out of our political system.

In short, we need fossil-free politics.

Pascoe Sabido

Pascoe Sabido is a researcher and campaigner with Corporate Europe Observatory, focused on exposing the power of the oil and gas industry in the European Union and at the level of the United Nations.

Home ・ Ecology ・ Why Europe can’t break free from the gas lobby

Most Popular Posts

schools,Sweden,Swedish,voucher,choice Sweden’s schools: Milton Friedman’s wet dreamLisa Pelling
world order,Russia,China,Europe,United States,US The coming world orderMarc Saxer
south working,remote work ‘South working’: the future of remote workAntonio Aloisi and Luisa Corazza
Russia,Putin,assets,oligarchs Seizing the assets of Russian oligarchsBranko Milanovic
Russians,support,war,Ukraine Why do Russians support the war against Ukraine?Svetlana Erpyleva

Most Recent Posts

trade,values,Russia,Ukraine,globalisation Peace and trade—a new perspectiveGustav Horn
biodiversity,COP15,China,climate COP15: negotiations must come out of the shadowsSandrine Maljean-Dubois
reproductive rights,abortion,hungary,eastern europe,united states,us,poland The uneven battlefield of reproductive rightsAndrea Pető
LNG,EIB,liquefied natural gas,European Investment Bank Ukraine is no reason to invest in gasXavier Sol
schools,Sweden,Swedish,voucher,choice Sweden’s schools: Milton Friedman’s wet dreamLisa Pelling

Other Social Europe Publications

The transatlantic relationship
Women and the coronavirus crisis
RE No. 12: Why No Economic Democracy in Sweden?
US election 2020
Corporate taxation in a globalised era

Foundation for European Progressive Studies Advertisement

EU Care Atlas: a new interactive data map showing how care deficits affect the gender earnings gap in the EU

Browse through the EU Care Atlas, a new interactive data map to help uncover what the statistics are often hiding: how care deficits directly feed into the gender earnings gap.

While attention is often focused on the gender pay gap (13%), the EU Care Atlas brings to light the more worrisome and complex picture of women’s economic inequalities. The pay gap is just one of three main elements that explain the overall earnings gap, which is estimated at 36.7%. The EU Care Atlas illustrates the urgent need to look beyond the pay gap and understand the interplay between the overall earnings gap and care imbalances.


BROWSE THROUGH THE MAP

Hans Böckler Stiftung Advertisement

Towards a new Minimum Wage Policy in Germany and Europe: WSI minimum wage report 2022

The past year has seen a much higher political profile for the issue of minimum wages, not only in Germany, which has seen fresh initiatives to tackle low pay, but also in those many other countries in Europe that have embarked on substantial and sustained increases in statutory minimum wages. One key benchmark in determining what should count as an adequate minimum wage is the threshold of 60 per cent of the median wage, a ratio that has also played a role in the European Commission's proposals for an EU-level policy on minimum wages. This year's WSI Minimum Wage Report highlights the feasibility of achieving minimum wages that meet this criterion, given the political will. And with an increase to 12 euro per hour planned for autumn 2022, Germany might now find itself promoted from laggard to minimum-wage trailblazer.


FREE DOWNLOAD

ETUI advertisement

Bilan social / Social policy in the EU: state of play 2021 and perspectives

The new edition of the Bilan social 2021, co-produced by the European Social Observatory (OSE) and the European Trade Union Institute (ETUI), reveals that while EU social policy-making took a blow in 2020, 2021 was guided by the re-emerging social aspirations of the European Commission and the launch of several important initiatives. Against the background of Covid-19, climate change and the debate on the future of Europe, the French presidency of the Council of the EU and the von der Leyen commission must now be closely scrutinised by EU citizens and social stakeholders.


AVAILABLE HERE

Eurofound advertisement

Living and working in Europe 2021

The Covid-19 pandemic continued to be a defining force in 2021, and Eurofound continued its work of examining and recording the many and diverse impacts across the EU. Living and working in Europe 2021 provides a snapshot of the changes to employment, work and living conditions in Europe. It also summarises the agency’s findings on issues such as gender equality in employment, wealth inequality and labour shortages. These will have a significant bearing on recovery from the pandemic, resilience in the face of the war in Ukraine and a successful transition to a green and digital future.


AVAILABLE HERE

About Social Europe

Our Mission

Article Submission

Membership

Advertisements

Legal Disclosure

Privacy Policy

Copyright

Social Europe ISSN 2628-7641

Social Europe Archives

Search Social Europe

Themes Archive

Politics Archive

Economy Archive

Society Archive

Ecology Archive

Follow us on social media

Follow us on Facebook

Follow us on Twitter

Follow us on LinkedIn

Follow us on YouTube