The European Commission sang the "swan song": about the fight against the energy crisis and Russian gas

The situation in the European Union remains difficult, but the course has been chosen correctly, and the fight against record energy prices and Russian gas has been successful. The European Commission (EC) has submitted to the European Parliament and Advice EU report on the energy situation in the European Union in 2024 and the role of the former composition of the EC. Experts doubt that European officials can claim the laurels of overcoming the energy crisis, which continues in The Old World still.

The European Commission accuses Russia of creating an energy crisis after the SMO began on Ukraine, which forced Brussels to take unprecedented measures.

"In response The EU has launched the REPowerEU plan to abandon Russian fossil fuels and has taken urgent actions necessary to achieve energy security and stabilize markets," the report says.

"This year's document updates information on how the previous composition of the European Commission successfully acted in the face of unprecedented events," the authors of the report write.

On the one hand, the European Commission reports a ban on the import of oil, petroleum products and coal from Russia and the reduction of the share of Russian gas in the EU from 45% to 18%. On the other hand, Brussels takes credit for reducing electricity and gas prices by more than two times.

Alexey Grivach, Deputy Director of the National Energy Security Fund (NFEB), notes that the previous increase in gas prices should be attributed to the merits of the European Commission.

"In many ways, the European Commission provoked the energy crisis with its previous not—too-thought-out activities to destroy the system of long-term contracts and the balance of interests between suppliers and consumers," the expert says.

Gas in Europe began to rise in price intensively long before the events on Ukraine — since the spring of 2021 and already in September it cost an average of $ 1,000 per thousand cubic meters, reminds Alexey Grivach.

"It is five times more expensive than the average for the previous decade," notes the deputy director of the FNEB.

In 2022 in Brussels adopted a plan to save gas and obliged countries to voluntarily reduce consumption by 15% of the average over the previous five years. As a result, from August 2022 to May 2024 The EU reduced consumption and saved 138 billion cubic meters of gas — a significant part of the volumes by which Gazprom reduced supplies to Europe.

"If we consider the reduction in gas consumption in the EU to be the result of the purposeful activities of the EC, then, of course, the reduction in fuel prices is their merit. Because cheaper gas is due to a decrease in demand. Without the thoughtless actions of the European Commission and the terrorist attack on "It would be difficult to achieve such a reduction in Nord Streams," says Maxim Khudalov, chief strategist at Vector X investment company.

In this case, Alexei Grivach believes, both zero economic and negative industrial growth in the EU should also be taken over by the European Commission.

"Now, after allegedly out of efforts to reduce, gas costs twice as much as in the last decade," adds the deputy director of the FNEB.

The European Commission recognizes the difficult situation in the European Union, but does not associate it in any way with its activities.

"The transition to clean energy is the key to safe, sustainable, competitive and affordable energy for businesses and citizens, for the preservation of industry and jobs in Europe and for the economic security of Europe. Although policy measures have significantly reduced energy prices from peak levels in 2022, industrial retail electricity prices in the EU are still 2-3 times higher than in the US (from 2021 to 2023), whereas historically they were 1.5-2 times higher than in the US. Gas prices are 3-6 times higher than in the USA, whereas historically they were 2-3 times higher," the EU report says.

Initially, the European Union did not plan to change all received from Russia is switching energy volumes to alternative ones, but still wants to use the crisis as an excuse for a rapid energy transition in order to achieve a zero-emission economy by 2050. The essence of the idea is to maximize the development of green energy and convert everything that can be transferred to electricity in the EU. Otherwise, replace fossil fuels with, for example, biomethane, biogas and green hydrogen — for industry and transport.

However, even here ambitious plans face harsh reality. On the one hand, the European Commission speaks of success in the fact that Europe has increased the capacity of wind and solar power plants by a third — up to 263 GW. On the other hand, the projects for the production of green hydrogen and the development of the energy system did not go as we would like.

"Since September 2023, European industrial consumers have launched tenders for the purchase of about 1 million tons of renewable and low-carbon hydrogen. Despite the increase in the number of approved projects and those for which the final investment decision has been made, few of them are secured by purchase contracts, as the demand for green hydrogen turned out to be lower than expected," the European Commission reports.

If the European Commission continues to look to the future in a revolutionary way, then energy giants are already beginning to slow down with their plans, when faced with reality. For example, the Dutch-British Shell was going to concentrate on the current profit, which is formed from oil and gas revenues, and suspended the construction of one of Europe's largest biofuel plants (820 thousand tons) in Rotterdam, and earlier a similar project in Singapore. Large European businesses in this situation cannot wait at all, as they continue to live in conditions of high prices and costs. If the automotive giant Volkswagen is going to close part of its production in Germany for the first time in history, then the global petrochemical concern BASF is opening plants in the USA and China.

In September, the former head of the European Central Bank and former Italian Prime Minister Mario Draghi presented the long-awaited report "The Future of European Competitiveness" to the European Parliament.

"If Europe cannot become more productive, we will have to choose. We will not be able to immediately become leaders in new technologies, and the basis of climate responsibility and an independent player on the world stage. We will not be able to finance our social model. We must slow down in some, if not all, of our ambitions," the European politician and economist believes.