Poland’s Tusk Proposes Energy Union to Break Russian Hold on Gas

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Created on Tuesday, 22 April 2014 11:17

Polish Prime Minister Donald Tusk proposed a Europe-wide energy union, including a single body charged with purchasing gas supplies, as a means of breaking Russia’s “stranglehold” over the region’s energy market.

In an op-ed column published in today’s Financial Times, Tusk called for the creation of a European Union institution to negotiate energy contracts with Russia. Member states should also work more closely together on energy infrastructure to guarantee the security of supplies and look to better exploit fossil-fuel resources, he said.

“Excessive dependence on Russian energy makes Europe weak,” Tusk said. He cited the dependence of at least 10 of the EU’s 28 members on Russian state-controlled gas exporter OAO Gazprom for more than half their consumption.

Poland is leading calls for intensified sanctions against Russian President Vladimir Putin’s government amid the standoff with the U.S. and its allies following Russia’s annexation of Crimea and building tension in eastern Ukraine.

Tusk, seeking a third term as prime minister in elections next year, will meet with French PresidentFrancois Hollande in Paris on April 24 and then travel to Berlin for talks the next day with German Chancellor Angela Merkel. He is due to meet with EU President Herman Van Rompuy in Brussels tomorrow.

Uranium Precedent

Citing the EU’s joint purchasing of uranium for nuclear power, the Polish leader said that bilateral energy contracts should be made transparent, and that contract templates and a greater role for the European Commission should be introduced.

The EU should also divert resources to expand storage capacity and gas links among its 28 member states in case the government in Moscow shuts off supplies, as it did in 2009 over a dispute with Ukraine, Tusk said. EU states, particularly in the bloc’s east, should be allowed to exploit coal and shale resources to protect supplies, he said.

“No nation should be forced to extract minerals but none should be prevented from doing so -- as long as it is done in a sustainable way,” Tusk said.

The EU should also look beyond Russia as global supplies and new markets in shale and liquefied natural gas -- such as in the U.S. and Australia -- become accessible, Tusk said.

source: bloomberg