Nord Stream 2 and EU Energy Strategy

A summary can be found here.

Hi guys,

I found this extremely helpful Nord Stream 2 strategy paper by the European Political Strategy Centre (Link: https://ec.europa.eu/epsc/publications/other-publications/nord-stream-2-–-divide-et-impera-again_en).

It analyses the project from an EU perspective and gives insights into its history and political context. In my summary, I concentrated on the relation of Nord Stream 2 towards EU energy policy and strategy.

However, it might also be helpful for those analyzing specific member states or those researching the history of the project.

Summary “Nord Stream 2 – Divide et Impera Again?”
European Political Strategy Centre

According to the authors, Nord Stream 2 “is a project with neither economic rationale nor political backing” from a common EU policy perspective. Since only half of the available gas import capacities in the EU were used in 2015, Nord Stream 2 will most probably lead to stranded assets. Furthermore, the pipeline will not contribute to the declared EU goal of diversifying EU energy sources, suppliers, and routes, but rather lead to an increased economic and political dominance of Russia (for a summary of the specific positions of the member states, consult pages 10 – 12). Not only is this perceived as a security threat to the Baltic countries, but it jeopardizes the EU foreign policy towards the Ukraine and Russia in the context of the annexation of Crimea. Therefore, the authors call Nord Stream 2 a test for the solidarity of the EU.

Nord Stream 2 conflicts with the EU Energy Union and Energy Security Strategy aiming to guarantee energy security and to build a fully integrated internal energy market. In the past, the EU has supported a broad range of projects that helped to diversify gas import infrastructure, e. g. the Southern Gas Corridor or LNG terminals in Poland. Additionally, the EU is helping to modernize the Ukrainian pipeline network, in order to ensure its reliability.
Nord Stream 2, on the other side, will lead to an increasing concentration of gas imports through the Baltic corridor and will not contribute to EU energy security, since the EU already has enough pipelines to import all the gas it needs.

In 2016, President Juncker said “The Energy Union cannot be held hostage by pipeline politics, and any new project must comply with European rules and align with European interests”.
Consequently, the EU has tried to bring forward a specific legal regime and negotiation mandate for Nord Stream 2. However, the legal service Council clarified, that such a mandate does not fall under the exclusive EU competence. The EU gas laws forbidding gas production and pipeline operation by one and the same company do not apply to pipelines from third countries. A full change of this directive was rejected only last week (New York Times Feb 7th). It remains a situation in which the EU does not have a functioning tool to influence Nord Stream 2 in any meaningful way.

Nord Stream 2 will come and it seems like Germany will get away with it as it is. However, this is not the end of the story. The authors suggest that Nord Stream 2 has somehow paralyzed EU policy for a resilient Energy Union. The best policy to reconcile member states might be to continue working on the many Energy Union projects that have already begun in many parts of Europe. It is not all about weakening Nord Stream 2, but also about strengthening other energy corridors and partnerships.

2 thoughts on “Nord Stream 2 and EU Energy Strategy

  1. in my separate post on Gas Directive I tried to show that we have work in progress on amendments to Gas Directive but indeed changes won’t go as deep as EC originally planned. There are also questions about how it (if/when adopted) will impact NS2…

    You are right that Energy Union should be built not only by opposing NS2 but also by constructive steps. It certainly is worth discussion and looking into. At the same time I cannot stop thinking that NS2 issue became so much divisive within the EU & beyond that it requires an EU wide, consensual approach whatever the future of the pipeline will be

    Like

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