The EU needs to increase its powers for an effective energy strategy, says Giles Merritt
If ever there was a dossier that highlights the European Commission's failing powers, then it is energy. It is the policy area where the opinion polls tell us Europe's citizens must look to Brussels for an EU energy strategy that will safeguard supplies in the difficult years ahead, but it is also an area where the Brussels Commission has little or no real power. It never had it, of course, so it may sound a bit harsh to speak of its 'failing powers'. But the sad truth is that, in general, the Commission's star is on the wane, so the chances of it acquiring the authority needed for an EU-wide energy regime continue to look fairly remote.
Europe's national governments are responsible for their own energy policies, and jealously guard against any encroachments on their turf by the EU. And as we live in a market economy, there is very little that Brussels can do about the jockeying for advantage we see almost every week in our newspapers.
The truth is, meanwhile, that more nonsense is uttered about energy than almost any other policy area. Much of it is political grandstanding by governments and the Commission, of course, but also by NGOs and other vociferous pressure groups.
The first nonsensical but widely held view is that oil, now heading towards $80 a barrel, is too expensive. Quite apart from the fact that being priced in flabby dollars gives a misleading picture of its cost to consumers in most non-dollar economies, the truth is that energy prices had, for almost 30 years after the oil crisis following the 1973 Yom Kippur war, not kept up with price rises in general. Another nonsense vigorously propounded by special interest groups led by the green lobby is that both our energy and climate change problems could be tackled substantially by bio-fuels. For the public at large, it's very beguiling to be told that green fuels could resolve these global problems without any real sacrifice on their part. The reality is that it will be extremely peripheral while raising huge issues ranging from fuel taxation to its impact on food production worldwide. Experts warn that to substitute bio-fuels for just a tenth of fuel demand by 2025 would take 29% of the planet's present farmland.
The area where the EU could make a major contribution to energy policy is, though, in external relations. Early November will mark the 18th anniversary of the fall of the Berlin Wall and the beginning of the end of the Soviet Union, yet the EU has so far failed to fashion a Russia policy worthy of the name. Instead we've heard political leaders across Europe complaining that Moscow is using its huge oil and gas resources as 'a political weapon'.
What we need to see, without delay, is a coherent EU-level strategy setting out our concerns and goals when dealing with Russia. That would quickly put an end to Moscow's and Gazprom's tactics of divide and rule. And, once that is done, the next step should be for the EU's vaunted Common Foreign and Security Policy to turn its attention to other key players on the energy scene, beginning with the Middle East and China, and set out Europe's strategic approach to them too. That's the sort of energy strategy that Brussels could realistically devise.
