Debating the value of the proposed North Stream II project with Commissioner Canete

At the Plenary session in Strasbourg last week, MEPs debated the North Stream II gas pipeline project with Commissioner for Energy and Climate Change, Miguel Arias Canete.

The North Stream I pipeline, inaugurated in 2011, is an offshore pipeline transferring natural gas from Russia to Germany under the Baltic Sea. The new plan would see the capacity of the pipeline doubled.

Currently, Russia sells gas to the EU via three routes: North Stream I, under the Baltic Sea to Germany; Yamal, via Belarus; and via the Ukraine gas transit network (GTS).

Russia has been trying to circumnavigate Ukraine to pipe its gas to Europe directly because of pricing disagreements, which have led to disruptions (along the GTS) in supplies to the European Union.

In September 2015, a consortium of Russian and European companies concluded an agreement to build a new North Stream project aiming to add fifty-five billion cubic metres capacity to the current infrastructure, which would double the capacity of the North Stream to almost 30% of current EU demand.

Doubling the capacity of the North Stream pipeline has important economic and geopolitical implications for the development of the EU’s Energy Union. It is vitally important therefore, for the project to be thoroughly evaluated by the European Commission.

I have urged the Commission to ensure that the project complies with EU laws on energy markets and to carry out an investigation into the implications of doubling the pipeline’s capacity for Central and Eastern European Countries. Ukraine would for example lose part of the revenues generated by transit costs, which represent an important part of its budget.

Similarly, the justification for the expansion of the existing pipeline needs to be carefully assessed as the infrastructure currently uses only around half of its capacity.

This political project also goes against one key aspect of the Energy Union: the reduction of Russian gas dependency and the diversification of energy sources, suppliers and routes. If anything, the proposed expansion to the North Sea project could actually increase our dependence on Russian gas;

It is in our interests to find a comprehensive solution to energy security, which covers all Member States, does not divide the North and South of Europe and does not threaten Ukraine’s stability.

Solutions to energy security are to be found in the reinforcement of interconnections mechanisms in Europe and the deployment of funding for this purpose. Crucially, energy efficiency must also be strengthened and developed within the framework of an Energy Union governance system taking local actors into account.

Finally, we should look at developing our own supplies and focusing on renewable energy sources rather than creating further dependence on foreign gas.