Joss Garman: We must reduce our dependence on gas

IN the shadow of the Ukraine crisis, Europe’s energy security is once again at the top of the political agenda because a third of Europe’s gas supplies come from Russia.

At least 24 of the 28 countries in the EU – including Britain – import gas from Russia, and half of this flows through Ukraine.

In June this year Russia cut off gas supplies to Ukraine for the third time in eight years, causing prices to rise and once again raising fears that European supplies could be interrupted if they did it again in the midst of the winter.

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While there has been plenty of talk about the potential for fracking for gas from underneath the UK, the best way to really slash our reliance on Russian gas is in fact to reduce our dependence on gas full stop.

According to the number crunchers at the European Commission, gas imports are cut by 2.6 per cent for every one per cent improvement in energy saving,.

That’s why I have set out how by 2030 Europe could cut its gas dependence by a third if European governments followed a shared strategy with its focus on improving energy efficiency. That’s about the same proportion of the EU’s gas currently met by Russian supplies.

In contrast, even if fracking for shale gas went ahead at a large scale, analysis by the respected International Energy Agency (IEA) shows it is unlikely to account for more than 10 per cent of Europe’s gas supplies by 2030, meaning we would still be reliant upon imports and other sources for the other 90 per cent.

Since most of the projected increase in consumer energy bills is expected to result from the rising cost of imported fossil fuels, and the need to replace old and polluting power stations, directing investments into energy efficiency would also save us all money.

In fact, it is expected that a target currently being considered by European leaders – to improve the efficiency of the whole European energy system by just over a third by 2030 – would cut the EU’s fuel bill by a staggering half a trillion euros. The potential savings for consumers are enormous. In contrast, if we remain heavily reliant upon gas imports but look to other countries beyond Russia to supply us such as the US and Australia, consumers could be hit by big energy bill hikes as Europe would need to compete with Asian economies like Japan that are prepared to pay more.

Getting more home-grown clean energy sources, like wind and solar power, and more heat from renewable sources – like ground source heat pumps and so-called “biogas” from our waste system – can also eat into the 15 per cent share of UK gas supplies currently met by gas imports from Russia.

It would also have the benefit of bringing new jobs and industries to the UK, and cutting our carbon pollution levels.

European leaders urgently need to put fresh momentum behind the transition towards using these new clean energy technologies, or we risk losing out on industrial opportunities to other major economies like the US and China.

Last year China invested more in clean energy sources than the whole of Europe, and already seven of the top 10 solar companies in the world are Chinese. Similarly, an American company just overtook a European company to take the top spot as the world’s biggest wind turbine manufacturer.

The tragedy is that Europe has led the way in these technologies, so now is the time when we should be doubling down on our move to clean energy and reaping the rewards in terms of new jobs and factories.

Instead, Europe’s political leaders are dithering: delaying the big decisions because they’re too riven with disagreements over how ambitious we should be.

Next month they will meet again and are expected to this time sign off on a package of new energy policies for the continent out to 2030.

At least seven countries, including Germany as well as crisis-hit member states like Portugal and Greece, 
are supporting a strong energy 
efficiency target as a key component of this package to improve our security, cut fuel bills, reduce pollution and create jobs.

It is time David Cameron ended Britain’s opposition to such a goal – not least because it could be a key part of Europe’s broader response to Russian aggression.

Joss Garman is Associate Fellow at the Institute for Public Policy Research (IPPR).