Denmark says EU green energy deal best way to sanction Russia

Reuters News
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Posted: Oct 02, 2014 12:16 PM

By Barbara Lewis

BRUSSELS (Reuters) - A European Union deal to cut fuel use and increase renewable energy would be a better punishment on Moscow than more sanctions as it would clearly show the EU means to cut reliance on Russian gas, Denmark's foreign minister said on Thursday.

In a telephone interview, Martin Lidegaard told Reuters it was not the time to strengthen or weaken economic sanctions imposed on Moscow by the EU over Russia's actions in Ukraine.

But Lidegaard said Moscow's seizure of Crimea and a gas row between Ukraine and Russia should change the EU's energy relationship with Russia once and for all.

EU climate and energy regulation for 2030 should serve as a clear message that Europe was weaning itself off Russian fuel.

"Right now, I think the present regime is the right one. I don't think we should relinquish it," Lidegaard said of EU sanctions.

"But an ambitious climate and energy package that will impact investment now, if everybody knows we are heading in another direction, that would be a non-aggressive action, rather than going for more sanctions right now. That would be the right way to send a firm signal."

The European Commission, the EU executive, in January outlined climate and energy policy for 2030 and a meeting of EU leaders later this month will seek to get agreement on it from the 28 EU member states.

Commission officials, speaking on condition of anonymity, have said they expect an agreement on a goal to cut greenhouse gas emissions by 40 percent compared with 1990 levels, to increase energy savings to 30 percent compared with business as usual and to increase the share of renewable energy to 27 percent of use. Some say this could be rounded to 30 percent.

Denmark is ranked as one of the more environmentally ambitious member states and Lidegaard said he hoped for a deal, but it would be difficult.

Poland, for instance, with its high dependency on carbon-intensive coal, is still "probably the country having the most difficulties," said Lidegaard, a former Danish energy minister.

GAME CHANGER

But Lidegaard said the Russia-Ukraine crisis should focus everyone's minds.

"Russia should be a game changer," he said. "I think it has become very visible that our current dependency on Russia has a price, a political price and a security price."

Russia has cut off supplies to Ukraine because of Ukraine's unpaid gas bills and Gazprom has been varying the amounts of gas it supplies to its EU customers.

The EU sanctions on Moscow target Russia's finance, defense and energy sectors, but have carefully avoided touching physical supplies of oil and gas.

The EU relies for about a third of its energy, while Russia's state-controlled exporter Gazprom earns around $6 billion per month from selling gas to the EU.

The proposed EU goal to reduce energy use through measures such as better building insulation would automatically cut carbon emissions and curb reliance on Russian gas.

"Energy efficiency and renewables solve all our problems at once," Lidegaard said.

For the medium term, he said gas had a role in "a beautiful partnership" with renewables, which are intermittent and so at times difficult to integrate into the energy system.

"I think gas is a stepping stone to replace coal and nuclear over the next 10 to 20 years," he said, but added the gas must come from a range of countries.

(Editing by David Evans)