Tuesday, January 13, 2009

EASTERN EUROPE: Go with Putin, or Go Nuclear

By Claudia Ciobanu

BUCHAREST, Jan 12 (IPS) - The gas crisis has placed environmental concerns on the backburner, and raised demands for nuclear production at plants once considered unsafe.

Over the past week, Bulgarian authorities have had to restart one unit of Bobov Dol thermal plant because of the shortage of gas. The Bobov Dol plant is one of the main polluters in the country, lacking a sulphur purification facility and producing greenhouse emissions above the permitted level. Following Bulgaria's entry to the EU, units of Bobov Dol had to be shut down to meet European environmental standards.

Similarly, with entry to the EU, Bulgaria has had to start phasing out its nuclear plant at Kozloduy, considered an environmental and safety hazard. Kozloduy was producing much of the electricity used in the country, and allowed Bulgaria to become an exporter in the Balkans.

Kozloduy became a hot issue between Bulgaria and the EU during the accession negotiations, but over the past week some European officials have been pushing for reopening two reactors at the plant.

A group of euro-parliamentarians (Geoffrey Van Orden from the UK, Ari Vatanen from France, Jan Zahradil from the Czech Republic, and Vladimir Urutchev from Bulgaria, all four representing the European People's Party, the conservative group in the European Parliament) issued a statement Thursday urging the European Commission to support any request for reactivation of two reactors at Kozloduy.

"In many European countries the nuclear energy issue has been neglected in spite of repeated warnings," the four MEPs wrote in a letter to the European Energy Commissioner. "Now, the impact of the severe economic crisis is compounded by obstinacy and failure to take timely decisions that would have ensured safe, reliable, clean and affordable energy for today and the years ahead. We ask you to review the Kozloduy situation."

Bulgarian economist Aleksandar Vassilev from Arizona State University in the U.S. told IPS that such calls might be hasty. "The problem is the gas supply-demand equation, not electricity supply-demand. Affected (by the interruption in flows of Russian gas) are natural gas operating cars, places that use central heating such as most of the residences in Sofia, schools and other public institutions. The effect on electricity is secondary. Nuclear plants should not be in the discussion at this point."

But every alternative to Russian gas seems now to be on the table. The interruption of Russian gas supplies to Eastern Europe has proven that much of Europe, even EU members, are energy vulnerable.

The Czech Republic, Slovakia, Hungary, Croatia, Serbia, Bosnia, Macedonia, Romania, Bulgaria and Greece have all been affected by last week's halt in Russian gas supplies coming to the region through Ukraine. On Sunday night, Russia and Ukraine were still negotiating the restarting of gas flows to Europe. Even after they reach an agreement, it will still take days before Eastern European consumers are ensured normal levels of gas supplies.

One of the worst hit by the gas shortage was Bulgaria, which is importing more than 90 percent of its gas from Russia. Not only was industrial production restricted, but more than 75 schools and some hospitals had to be closed across the country. Much of transportation and many homes were left without heating.

Better placed was Bulgaria's northern neighbour, Romania, which is able to produce over half the gas it needs, and imports only about a third of its consumption from Russia. But Romania too declared a "national emergency" in the energy sector, allowing utility providers to make use of fuel oil from national reserves to meet consumer needs, though utility companies announced they are having technical difficulties replacing gas with other fuels. Levels of industrial production were reduced.

Russian officials have been saying the problem was caused by the transition country, Ukraine, rather than by issues with the Russian supply. Ukraine, in its turn, blamed Russia. But what can countries in Eastern Europe do to make sure they do not experience similar energy shortages in the future?

At a press conference for foreign journalists Thursday, Prime Minister Vladimir Putin directly addressed a Romanian reporter from national television TVR, telling him that Russia was ready to start supplying gas to Romania any time, without using Ukraine as intermediary.

"I have an offer for Romania which will be difficult to refuse, please send this message to your president," Putin told the Romanian reporter. "We are ready to give your state companies the whole volume of gas we are currently delivering to Ukraine," said Putin, "and then you are free to sell it to Kiev."

Like the rest of Europe, Romania is currently getting its imports of Russian gas through pipelines passing through Ukraine, there being no major alternative routes.

Ever since President Traian Basescu came to power in 2004, relations between Romania and Russia have been tense, especially in the energy sector. The possibility of creating alternative gas transit routes between Russia and Romania has not even been discussed.

Basescu has instead been arguing for increased independence from Russian energy. The Romanian president has been one of the main promoters of Nabucco, a pipeline project meant to bring gas from Azerbaijan and possibly Iran, bypassing Russian transport infrastructure. Nabucco would transit Turkey, Bulgaria, Romania and Hungary, and end up in Austria. It could potentially supply 5 percent of Europe's gas needs.

While the European Union (EU) has nominally embraced the project, not much progress has been made in concretising it. Meanwhile, Russia is arranging the building of an alternative pipeline, South Stream, to take Russian gas to Europe through Turkey, Bulgaria, Serbia and Hungary. Hungary and Bulgaria, which had initially committed to Nabucco, have since been negotiating their participation in South Stream. Romania has kept to its position of promoting Nabucco.

But Putin now says "we are not against Romania participating in South Stream." Energy analysts point out that bringing gas from Russia to the Romanian port Constanta rather than Bulgarian Varna might be cheaper.

Romanian authorities have not responded to Putin's informal proposal. Even though the chances for Nabucco to become reality are decreasing by the day, the country has enough gas for the moment to play the waiting game.

No comments: