Europe is playing Russian Energy Roulette with REPowerEU
The REPowerEU plan, designed with the idea of completely ending Europe’s dependence on Russian fossil fuels, is a political document with which the European Union launched a game of Russian roulette, and the The arguments for both results are strong, said lead researcher Željko Lovrinčević. at the Institute of Economics in Zagreb. He warned that the question of the economic viability of the plan has yet to be raised, but that citizens will do so soon as they will have to pay the price in higher energy and food costs.
Željko Lovrinčević said that the REPowerEU plan is first and foremost a political document placed in the context of achieving energy and climate goals.
All policy documents must be assessed from the point of view of economic feasibility and sustainability, he said and asked if it was sustainable with regard to the competitiveness of European companies compared to companies from other parts of the world that have different energy prices.
The question of the sustainability of the REPowerEU plan will be asked by citizens
Lovrinčević asserted that the question of the sustainability of the plan will be raised by the public, the citizens, very soon, in connection with the cost of the war in Ukraine.
It is certain, in his words, that European citizens will see a continuous growth in the share of energy in their consumption and the same will be true for food.
Speaking during the webinar “REPowerEU: Croatia and Europe’s energy prospects”, Lovrinčević asked if citizens would reject REPowerEU to avoid losing money intended for things like health or education.
Is the political agenda clouding the overall view of the situation?
The senior researcher at the Zagreb Institute of Economics also said the main questions were what the plan means for citizens in terms of their standard of living, how much energy would cost in Europe compared to the rest of the world, what is happening with Europe’s competitiveness, and whether the political agenda is clouding the overall picture.
Lovrinčević thinks Europe has started playing Russian energy roulette. He added that it sometimes ends favorably and other times not. In his words, it could be a turning point, a great success, but it could also become a failure. The arguments are quite strong for both outcomes, he added.
Too heavy a burden for European citizens can ruin a good idea – the energy transition
According to Lovrenčić, good ideas sometimes fail, such as the energy transition in this case, because things speed up too much and unrealistic targets are set, so the burden on European citizens can have a counter-effect.
Europe will spend the next years, even decades, providing new sources of energy for basic needs, something everyone now takes for granted, he stressed.
It will be easier for rich countries, but much more difficult for Central and Eastern Europe, which is more dependent on Russian fuels and has lower incomes.
If the richer countries do not show solidarity, there will be resistance among the poorest against entering the process, Lovrinčević said.
Babić: low-income EU countries will be taken into account
Ante Babić, a senior official at the European Commission’s Directorate-General for Energy, admitted that there are many obstacles to the implementation of the REPowerEU plan and that it is a politically motivated document, arguing that politics prevailed.
EU member states have different views, from those who say the transition is too slow to those who don’t see it as something good. But, in his words, it is clear that the EU has no oil, gas or coal, so it must turn to renewable energy sources.
EU prepares mechanism to ensure funds don’t end up in rich countries
Babić claimed that the financing mechanism of the REPowerEU plan would take into account countries that buy more oil and gas from Russia so that they receive more funds.
The European Commission is working on a mechanism to ensure that projects not only end up in Germany and Italy, but also in countries from the Baltic to Bulgaria, Babić said.
The webinar was also attended by Ivo Milatić, State Secretary for Energy at the Ministry of Economy and Sustainable Development, Ana-Maria Boromisa from the Institute for Development and International Relations, Božidar Poldrugač, member of the Board of Directors of Končar, and Darko Lopotar of Schneider Electric. The EU Delegation to Croatia organized the event.