Europe's Security Depends On A European Energy Union

(MENAFN- Gulf Times) In a world in turmoil, the European Union's security agenda is as expansive as it is urgent. From building economic resilience to achieving rapid rearmament, progress on almost any of its components depends on one thing: energy.
Two recent landmark reports on EU competitiveness highlight what should be obvious: high energy prices and insecure supplies directly undercut economic stability and dynamism.
European industry forms the backbone of European competitiveness and has a vital role to play in European rearmament.
The European Commission's Clean Industrial Deal aims to balance the twin imperatives of re-industrialisation and decarbonisation, including by promoting public and private investment in clean technologies and supporting energy-intensive industries, such as steel and chemicals, in the green transition. But the vision remains incomplete, not least because it neglects Europe's fuel-manufacturing industry.
This“silent” sector, which supplies 97% of the energy for transport and 50% of the feedstock used by the chemical industry, is more than a relic of a fossil-fuel-powered past; it is a cornerstone of the European economy. Entire value chains rely on the stability and affordability it provides, which renewables will not match anytime soon.
And yet, the Clean Industrial Deal includes no strategy for the fuel industry's development. Nor does it mention European fuel companies' ongoing decarbonisation initiatives.
In line with the Clean Industrial Deal's pledge to“engage in a dialogue with industries to develop sectoral transition pathways,” the European Commission must take immediate steps to develop a transition pathway for fuel manufacturing. A well-designed strategy could unlock billions of euros in investment and advance key EU goals: decarbonising transport and heavy industry, strengthening European industry's global competitiveness, and bolstering Europe's strategic autonomy by reducing its dependence on foreign producers.
Other energy-intensive sectors, too, should be reassessed and integrated into European decarbonisation and re-industrialisation strategies, not sidelined.
This will require the EU to take a pragmatic approach and promote all energy sources that can contribute to a stable, affordable supply, including renewables, fossil fuels, nuclear energy, and hydrogen power. Hydrogen power is particularly important for energy-intensive sectors which cannot be fully electrified. The RePowerEU plan, introduced in 2022, aims to produce 10mn metric tonnes of renewable hydrogen (and import the same amount) by 2030. In order to achieve these goals, the EU must leverage its internal strengths.
The establishment of cross-border hydrogen corridors – within the EU and, ultimately, between the EU and other countries – will require EU-level action, buttressed by private-sector support. This must include the alignment of relevant regulations – that is, a true energy union.
Contrary to popular belief, the energy union is not part of the EU's single market. It is subject to a fundamental contradiction: under the Treaty on the Functioning of the EU,“sustainability” falls under the EU's mandate, but the security of energy supplies remains in the hands of the member states, each of which decides its own energy mix. By now, it should be clear that this is untenable. The only way EU member states can achieve true energy security (or its corollary, energy affordability) is together.
Of course, the EU has a lot on its plate – not least devising a cohesive vision for its global role at a time when the US under Donald Trump's second presidency is proving erratic, unreliable, and increasingly autocratic, and great-power politics are shaping international relations. Such a vision should include deepening relations with a wide range of non-Western countries – such as Brazil, India, Morocco, and the UAE – that share its interest in preserving some semblance of a rules-based order.
But if the EU is to play such a leadership role – providing the kind of legal certainty that can help to counterbalance the transactional, capricious, and intemperate behaviour we are seeing from the US – it must be united, confident, resilient, and competitive. This demands a pragmatic, industry-aligned strategy for transforming itself from a lucrative market for others to an innovative industrial powerhouse in its own right, and enhancing its strategic autonomy on rapidly shifting geopolitical terrain. To succeed, a robust energy union is essential. - Project Syndicate

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