Across Europe, countries have stated their ambition to scale up their energy resilience in the wake of Russia’s unjustified military assault on Ukraine and its weaponisation of gas supplies. Many joint gas purchase agreements have been signed, as well as individual deals to secure supply. The new Energy Deals Tracker provides individual energy profiles of each EU member state, noting national and pan-European supply agreements since the outbreak of Russia’s war in Ukraine.

ECFR’s research reveals only around half of the agreements signed by EU countries and institutions this year have an explicit clean energy focus despite an ambition in the EU’s RePowerEU strategy to double-down on clean sources. With ambiguous language emerging from COP27 earlier this month on the acceptability of ‘low-emissions fuels’, the EU needs to double down on its commitment to transitioning away from gas to reinforce global ambition on this front, warns the think tank.

Hungary is now the only EU member state maintaining and tying itself to Russian-sourced supply, according to the analysis. However, there are some other member states that face particularly acute troubles in diversifying away from Moscow.

ECFR argues that, despite immediate struggles for supply, Europeans should be steadfast in scaling-up investment in green infrastructure and delivering on their climate pledges in order to build sustainable energy security.

Headline findings from the Energy Deals Tracker include:

• Europeans are increasingly looking to the Middle East and North Africa in their attempts to diversify supply. Partnerships with producers in Qatar, the United Arab Emirates (UAE), Algeria, Libya, and Egypt, as well as Angola, the Democratic Republic of the Congo, and Namibia, are evidenced widely within the bloc. Several of these deals will require new infrastructure, such as LNG terminals or new pipelines. These connections, however, could restrict the EU’s room for manoeuvre on concerns about human rights in supplier countries.
• There has also been a forging of stronger ties between the US and the EU. In Germany, for example, Energie Baden-Württemberg and US company Venture Global LNG reached an agreement on the supply of 1.5mn t/y of LNG in June 2022. In Poland, in October 2022, the government announced that US company Westinghouse would build the country’s first nuclear power plant by 2033. And, more broadly, the European Commission (EC) has concluded an agreement that will see the US increase its LNG exports to the EU market by at least 15bn m³ this year.
• Around half of the agreements secured in the EU-27 have a clean energy focus. Despite the immediate supply chain pressures born from the conflict in Ukraine, ECFR’s research reveals that Europeans are still trying to keep clean energy security in perspective. However, the energy components of the deals are of varying depth – ranging from the exploration of renewable energy sources to the development of appropriate infrastructure, to direct imports of clean energy. After the failure of COP27 to agree robust language or a workplan for phasing down fossil fuels there is renewed urgency for EU leadership in investing in alternatives, says the ECFR.
• There is a growing realisation within the EU that member states should avoid competing with one another, and instead pursue collective agreements with suppliers. This realisation led to a political agreement at October’s European Council to aggregate the EU-27’s demand for the equivalent of 15% of their needs in filling gas storages – and to seek, on a voluntary basis, joint purchases of gas for the remainder. However, it is yet to be seen how transparent member states are prepared to be with each other regarding the deals they are making.
• The EC is playing an important role in negotiations, as one of the top brokers of deals for the EU identified in the study. As noted, in March 2022, the US promised to increase its exports of LNG to Europe, following a meeting between EC President Ursula von der Leyen and US President Joe Biden. In June and July, the Commission also signed deals with Egypt, Israel and Azerbaijan to increase their gas exports to the bloc. In October 2022, the EU’s Energy Commissioner met her Algerian counterpart to strengthen the partnership between the sides – a process supported by Algeria’s substantial gas exports to Italy, France, and Spain. The EU has also been in touch with Norway – its largest gas supplier – to explore ways to stabilise the energy market.

Meanwhile, highlighting developments in some EU member states:

• Germany, which has been at the centre of Europe’s energy crisis, has concluded a host of energy deals – including some that may violate its COP26 commitment to end support for fossil fuels. Its efforts have focused mostly on LNG from the US, Qatar, and UAE, and on hydrogen from Canada, Saudi Arabia and the UAE. It is also in talks with partners such as Senegal, Nigeria, Angola and Australia.
• Italy, formerly the EU’s second-biggest importer of Russian gas, has made significant moves to diversify supply too. The country has struck new energy deals on gas and, to a lesser degree, oil, with suppliers in Algeria, Libya, and Azerbaijan, and is also reaching out to Egypt, Qatar, the UAE, the Democratic Republic of the Congo, Mozambique, Angola, and Nigeria, as part of its efforts.
• Despite having the world’s highest share of nuclear power for domestic electricity use, France has been troubled by embargoes on oil and gas. To mitigate the damage wrought by dependencies on fossil fuels, the French government has sought to renegotiate its contracts with some of its energy partners, and also signed a global strategic partnership with the UAE to cooperate on hydrogen, other forms of renewable energy, and nuclear power. It also plans to install a new floating storage and regasification unit in Le Havre by January 2023, aiming to increase its imports of LNG, and is working with Spain and Portugal to build a subsea pipeline between Barcelona and Marseille, which will facilitate the movement of gas and green hydrogen across the EU.
• Poland has been at the forefront of initiatives to diversify away from dependence on Russia. In September 2022, it opened a new pipeline to Norway via Denmark that it will use for gas imports. It also has a terminal in Swinoujscie for imports of LNG from Qatar and the US, which will be upgraded by 2024, and another terminal, in Gdansk, could be ready by 2026. In the future, Poland is betting on nuclear power as one of the ways to boost its energy independence – with a recent announcement that US company Westinghouse will build the country’s first nuclear power plant by 2033; while other nuclear plants are also considered.
• Progress has also been made in two of the three countries that benefit from EU exemptions on Russian oil imports. While they continue importing oil via the Druzhba pipeline, they have diversified their other energy imports away from Russia. The Czech Republic is trying to obtain LNG from the US and Qatar, and more pipeline gas from Norway. It has also shifted supplier delivery to its nuclear power plant in Temelín. In Slovakia, the government plans to reduce dependence on imports of Russian energy by two-thirds. This should mean that, by 2023, around two-thirds of Slovakia’s gas consumption will come from imports of LNG and Norwegian gas.
• Hungary stands alone in Europe in maintaining – and even expanding – its energy ties with Russia. ECFR’s research notes that, while Hungary is bound by a 2014 contract with Russian firm Rosatom to build two new reactors at its nuclear power plant in Paks (a project that is financed by a Russian loan), it has made little effort to diversify its wider supply. It stands alone in Europe on its energy strategy of maintaining dependence on Russia-sourced energy. The Hungarian government has also taken steps to increase its procurement of Russian gas through Gazprom, and has served as a persistent bulwark to the EU’s efforts to sanction Russian energy imports to the bloc.
• The war in Ukraine has also laid bare Bulgaria’s heavy dependence on Russian energy. Until April 2022, Bulgaria imported almost all its gas – which accounts for 12% of its final energy consumption – from Gazprom through a single route. The US and EU countries have helped Bulgaria avoid major energy shortages by supplying it with LNG, while Azerbaijan has also agreed to increase its gas supply. The previous Bulgarian government also opened the Gas Interconnector Greece-Bulgaria and purchased a stake in the Alexandroupolis LNG terminal. This should now finally allow Bulgaria to stop relying on pipeline gas from Russia, although political uncertainty in the country means that option is not completely off the table, notes the ECFR.