Jul 30

European Union Energy Market

Joined up European Union energy market pipeline would increase efficiency and independence

In April, Poland’s prime minister, Donald Tusk proposed a European Union energy market to look at the vulnerabilty of a continent that imports over 1/2 its energy.

His initial timing was perfect for political and economic reasons alike: the crisis in Ukraine and the shale boom in the US are forcing EU countries to assess the inefficiencies of their fragmented energy networks as never before.

If these systems were fully integrated, the consultancy Strategy& (formerly Booz & Co) estimates that Europe could benefit by as much as €40bn in savings each year by 2030.

Mr Tusk has started a diplomatic tour to turn round the European Union to the concept, but the feedback has been mild. He argues that some leaders agree in principle but say publically with “anxiety and fear” when talking about specifics.

He is now pursuading his counterparts to exhibit the same devotion to a common energy policy as they did in the end to saving the euro. “The banking union also seemed close to impossible but the financial crisis dragged on precisely because of such lack of faith. The longer we delay, the higher the costs become,” he said.

Mr Tusk has gone back to a age old skirmish. His proposal ties into one of Europe’s most tenuous ambitions: a single internal energy market for gas and electricity.