Germany to stay in command on Nord Stream 2 after deal with France on EU directive
to a last-ditch deal struck by France and Germany, which will likely complicate the Russian-German pipeline project Nord Stream 2, but not rule out its construction, . The member state proposal to amend the EU gas directive has to be agreed in negotiations with the European Parliament over the coming months.
The gas directive agreement 鈥渨as possible because Germany and France worked closely together,鈥� German Chancellor Angela Merkel told journalists in Berlin.
- Kanzlerin zur Einigung zur EU-Gasrichtlinie und zu den deutsch-franz枚sischen Beziehungen:
鈥� Steffen Seibert (@RegSprecher)
The European Commission had wanted to change EU law so that in the future, gas pipelines to and from third countries fall under EU oversight, and thus stricter rules. With the deal, the new rules generally cover any pipeline to and from a third country, but the EU member state a pipeline enters whether to apply the amended rules.
This is a major step forward in the creation of a truly integrated internal gas market which is based on solidarity and trust with full involvement of the European Commission.
On 12 February, the it had reached a provisional agreement with the Council and the European Parliament to go ahead with the amendments, which still need to be formally agreed by the latter two institutions "in the coming months". The agreement "closed a loophole in the EU legal framework" and ensured that the principles of EU energy legislation (third-party access, tariff regulation, ownership unbundling and transparency) apply to all gas pipelines to and from third countries. "Exceptions are only possible under strict procedures in which the Commission plays a decisive role," said the Commission in a press release.
"This is a major step forward in the creation of a truly integrated internal gas market which is based on solidarity and trust with full involvement of the European Commission," said energy Commissioner聽Miguel Arias Ca帽ete.
In an , German economy and energy minister Peter Altmaier said the decision is a 鈥渟trong signal鈥� to 鈥渋deologically motivated critics鈥� of the project.
However, the dispute about the directive and Nord Stream 2 is not over, yet. The developments of the past days shows that 鈥渢imes are over in which the German government can tell itself that its will is European law,鈥� , industry policy spokesperson of the Green Group in the EP.
Katrin G枚ring-Eckhardt, co-head of the Greens鈥� parliamentary group in the German Bundestag said the decision is disappointing, . 鈥淣ord Stream 2 was wrong from the get go and continues to be so, because it does not only tie us to climate-harmful energy sources for decades, but also makes us dependent on a Russian leadership which acts increasingly authoritarian,鈥� she said.
Until now, France had supported Germany in its opposition to the new rules, but the it intended to support the adoption of the Commission鈥檚 proposal.
鈥淲e have recently witnessed a rise of tension in Franco-German relations, mostly related to German reluctance to embrace Macron鈥檚 plans for the EU,鈥� Marco Giuli, policy analyst at the European Policy Centre (EPC) told 威力彩玩法. He sees the pipeline deal between the two countries as a 鈥渢ypical transactional exchange鈥�. Ultimately, Nord Stream 2 鈥減roved to be a bargaining chip rather than a vital issue for national interests,鈥� said Giuli.
The Nord Stream 2 natural gas pipeline, currently under construction under the Baltic Sea, has been the subject of heated debates for years. The project, scheduled for completion in late 2019, would allow additional Russian gas to flow directly to Germany. Proponents from industry and the German government argue the pipeline is a commercial investment and key to Europe's supply security, while opponents, including some government coalition parliamentarians, object to Nord Stream 2 on environmental, geopolitical and security grounds. A number of EU member countries such as Poland but also non-EU countries such as Ukraine fiercely oppose the pipeline which they fear will increase Russia鈥檚 influence while diminishing their own ability to benefit from the gas trade.
The original Commission proposal for today鈥檚 decision would have meant for example, that the owner of the pipeline arriving in the EU and the gas supplier cannot be the same company 鈥� which is the case with Gazprom and Nord Stream and could have presented a significant hurdle for the project. It was not immediately clear whether this rule would have to be applied under the amendment proposals.
France and Germany to ensure oversight will come from the "territory and territorial sea of the member state where the first interconnection point is located."
鈥淐ertification exclusively belongs to the national regulator,鈥� said EPC鈥檚 Giuli, 鈥渁nd it won鈥檛 be easy for the European Commission to challenge the German regulator take on Nord Stream 2.鈥�
Uncertainty regarding future gas demand, as Germany exits coal and nuclear energy
Natural gas currently covers almost a quarter of German primary energy consumption, and the country is the world鈥檚 biggest natural gas importer, acquiring more than 90 percent of the gas it consumes from Russia, the Netherlands and Norway.
Chancellor Angela Merkel has said that Germany will need more gas, when the country follows through with proposals by the coal exit commission to phase-out coal-fired power generation by 2038. Energy minister Altmaier has also said Germany鈥檚 energy transition, the Energiewende, meant that the country鈥檚 natural gas supply will increase during a 鈥渓ong鈥� transition period in which the fossil fuel with relatively low carbon emissions will be an important bridge technology. As European gas production is set to decline, projects like Nord Stream 2 but also the construction of a shipping terminal for liquefied natural gas (LNG) would ensure a diversified supplier network to cover growing demand, he said.
However, the question how European and German gas demand will change in the future is far from settled. The German Federal Institute for Geosciences and Natural Resources (BGR) in a 2017 study that domestic natural gas use will grow, FNB Gas, the association of Germany鈥檚 gas transmission system operators, gas use in the country to fall over the next decade. 鈥淕ermany may never get a natural gas boom even with coal exit,鈥� an article on said, quoting an unpublished study by an unnamed major energy company.
Projections for future EU gas demand also . 聽鈥淓urope has vast spare import capacity, and could rely upon an upgraded and adequately maintained Ukraine route,鈥� says EPC鈥檚 Giuli. The EU energy market expert says Nord Stream 2 would improve the commercial position of some EU countries, but has the potential to worsen that of others. 鈥淵et, the discussion on 鈥榥eed鈥� can hardly be confined to the commercial and technical terms of the project. There is a significant political dimension that cannot be overlooked,鈥� said Giuli.
US interest
The connection of the political and economic aspects of Nord Stream 2 became apparent in mid-2018, when US President Donald Trump lashed out at the project and said Germany was 鈥渢otally controlled鈥� by Russia. The United States has been promoting its LNG exports to Europe, and US ambassador to Germany Richard Grenell of a growing reliance of Europe on Russian gas, and told German companies of possible sanctions over Nord Stream 2.
As a 鈥�gesture to our American friends鈥�, economy minister Altmaier announced Germany would quickly choose where to build its first liquefied natural gas (LNG) terminal. His ministry has scheduled an LNG conference that includes speakers from the US government on 12 February.
