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Nord Stream 2 strengthens Europe’s security of gas supply

March 21, 2016 | Zug | Nord Stream 2 takes note of the new letter addressed to the President of the European Commission. We agree that security of energy supply is of key importance, not only for Central and Eastern European countries but for the whole EU. Regrettably, the letter is based on a number of misconceptions and allegations that do not stand up to objective scrutiny.

Security of supply and diversification

EU energy supply has never been more diverse than it is today, in contrast to the letter’s claim of threats to security of supply and diversification of sources, suppliers and routes.

Gas imports from Russia currently only account for about 6% of the EU’s total energy consumption, and Russian gas imports compete with more international suppliers to the EU than ever before. Between 1990 and 2014, the share of gas from Russia in Western European imports dropped by almost half. Today it covers app. 30% of the EU’s gas consumption.

Dependency

Nord Stream 2 will increase security of gas supply for the whole EU, and poses no risks to Central and Eastern European countries who are “still highly dependent on a single source of energy”.

Nord Stream 2 will deliver additional volumes of gas, which helps to address the EU’s declining domestic production. Through Nord Stream 2 these additional volumes will be delivered directly and in the most economical way to the EU’s internal market.

A well-supplied internal energy market is the key to making additional sources of gas supplies available to Central and Eastern European countries. Precisely those countries who worry most about dependence on one gas supplier have the most to gain from projects like Nord Stream 2, which will enable them to procure more gas through a competitive internal market and from more diverse supply routes.

The EU will need more import capacity for gas: North Sea reserves are depleting rapidly, while gas demand continues to grow modestly. In electricity production, gas is the cheapest and quickest solution for cutting CO2 emissions by 50% in comparison to coal. Regrettably, the letter to Commission President Juncker fails to recognize any of the benefits of additional gas imports for the global climate and the European environment.

Nord Stream 2 will contribute to a competitive internal energy market. From Germany’s Baltic Sea coast, approximately 1/3 of the gas can be transported to hubs in North-Western Europe. The other 2/3 of the gas will flow towards the Central European Gas Hub in Baumgarten, Austria. This hub offers ideal connectivity and can handle large flows to Central, East, South-East and South European countries, boosting their gas markets to comparable levels of liquidity and competiveness as in North Western Europe.

EU law

Nord Stream 2 is fully committed to the rule of law. The project will only go ahead based on approvals and instructions from the competent authorities of the countries whose jurisdiction Nord Stream 2 crosses. This process is based on EU law, national legislation and international conventions. It involves the most detailed scrutiny of the project, thorough environmental assessments, transparent public hearings and cross-border stakeholder consultations.

All relevant topics will be dealt with in an orderly manner and in due process. Nord Stream has set a strong precedence: it is internationally recognized for high standards and transparent project implementation.

No gas import pipelines from third countries to the EU’s internal market are subject to the Third Energy Package (TEP). North African pipelines and Nord Stream have always been treated as outside the scope of the TEP. Even Norwegian import pipelines, which are within the internal market, are categorised as “upstream” and thereby excluded from key provisions of the TEP. The legal precedent is very clear.

In the meantime, Nord Stream 2 will continue to engage broadly and transparently with decision-makers, interest groups, and the general public.

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