Energy Security

Key Points

Prof. Tatiana Romanova

School of International Relations
St. Petersburg State University

Rome Center for High Defense Studies, 25th September 2006

1. Energy security can be guaranteed by two different ways:
 
a) American model is based on market and commercial approach. The role of the state is limited to the construction of the valid rules that enable companies' activities;
 
b) French model is based on the strong state intervention and state match between supply and demand.
 
The current processes in the European Union are concentrated on liberalization of the energy that is about demonopolisation and introduction of competition in exploration, generation and supply to final consumers. Externally this transformation should be matched by the transfer from the French model to the American one.
It is important to state that there is no black and white picture and no total refusal from the French model. The short-term supply will be always based on the state intervention and therefore on the French model. The significance attached to the crisis stocks is a good illustration of this question.
 
2. The transfer of the energy security from the French to the American model is complicated in the European Union by the unresolved confrontation between memberstates and the EU institution on whether the energy security should be mainly decided at the national level or at the level of the EU/EU. To make picture worse different member states of the European Union are not the same in terms of the resource availability and main suppliers of gas and oil.
 
3. The energy security dilemma of the EU's member-states that acceded in 2004 (or will accede in 2007) is further worsened by the fact that they are dependent on one gas and oil supplier (Russia). They therefore feel extremely insecure. This feeling is further worsened by the fears that they inherited from the history. This gives rise to their efforts to restrain market activities (like purchase of oil-processing plants or gas pipelines by Russia) or designing geopolitical schemes that would make Russia dependent on transportation of energy resources through their territory (the debates around the North European Gas Pipeline is a case in point). It all boils down to the new member states favouring the French model (which is in contrast to the old member states of the European Union that are more in line with the American model in the long run).
 
4. Russia strongly argues that the future energy relations should be based on partnership and should take into consideration not only security of supply but also security of demand.
This last thing means that the suppliers have to be sure that they will have access to the consumers and that the amount of energy resources that they produce will be sold.
Furthermore, in the view of Russia as major supplier the access to its energy resources should be matched with the access of Russian companies to the final consumers in chief importers of Russian gas. However, at present the views of the European Commission are that Russia can only have access to the European consumers provided it has liberalised its own market, preferably on the basis of the EU's designed principles. This last thing is not acceptable for Russia. As a result the debate creates a strong unease about the further development of the Energy Dialogue as well as about the spread of the American model in EU-Russian energy relations.