Opening remarks by Commissioner Simson at the Energy Council press conference of 27 June 2022

(Source: European Commission)

“Check against delivery”

Thank you, Agnès, you have already given a comprehensive overview of the meeting today, so I will focus on security of supply against the backdrop of Russia’s war in Ukraine.

We had an in-depth discussion with the Ministers today on this. And it’s important that we had that discussion, as the situation is deteriorating. While the gas supply to the Member States is currently guaranteed, the security of supply risks are greater than ever.

Last week, Gazprom reduced the gas supply to companies in five Member States. Overall, 12 Member States are directly affected and some Member States no longer receive any gas from Russia. Today, Russian gas exports to the EU are half of what they were a year ago.

These cuts are part of a deliberate strategy to weaponise gas trade. They aim to spread uncertainty, destabilise the European market and prevent adequate filling of storage. They are designed to increase energy prices and undermine the security of supply.

As I said, the security of supply risks are not immediate. The European gas system has reacted well and so far has been able to absorb the cuts.

In May, we reached another record of LNG deliveries, with 12.8 bcm, which means we are on track to achieve the additional 50bcm foreseen in the REPowerEU plan.

The filling of storage is progressing. Today, the filling level is over 56%, more than the historical average. In this context, I want to thank the French Presidency, but also the Council as a whole and the European Parliament for agreeing the changes to the storage regulation at record speed. I have no doubt that this has sent a very clear message to the companies to act.

Still, some Member States have progressed less well and it is important that all countries continue filling the storage, despite the reduction of gas flows. It is likely that things will become more challenging in the coming months.

Gazprom has already announced a maintenance of Nord Stream 1 from the 11th to the 21st of July. Further decisions by Russia to arbitrarily cut off countries or companies cannot be excluded. Since the beginning of Russia’s invasion of Ukraine, we have known that a very serious disruption is possible and now it seems likely.

We have done much important work to be prepared for this, but now is the time to step it up. The existing preparedness and solidarity instruments are essential, but they are not enough, if all EU Member States are affected for a longer period. We need an additional margin of safety to go through the winter even in the case of full disruption of Russian gas supply.

This is why I proposed to the Ministers six key actions that together would form the Winter Preparedness Action Plan.

First, we will ensure enhanced monitoring and coordination through the Gas Coordination Group over the summer months. The Group has met regularly this year and it needs to continue in the coming weeks and months.

Second, we must replace gas consumption with other fuels whenever possible, in the industrial sectors, but also in electricity and heating. This will reduce gas consumption in the short term.

Of course, fuel switch should happen in a way that doesn’t put our climate objectives at risk. Accelerating renewables deployment is the best solution, and today, with the general approach on the Renewable Energy Directive we have given a strong signal in that direction. My services and I are ready to help the Member States in making and implementing necessary decisions.

Third, we need to boost energy savings and energy efficiency now. We have identified a number of measures in the EU Save Energy Communication that can rapidly reduce oil and gas consumption by 5%. This should be our common priority, as using less energy as we move into the heating season will help us to withstand possible further disruptions. I called today on the Ministers to speed up these measures.

As most of these efforts are voluntary, the Commission is supporting this work with information campaigns, IT-tools and cooperation with organisations like the IEA and the Covenant of Mayors.

Fourth, Member States should update their contingency plans and conclude outstanding solidarity agreements. Only six of the latter are currently in place. This is not sufficient.

Fifth, the Commission will present a Coordinated Demand Reduction Plan. This will include: an updated scenario analysis for next winter; a set of good practices to pre-emptively save gas and guidance on demand management of non-protected consumers, in particular industry.

Sixth, we must double down on efforts for the diversification of supplies – and we need to do it without competing against each other. I have updated Ministers on how the EU Energy Platform is quickly getting up to speed. We have a close cooperation with the US, which has already resulted in a record level of 28 bcm of LNG deliveries this year – and you have seen today’s statement by Presidents von der Leyen and Biden.

We have just concluded a Joint Statement with Norway, and a Memorandum of Understanding with Egypt and Israel to tap into the energy potential of the Eastern Mediterranean. Another memorandum, to prepare the ground for doubling the capacity Trans Adriatic Pipeline, is being negotiated with Azerbaijan. We are also developing the legal tools for future joint purchases.

These are six key actions for the Member States and for the Commission. They follow up on the European Council’s call for closer energy coordination between the Member States. I felt strong support around the table today and will therefore move forward with presenting our proposals in July.

Before I finish, I wanted to acknowledge that despite all this necessary focus on immediate security of supply issues, the only lasting solution for secure and affordable energy is the green transition. The Green Deal is not only an environmental and growth strategy, but also a security strategy.

I am therefore pleased that the Council reached an agreement today on both the Renewable Energy Directive and the Energy Efficiency Directive, supporting more ambition, faster. It is imperative that we continue to rapidly move forward with the Fit for 55 proposals, to make sure that we never again face this risk to our security of supply that we find ourselves in today.

I am very grateful for all the work the French Presidency and Agnès and Barbara have done on these – and all the other – files. This has laid a very good basis to maintain the momentum on the Fit for 55 package and at the same time address energy security in the next difficult six months.

I’m looking forward to working with the Czech Presidency to make our energy system more resilient, independent and sustainable. And together we will continue to support Ukraine, as well as Moldova and Georgia, to withstand the impact of Russian aggression and start the journey towards their EU membership.

Thank you.

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