EU Set to Make First Joint Gas Purchase

The EU plans to start jointly buying natural gas before winter as the bloc has been looking for ways to cut dependence on Russian energy and fill stocks against further energy supply shocks.

The European Commission has proposed a plan last week for the bloc to wean off Russian fossil fuels by 2027 by accelerating renewable investments, energy saving and switching to non-Russian fossil fuels.

Russia supplies 40% of the EU’s gas needs but cut off supplies to Poland, Bulgaria and Finland after they refused to pay gas in roubles.

The bloc intends to start jointly buying gas this year, before winter. The joint purchase plan is supported by an EU platform launched last month that would pool countries’ demand and coordinate use of infrastructure to import non-Russian supplies.

Joint buying will be voluntary for countries. It is uncertain however how the bloc would secure supplies in a tight global market as well as the complex nature of coordination within the EU’s governments, companies and institutions to make the purchases.

Brussels believe the EU members could gain access to supplies if they work together that would be otherwise unavailable.

The EU Energy Policy Chief Simson said they were aware that the supplies have been tight and some of the supplies coming to Europe are only available because of political decisions, pointing to the U.S.-EU agreement from March for the U.S. to deliver an extra 15 billion cubic meters (bcm) of LNG to Europe this year.

The EU imports 155 bcm of gas from Russia each year.

Brussels has said countries should mostly use renewables and energy savings to replace those volumes, and expects gas demand to drop 30% by 2030 under the EU’s climate change targets.

But in the short term, Europe remains reliant on fossil fuels. The EU last week agreed a law requiring countries to fill gas storage 80% ahead of winter, to help provide a buffer against fossil fuel supply shocks.

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