ENERGY SECURITY

The IEA defines energy security as the continuous availability of energy sources at a reasonable cost. There are several dimensions to energy security: Long-term energy security is primarily concerned with timely investments to deliver energy in accordance with economic trends and environmental requirements.

The global energy environment has shifted considerably in the year since Russia's invasion of Ukraine. Soaring costs have affected consumers hard in many parts of the world, all against a geopolitical backdrop centered on energy security. Furthermore, the world's reliance on fossil fuel usage, as well as the resulting price and resource instability, has come into sharp light.

Because of the mild winter and lower-than-expected demand, the region's gas reserves have remained reasonably constant during the harshest months of the year. While this has helped to mitigate the impact of Russian supply cuts, the situation for winter 2023 may be more problematic. This year, the EU might confront a natural gas shortage of around 30 billion cubic meters. However, by increasing efforts to enhance energy efficiency, deploy renewables, build heat pumps, encourage energy savings, and expand gas supply, the gap may be addressed and the possibility of shortages avoided.

Fig 1

Source: IEA, Share of European Union gas demand met by Russian supply, 2001-2022, IEA, Paris

The figure above shows the sudden drop in the year 2022 when the Russia Ukraine war began.

Immediately following the invasion, global energy costs skyrocketed, hitting a 20% increase for five months in a row.

Prices for oil, coal, and gas skyrocketed in the immediate wake of Russia's invasion of Ukraine and have been unpredictable ever since.

 Since the invasion, energy prices have increased dramatically, helping Russia and other oil and gas producers greatly. Early in April, the EU's foreign policy leader.

Between 23 February, the day before the war began, and 31 July (27 September), European wholesale prices for gas and electricity soared by 115% (109%) and 237% (138%), respectively.

Rising energy prices as a result of Russia's conflict in Ukraine make households more vulnerable to energy poverty.

Worldwide energy prices increased by up to 20% in around five months (from February to July) owing to worries about an embargo. Rising energy prices as a result of Russia's war in Ukraine make households throughout the world more vulnerable to energy poverty.

nations with a strong reliance on Russian energy, such as Central and Eastern European nations, Germany, and Italy, have been disproportionately affected by the rise in energy prices.

Some other energy security aspects include the following:

Diversification of energy sources: Energy security requires the diversification of energy sources. Crude oil, coal, and natural gas are all commodities that are prone to price volatility and supply interruptions. Diversifying energy sources can assist in mitigating these risks and improving energy security.

local production: Increasing local energy production can assist minimize reliance on foreign sources and increase energy security.

Infrastructure security:  Is critical for energy security because it protects energy infrastructure from both man-made and natural disasters. This necessitates ongoing awareness, emergency preparation, and training.

Technological diversification: Rapid deployment of renewable energy and energy efficiency, as well as technical diversity of energy sources, would result in considerable energy security.

Access to less expensive energy: Access to less expensive energy has become critical to the running of contemporary economies and is an important part of energy security.

Predictable pricing: Predictable pricing of energy sources is critical for energy security since it allows for better planning and budgeting.

Long-term planning: Long-term energy security measures focus on lowering reliance on a single source of imported energy, expanding the number of providers, using indigenous fossil fuel or renewable energy resources, and investing in research and development.

SOME OF THE CONSEQUENCES OF RUSSIA LIMITING SUPPLY TO EUROPE AND OTHER COUNTRIES

Cut gas supply: Since its unjustified invasion of Ukraine, Russia has severely cut its piped natural gas supplies to the European Union. Flows through the YAMAL-Europe pipeline system was totally shut down in May 2022, while supplies through the Nord Stream pipeline were steadily reduced until they were completely shut down in early September 2022. Pipeline deliveries to Estonia, Finland, Latvia, and Lithuania were totally halted, while deliveries via Ukraine were considerably cut.

Increasing costs: The global energy situation has altered tremendously, and places all across the world have seen increasing prices, which have been hard on consumers. Europe's usage of Russian gas is falling, and Russia has cut its pipeline gas deliveries to the EU by more than half in the last year.

Economic ramifications: Europe is seeing a partial disruption in natural gas supplies from Russia, its main energy supply. The effects might be reduced by securing alternative supplies and energy sources, alleviating infrastructure bottlenecks, boosting energy conservation while safeguarding vulnerable households, and increasing international solidarity agreements to share gas. The countries' reliance on Russia for gas and other energy sources varies greatly. So far, European infrastructure and worldwide supply have been able to deal with a 60% decrease in Russian gas exports since June 2021. Total gas usage was down 9% year on year in the first quarter, and alternative suppliers, particularly LNG from worldwide markets, are being sought.

NEGATIVE EFFECT OF ENERGY SECURITY

Price volatility: Price fluctuation may have a severe influence on energy security, causing substantial economic disruptions and affecting the cost of energy for consumers and companies.

Dependence on foreign sources: Reliance on foreign energy sources can expose governments to supply interruptions, price shocks, and geopolitical threats.

Environmental impact: Some energy sources, such as fossil fuels, have substantial environmental consequences, such as air and water pollution, greenhouse gas emissions, and climate change. The reliance on these energy sources may increase the environmental consequences.

Infrastructure risks: Energy infrastructure, such as pipelines and transmission lines, can be subject to natural catastrophes, cyber assaults, and physical attacks, all of which can interrupt energy supply and have an influence on energy security.

GOVERNMENT MEASURES TO REDUCE ENERGY DEPENDENCY

Energy source diversification: Governments may diversify their energy sources by investing in renewable energy sources including solar, wind, and hydroelectric power. This has the potential to minimize reliance on fossil fuels and imported energy sources.

Domestic production: Governments may stimulate domestic energy production by giving incentives for the development of domestic energy sources such as oil, gas, and renewable energy sources. This can assist to lessen reliance on foreign sources of energy and increase energy security.

Infrastructure development: To strengthen energy security and lessen reliance on foreign sources, governments might invest in energy infrastructure development such as pipelines, transmission lines, and storage facilities.

Energy efficiency: To minimize energy use and reliance, governments should support energy efficiency measures such as building insulation, effective lighting, and energy-efficient appliances on foreign sources.

Research and development: Governments can invest in innovative energy technology research and development to minimize reliance on foreign sources and increase energy security.

International collaboration: Through international cooperation, governments may work together to increase energy security and minimize reliance on foreign sources by sharing energy resources, implementing joint energy projects, and encouraging energy efficiency measures.

 CONCLUSION

To summarize, energy security is a complicated issue that need a diversified approach to secure continuous access to energy sources at a reasonable cost. Governments and other stakeholders must consider the negative consequences of energy security and establish policies and tactics that enhance energy security while minimizing these consequences.

REFERENCE

1.     Energy security – Topics - IEA

 IEA, Share of European Union gas demand met by Russian supply, 2001-2022, IEA, Paris

2.     How a Russian Natural Gas Cutoff Could Weigh on Europe's Economies

3.     Energy crisis: Why has Russia cut off gas supplies to Europe? - CNBC

4.     Russia's War on Ukraine – Topics - IEA

5.     energyeducation

6.     The impact of the war in Ukraine on euro area energy markets - European Central Bank

7.     The spillover effects of rising energy prices following 2022 Russian invasion of Ukraine

8.     Russia-Ukraine war has nearly doubled household energy costs worldwide – new study - The World Economic Forum

9.     Inflation: How are rising food and energy prices affecting the economy? - The World Economic Forum