EU climate policy to boost energy security

PRAGUE – The day before the EU Commission presented its ‘Fit for 55’ package proposals in Brussels, the Czech Republic’s Deputy Foreign Minister for European Affairs Ales Chmelar told New Europe on July 13 that the Czech Republic is looking to diversify its energy resources as the country strives to meet its climate goals.

“Certainly, energy independence or diversification is also part of the climate debate,” Chmelar said in an interview on the sidelines of the Prague European Summit. “Nevertheless, the current energy mix, the composition of our energy production is such that if we do not try even to use this kind of infrastructure be it pipelines but also coal plants and in the transition time to build for gas and make them appropriate for gas energy supplies, we will most probably not be able to meet the targets. As you know, one kilowatt of energy made of coal is roughly twice as demanding in terms of CO2 as gas which means that in the meantime to be realistic, to be able to build capacities both of renewables but also nuclear energy in our case we need natural gas.”

Asked if the Czech Republic is dependent on Russian gas supplies, the Deputy Foreign Minister noted that most of the natural gas comes from Germany with sources that are both in Russia, but also Norway, and also potentially from liquefied natural gas (LNG) terminals in the Baltic or the North Sea.

“Those are actually occasions for diversification in the future but it is true that our infrastructure is very much intertwined with Central European space in general and more western-ward looking than it was 20 years ago so there are changes and we’re at least not directly depending on the Russian gas. And, at the same time, gas will be this transition medium only for a limited time and if we want to fulfill the climate neutrality by 2050, also the gas at some point actually will crowd out of the energy mix by renewables and other clean technologies,” Chmelar told New Europe.

Chmelar noted a branch from the Nord Stream 2 pipeline from Russia to Germany will also provide the Czech Republic with natural gas. “I have to say that our gas infrastructure was, in the 1990s, basically fully privatized so the level of influence of the government on the management of gas on our territory is limited to the regulatory level and the companies on our territory have made the integration with the German and Western European gas market quite strong so it’s clear that Nord Stream-2 would also contribute and the potential LNG terminals would contribute also to our supplies. This is not up for debate, but it was also not necessarily a strategic decision by the government, but maybe a result of the privatization of the 1990s.”

Regarding car battery independence from China, Chmelar said the topic is a pan-European issue.

“In a way, the battery supplies are too low in order to somehow compensate in the transition towards electric cars to compensate for the added value that is produced inside Europe in the normal combustion engines. The Czech Republic together with other Central European countries is heavily dependent on the automotive industry and also the labor-intensive parts of this production. And electric cars have, in general, the biggest added value in their battery so if we are not able to produce batteries on the European territory and preferably also from resources from the European territory and Czech Republic has potentially sources of lithium, then we will lose out a large part not only of the automotive sector but also the linked sectors and industries,” Chmelar said, adding that this could mean lower employment in Central Europe.

“We have a double motivation compared maybe to other not so much producing countries where the automotive industry is headquartered and where the decisions are taken where potentially, preferably some of the new productions and research could be based. In our case, even though Skoda cars has a large part of its research on the Czech territory, we are still mostly car producers rather than car inventors and technology inventors which means that for us is a key topic and that’s why we have made inside the Visegard Group but also individually a very strong reach out towards the initiative of the Battery Alliance of (EU Commission Vice President) Maros Sefcovic,” Chmelar added.

Turning to international cooperation in tackling climate change, the Czech deputy Foreign Minister for Europe said there is certainly a political will to find a solution and set common targets. “Nevertheless, there is a lot of work to be done in terms of how we get there. And this week we will see from the Commission the proposal for ‘Fit for 55’ which is 12 individual (legislative) proposals,” he said.

Chmelar reiterated that lively debates about the car industry and its adjustment to climate policies took years. “And now we have 12 very sensitive issues that we have to tackle stemming from ETS (Emissions Trading Scheme) expansion to, of course, cars, CO2 emissions but also issues that concern trade such as the Carbon Border Adjustment Mechanism. So, there are a lot of issues and a lot of work ahead of us and I think that there is a will but it does not necessarily mean that this will be a quick process. Because the number of interests and the redistributive effects of this policy change is huge and I think it’s maybe comparable only to the oil crisis in the 1970s,” Chmelar said, adding, “Personally, I do not really register any bigger economic transformative project that basically this climate change policies and the goals that were set in 2018 for the whole of the EU.”

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