EC give pipelines & power €2.3bn boost

European Commission Funding

The European Commission have announced they are to invest a huge chunk of the EU's five-billion euro economic stimulus fund in aiding the construction and development of 43 pipeline and electricity projects.

In all, 2.3 billion euros will be thrown at gas and power connections to help prepare Europe for its energy future in which there are plans to develop a pan-European super-smart-grid that will connect up a vast array of renewable and traditional energy sources from across the continent.

The decision granted 0.91 billion euros for 12 electricity interconnection projects and 1.390 billion euros for 31 gas pipeline projects.

Last December saw a series of offshore wind and carbon capture and sequestration projects that will eventually 1.565 billion euros from the same stimulus package, which has been labelled a "milestone in the history of EU energy policy" by Energy Commissioner, Günther Oettinger.

Flexible responses in crisis situations

"Never before has the Commission agreed such an important amount for energy projects. We have selected key projects which will help create a more integrated energy network in Europe ensuring flexible energy flows across member states' borders," he said.

The projects subject to the recently announced funding include key interconnectors linking up the currently isolated Baltic States and neighbouring Finland, Sweden and Poland, and an array of reserve flow projects to bring flexibility to responses in crisis situations.

Some controversy has emerged over the European energy commission's decision to invest 200 million euros in the construction of the Nabucco pipeline, a gas line that will constructed with the sole purpose of taking gas from the Caspian region to a number of European markets. It has been viewed by Russia as a rather antagonistic move that directly competes with its own South Stream pipeline.

However the majority of criticism surrounds the projects failure to, as yet, secure any gas supplies on top of not filling the criteria of a 'mature project', which is the prerequisite for funding under the stimulus package. As Euractiv reports, the plan requires that all funds are committed by the year's end in order for the projects to contribute to economic recovery.

Problems surrounding Nabucco

Nabucco will eventually help Europe reduce its dependency on Russian gas, which is considered a priority according to Oettinger: "Nabucco is not just a possible new pipeline. It's a European project," he said, adding that the fact that talks about funding had started makes the project more credible.

When asked whether the problems surrounding the Nabucco could effect whether it goes ahead or not, Jeremy Ellis, head of business development at RWE Supply & Trading, said he did not believe this was the case.

"The timetable for Nabucco is now in the suppliers' hands, not ours," Ellis said.

He was eager to stress that the securing of gas supplies was close at hand and that he fully expects the project to have secured a final investment decision by the end of 2010.

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Daniel Jones

Daniel is a Politics and Philosophy graduate from Cardiff University where he also worked as a section editor on the award winning student newspaper. After university he joined an IT support company where he was a B2B online writer. He loves anything to do with sport and joined GDS in July 2009.

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