BRUSSELS--The European Union's executive arm is planning new
legislation as early as next year that would require national
governments to give it a bigger say in negotiations with Russia on
gas and nuclear-fuel supplies, according to documents seen by The
Wall Street Journal.
The plans--due to be published by the European Commission on
Wednesday--form part of a broader EU effort to integrate the bloc's
energy market and wean the Continent off its energy dependence on
Moscow. But they will do little to ease the standoff between Russia
and Ukraine, in which Russian state gas company OAO Gazprom warned
Tuesday that supplies to Europe could come under pressure within
days.
The proposal is likely to face opposition from some governments
that are benefiting from their ties to Russia. National
governments--along with the European Parliament--have to approve
new laws proposed by the commission. Last week, Hungary's prime
minister, Viktor Orban, said he opposed any commission interference
in negotiations with Moscow, saying it violates national
sovereignty.
"We will have a major problem" with Brussels, Mr. Orban said. "I
am expecting an escalating conflict."
The 28-country EU buys more than 50% of its energy from abroad,
at an annual cost of around EUR400 billion ($454 billion)--making
it the world's biggest energy importer. Six of its member countries
get all of their gas imports from Russia, a reliance the commission
believes has led to unfairly high prices for consumers in those
countries. Several states in the bloc's east--from Bulgaria in the
south to Finland in the north--also use Russian-designed reactors
to produce nuclear energy, making them dependent on nuclear-fuel
supplies and technology from state-owned Russian nuclear company
Rosatom.
In a 21-page document, which would be followed by specific
legislation, the commission pledged to take a more prominent role
in challenging Russia as Europe's dominant energy
supplier--although it avoided singling out Moscow in writing.
"Energy policy is often used as a foreign-policy tool, in
particular in major energy producing and transit countries," the
document says. "This reality has to be taken into account when
discussing the EU's external energy policy."
As a first step, the commission plans to take a more involved
role in negotiations between European capitals and Moscow on
gas-supply deals. These intergovernmental agreements form the basis
for commercial contracts between Gazprom and national energy
companies and have come under commission scrutiny in the past.
In an antitrust case launched against Gazprom in 2012, the
commission alleges the contracts have been used to unfairly
restrict governments and their gas suppliers from selling unused
volumes to other countries and driving up prices for political
reasons. Gazprom had denied the allegations and no formal charges
have been filed in the case.
Under the plans set out in the document, governments would have
to inform the commission about negotiations with Russia and other
supply countries in advance, allowing its officials to check
whether the agreements comply with EU competition and
energy-security rules. The commission will also move to propose
"standard contract clauses [which] could...more effectively avoid
undue pressure and ensure respect of European rules," the document
says.
Hungary will likely also be among the states pushing against
commission plans to enforce more transparency in contracts linked
to nuclear-power plants in member states. "The commission will
update and enhance the requirements on the information to be
provided...on nuclear installation projects," the document says,
without giving more detail.
The commission said this month that it was examining whether a
contract with Rosatom to expand Hungary's Paks nuclear plant was in
line with EU rules on public procurement and state subsidies. EU
rules currently require major government contracts to be awarded
through a competitive tender, which a commission spokeswoman said
didn't happen before the expansion of Paks was awarded to
Rosatom.
In addition to enforcing more transparency in supply contracts,
the document sets out plans to boost imports of liquefied natural
gas, especially to countries in the Baltics and the Europe's
southeast that are heavily reliant on Russian gas, and to cultivate
alternative suppliers such as Azerbaijan and Turkmenistan. It also
flagged measures on boosting energy efficiency and cutting
carbon-dioxide emissions to reach targets decided by EU leaders
last year.
Margit Feher contributed to this article.
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