RePowerEU plans misleading and heavily influenced by fossil fuel industry

This piece was originally published by Corporate Europe Observatory. Ceo is a member of the Fossil Free Politics campaign.

The EU’s 300 billion euro response to the growing energy crisis presented by the Commission today, which emphasized ‘eye-blinding ambitions’ for energy efficiency and investments in renewable energy production, should not distract from the fact that the fossil fuel energy companies managed to get their future business secured as well. The announced EU Energy Platform for joint purchases of gas, LNG and hydrogen, which will also identify new gas infrastructure needs, was revealed by Corporate Europe Observatory (CEO) to be advised by the gas industry, a huge conflict of interest. 10 billion euros have been dedicated to “missing links on gas and LNG”.

CEO obtained recent meeting documents from the European Commission (EC) that reveal that CEOs of six big energy companies – Shell, BP, Total, ENI, E.ON and Vattenfall – met President Von der Leyen and Energy Commissioner Simson the day they released the first RePowerEU communiqué and agreed to set up an industry Task Force and determine which measures were “feasible”.

The meeting, which took place on 23 March, was the latest in a long line between the European Roundtable of Industry (ERT) and its CEO-level members with President Von der Leyen since the invasion of Ukraine. This means the EU’s plans to get off Russian gas are being shaped by the very same companies that have kept the continent hooked on it until now.

RePowerEU also emphasized the importance of hydrogen for replacing Russian gas, particularly by importing it. According to recent research and analysis by lobby watchdog Corporate Europe Observatory (CEO), RePowerEU sees the gas industry securing big EU subsidies for producing hydrogen outside of the EU via a ‘Global European Hydrogen Facility’. New gas infrastructure is also being justified on the grounds it will be ‘hydrogen-ready’ if/when the EU shifts from gas to hydrogen, which is what the gas industry has been long demanding

On the eve of RePowerEU, CEO and Transnational Institute (TNI) launched a new report which found that the EU’s plan to drastically increase the use of renewable hydrogen (H2) is not realistic, and will hurt North African countries' economy.

The study - which focuses on Morocco, Algeria and Egypt, as the majority of H2 imports will come from the Southern Mediterranean - estimates that production costs will make renewable hydrogen up to 11 times more expensive than natural gas (before transport costs are factored in).

These vast costs make for unrealistic targets that are being used by Big Oil and Gas to sneak hydrogen from natural gas through the back door. This means they can keep drilling and selling their main product, and thus leading to runaway climate change, according to the latest IPCC report.

Pascoe Sabido, Researcher and Campaigner at the Corporate Europe Observatory, said:

“The EU plans for getting off Russian gas look very similar to the demands made by fossil fuel CEOs when they met with President Von der Leyen. Despite all the talk of renewable energy, another €10 billion is going on new pipelines and LNG terminals when it should be spent on insulating the homes of the energy poor.

The EU’s push for importing renewable hydrogen should also be a big concern to countries in the global South. They are coming under increasing pressure to use their renewable energy for hydrogen to meet European climate goals, rather than meet their own clean development needs.”

Chloe Mikolajczak coordinator of the Fossil Free Politics Campaign said:

"The RepowerEU strategy has the gas industry's fingerprints all over it. This is not surprising considering the Commission has been meeting with CEOs of gas company ahead of its release and agreed to set up an industry task force to determine feasible measures. It's going to be an important part of the EU Energy Platform. If the EU is serious about reducing its dependency on fossil gas, and not just Russian gas, it should stop taking advice from the fossil fuel industry."

ENDS

For more information or interview requests:

Pascoe Sabido:  pascoe@corporateeurope.org - +44 7969 665 189

Chloe Mikolajczak: chloe@fossilfreepolitics.org - +32 486.31.18.14

Notes to editors:

• The EC has been working closely with fossil fuel companies on the RePowerEU plans; See the Commission summary of the meeting here and their more in depth summary here.
• Minutes from a meeting on the day RePowerEU was announced show fossil fuel CEOs offered President Von der Leyen and Energy Commissioner Kadri Simson their steer on the direction they should now take, with all sides agreeing to create a Task Force with company experts to determine “what is feasible” in terms of the Commission’s “envisaged measures”.
• For more information on the Global European Hydrogen Facility, see our latest article, see here.
• For more information on the push by the gas industry for ‘hydrogen-ready’ infrastructure, see here.
• For more information on the Fossil Free Politics campaign, see here.
• For more information on how the gas industry, through ENTSO-G, was instrumental in increasing Europe’s dependence on Russian gas and is in line to do the same with RePowerEU, see here. The EU-Russia advisory group has also been involved in facilitating Europe’s Russian gas dependency since 2014. The EC website showed until a few weeks ago that it had been discontinued in 2014 after the annexation of Crimea. But on the administrative and business level it was very active until last month. See background note for more information.
• Key points from the meeting between VDL and ERT:
• CEOs explain how “Europe pays a high price for energy because we are very dependent on imports”, despite they themselves being responsible for by lobbying for more gas and against alternatives.
• “Request for a coordinated EU approach, maintaining market mechanisms and speeding up administrative and permitting procedures”.
• “Most (not all [energy CEOs]) guard against fiddling with market mechanisms, which would have unintended consequences.”
• “Majority says a gas (TTF) price cap will be problematic,” despite such measures potentially greatly helping gas consumers.
• “President Biden cannot impose deliveries. Best option is to envisage long term contracts.” This would lock the EU into importing fracked gas for a decade or more
• They discussed the “importance of energy financial markets”, which provided bonanza Q1 profits for Total, BP and other fossil fuels companies
• Key roles of the agreed Task Force, as laid out in the minutes:
• “Provide detailed information on markets and on what is feasible in terms of envisaged measures”, allowing oil and gas CEO to set the limits of what is or isn’t possible in RePowerEU
• Discuss “where can additional [gas] supplies come from.” In practice it means supporting other repressive regimes (Egypt, Azerbaijan, Qatar) and imports of fracked gas from the USA,
• Discuss “what are possible bottlenecks” in gas supply, i.e. which new gas infrastructure projects should be built, despite them not coming online for years and locking the EU into future gas dependency.

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