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Scenarios on European energy security: Outcomes of natural gas strategy in 2020

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Abstract

This paper adopts a futuristic methodology and analyzes the role of natural gas in European energy security in order to transform economic and policy uncertainties into meaningful scenarios. It implements “trend analysis” to forecast the volume of gas needed until 2020 by elaborating the estimates of the EU Commission and “scenario building” to come up with alternative futures forging different regional implications. The economic analysis stems from four scenarios as introduced by the EU Commission: (1) baseline scenario with average oil price of 61/bbl;(2)baselinescenariowithaverageoilpriceof100/bbl; (2) baseline scenario with average oil price of 100/bbl; (3) New Energy Policy scenario with average oil price of 61/bbl;(4)NewEnergyPolicyscenariowithaverageoilpriceof100/bbl; (4) New Energy Policy scenario with average oil price of 100/bbl. The policy analysis is derived from the options, restraints, priorities and strategies of the concerned actors which include the EU Commission, selected EU members, suppliers and transit countries. The analysis on actors results in four policy scenarios: (1) Russia first; (2) Russia everywhere; (3) security first; (4) each for itself. The matrix, which excludes the possibility of unprecedented developments such as a drastic increase in European shale gas production or continuing global recession, clusters 16 contingencies. The paper, within this context, gives an idea on how alternative policy options of European energy security may lead to different futures based on oil prices, environmental commitments and strategic initiatives of the concerned actors.

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... Some events from the recent past that have threatened energy supplies to the EU include the Russia-Ukraine natural gas dispute in 2009 and the annexation of Crimea by Russia in 2014. Such events highlight the need for a more substantive energy policy to overcome possible energy supply disruptions and to mitigate security challenges, particularly by diversifying supply options [1,2]. ...
... It is worth noting that the above-mentioned four gas infrastructure projects have been included in the list of the nine priority corridors. 2 Financial support tools also play an important role in supporting energy infrastructure including those for natural gas. [102] states that the EU recently increased its financial support to promote pipeline and LNG infrastructures. ...
... EU/energy/en/topics/infrastructure/projects-commoninterest/overview#content-heading-5. 2 For details of the TEN-E, see https://ec.europa.the. EU/energy/en/topics/infrastructure/trans-european-networks-energy#content-heading-1. ...
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Meeting the European Union's natural gas demand will require increasing volumes of imports in the foreseeable future. Recognizing the need to ensure uninterrupted and secure supplies of natural gas imports at all times, the European Union (EU) has actively sought to diversify its sources of supply, including obtaining natural gas from Azerbaijan through the Southern Gas Corridor (SGC). In pursuit of this objective, the EU has provided financial support for parts of the Southern Gas Corridor. In this paper, a combination of cost economics and Rational Choice Intuitionalism (RCI) framework has been used to explain the policy choice made by the EU to support the SGC. We observe, that the choice of using the SGC as a supply source has been despite the relatively higher cost of delivery of Azeri natural gas into the EU. The motivation for the EU here is characterized by the strategic importance and part of its efforts to diversify sources of supply in the RCI framework. In this context, the EU is delivering energy security services to its member states who in turn have muted their sovereign rights in exchange for a diversity in the source of supply. This is possibly the only study that measures up the economic cost against choices made under RCI in natural gas security literature.
... According to the results presented in Table 4, direct, positive and high-intensity correlations have been suggested between GDP -oil reserves; GDP -natural gas reserves; GDPnet trade; GDP -current account balance, which show that the economic activity in Azerbaijan is strongly influenced by the capacity of discovery, extraction and trade of domestic energy resources, which is confirmed by the increase of oil and natural gas production capacities in different fields and extraction areas of the country (Abutalibov and Guliyev, 2013;Ahmadov, 2021;Mukhtarov et al., 2020b). At the same time, the quality of the country as an energy producer and exporter is demonstrated by the positive evolution of net exports since 2010 and until now, which leads us to believe that the level of economic growth is supported by the efforts and actions to promote, initiate and systematically develop the access, transport and export routes of energy resources to European markets or those in the Asian region (Bilgin, 2011;Musayev and Aliyev, 2017;Ruble, 2017). ...
... Positive and high intensity correlations are observed between the current account balance -oil reserves; GDP -CO2 emissions; inflation -current account balance; these variables have the power to influence and cause the level of economic growth during the period analysed. In this context, it is interesting to note that Azerbaijan is taking an increasingly strong position on reducing its consumption of greenhouse/carbon dioxide emissions, having implemented national programmes and plans (Dong et al., 2021;Bocse, 2018;Bilgin, 2011) to move towards the increased use of renewable energy resources, promoting a clean and clean environment. ...
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The aim of this research is to conduct an objective and predictive evaluation of Azerbaijan's economic growth from 1997 to 2022. Since Azerbaijan is a significant exporter and producer of energy resources, its economic growth is substantially influenced by the remarkable advancements in oil and gas extraction and production since the early 2000s. Methodologically, we have designed several models to ascertain the influence and impact of the following explanatory factors-oil reserves, natural gas reserves, net trade, current account balance, inflation rate, unemployment rate, interest rate and carbon dioxide emissions - on the economic growth rate. The study utilised a combination of uni- and multi-factorial linear regression techniques, with accuracy and robustness testing conducted on all eight models. Research hypotheses were tested and a predictive analysis was implemented and evaluated over the studied period. Our findings demonstrate that the growth of Azerbaijan's economy is positively impacted by the dynamics and development of energy product trade, particularly in oil. As a result, GDP increased by an average of 2.50%. It is also confirmed that inflation and unemployment have a negative impact which unavoidably leads to instability and an economic downturn. In contrast, the robustness indicators (namely, RMSE, MAE and MAPE) could assess the predictive analysis of economic growth. The validated, low values further endorse the credibility of the eight models in accurately forecasting the economic growth rate throughout the studied period. The study disproves the existence of a positive correlation between GDP and the quantity of carbon dioxide emissions. However, it has been demonstrated that Azerbaijan is taking significant measures to achieve its environmental objectives. These measures include the implementation of taxation, a reduction in CO 2 emissions by up to 55% by 2030, and a shift towards renewable energy sources. Our research aims to enhance the utilisation of renewable energy resources, increase the efficiency of the domestic energy infrastructure and implement measures to moderate high levels of unemployment and inflation, thus ensuring sustained economic growth in Azerbaijan.
... But the increase in the cost of extracting and transporting natural gas (OECD/IEA, 2011) and geopolitical conditions are more in favor of an upward trend. The need for an increase in European gas imports may increase the risk of European dependence on Russia (Bilgin, 2011;Yergorov and Wirl, 2011), while alternative gas supply options face a number of challenges: political instability or turmoil in countries that could supply EU-27 with natural gas like Turkmenistan, Iran, Egypt or Lybia; there is no coherent energy policy among European members and Russia is launching competing projects like South and North stream (Erdogu, 2010;Bilgin, 2011). In the light of the energy price outlook and the world nitrogen market, Weisz and Melhémy (2011) gave a 2012 and medium-term price estimate of 350 US/t, i.e., more than 3-fold higher that at the beginning of the decade. ...
... But the increase in the cost of extracting and transporting natural gas (OECD/IEA, 2011) and geopolitical conditions are more in favor of an upward trend. The need for an increase in European gas imports may increase the risk of European dependence on Russia (Bilgin, 2011;Yergorov and Wirl, 2011), while alternative gas supply options face a number of challenges: political instability or turmoil in countries that could supply EU-27 with natural gas like Turkmenistan, Iran, Egypt or Lybia; there is no coherent energy policy among European members and Russia is launching competing projects like South and North stream (Erdogu, 2010;Bilgin, 2011). In the light of the energy price outlook and the world nitrogen market, Weisz and Melhémy (2011) gave a 2012 and medium-term price estimate of 350 US/t, i.e., more than 3-fold higher that at the beginning of the decade. ...
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Abstract: European farmers are currently affected by an increase in the price of fertilizers (from an index of 100 in 2005 to 150 in 2012 after it peaked at almost 200 at the end of 2008) that calls into question the future availability of these kinds of inputs. Since 2007, the strong demand fromemerging countries, geopolitical tensions over natural resources, and the rise in the price of energy have been exerting upward pressure on the prices of mineral fertilizers that affect farmers production costs especially in the European Union, which is not self-sufficient in sources of NPK. Analysis of data from the Farm Accountancy Data Network shows that the cost of fertilizers increased from 80/ha in 2004 to 114/ha in 2011. Thisrise had the highest impact in 2009 because it was not offset by higher agricultural prices (the cost of fertilizers accounted for 5.4% of agricultural productionin 2009 and only 4.4% in 2011). The cost of fertilizers and its increase is particularly high for farms specialized incereal, oilseed and protein crops, andaccounted for 13.9% of agricultural productionin 2009.
... The relevant context here -the EU's conception of energy security -reveals a 'new' energy security agenda, combining the old concerns of security of supplies (amount, time, location) and price with new, wider environmental and social concerns (see Bilgin, 2011Bilgin, , p. 1083. The core principles of the Union's energy security conception have been reported elsewhere and occur in numerous EU policy documents since the 1990s security of supplies, markets and competition and sustainability (for example, Commission, 2006). ...
... However, only the United Kingdom, France, Germany and Italy attract the recognition of more than one neighbouring power (cf. Bilgin, 2011Bilgin, , p. 1086. This fragmented constellation further explains why society remains limited to a co-operative type in the external gas trade. ...
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This article explores energy security and integration within the European Union (EU) in the case of natural gas. It theorizes the underlying institutional dynamics of integration by drawing upon the English School as to how more deep-seated informal institutions condition policy-making by EU institutions and Member States as well as the operations of transnational actors such as energy companies. The informal institution of sovereignty constrains the push of the market institution towards a convergent type of integration. Together with the bilateral energy diplomacy and great power management institutions, sovereignty also limits integration in the external gas trade. Internal integration overall remains dependent on the wider European context as is also seen in the functioning of the environmental stewardship institution. The ambiguities among actors occasioned by the implementation of the Third Energy Package suggest a further integration need, but that is constrained by several further driving forces.
... For example, we can evaluate now some articles exploring the future using the suggested general scale above. In each case, a particular t is assumed and we use, for the analysis, σ = 4. Take, for example, Bilgin (2011) published it was a research on aspects of its shallow future. The original cone of plausibility proposed by Taylor (1988) goes up to its shallow future, as well the improvement of the cone suggested by Hancock & Belzold (1994). ...
... According to researcher Mert Bilgin, depending upon the priorities and strategies of the various stakeholders (which include amongst their number the European Commission, EU members, suppliers, and transit countries), Europe's security restructuring may take the following directions: 1) 'Russia first', in which the European commission and EU members prioritise gas from Russia; 2) 'Russia everywhere', in which Russia controls the natural gas market and offers supply routes to the Caspian, the Middle East, and Africa; 3) 'safety first', which follows from the concept of EU energy security and determines the EU's ability to benefit from the potential of natural gas; or 4) 'each country for itself', which involves the inability of the EU to achieve a common energy policy when EU members and EU partners pursue their own policies. Alternative European energy security policies can lead to different futures which are based on the relevant participants taking care of their own oil prices, ecological commitments, and strategic initiatives (Bilgin, 2020). ...
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This article analyses the energy dimension of relationships which have been developed between the ‘Eastern Partnership’ (EaP) partner countries within the context of European security. The essence of the EaP and the main priorities of the initiative’s energy platform will be determined. The peculiarities of their relations with the European Union and the Russian federation will be analysed. One discovery which has been made is the fact that the involvement of the addressee countries within the EaP grants them significant advantages in the implementation of the overall energy policy, and the EU is understood by them as being a guarantor of energy security. Emphasis is placed on the fact that Russia seeks to establish the fullest possible levels of control over energy supplies which are sent to Europe, and to the EU, and indeed even to reduce the dependence of the EaP partner countries on energy imports from Russia. Something which became obvious was the fact that while Georgia, Armenia, Moldova, and Ukraine were forming closer ties with the EU, Azerbaijan and Belarus on the contrary continued (and continue) to adhere to the authoritarian status quo. From this it can be concluded that the EaP partner countries face new challenges and threats, both in terms of domestic and foreign policy, which will determine the transformation of energy relations, in particular within the dimension of security.
... This diversification strategy has clearly been driven by the erratic nature of Russia and its ability to exploit gas as a geopolitical weapon. It has also resulted in increased pipeline connections with North Africa and consideration of the exploitation of resources in the Eastern Mediterranean (Bilgin, 2011;European Commission, 2013. However, the ability to tap into these sources depends on market prices, especially in terms of the extent to which they stimulate new field development. ...
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Infrastructure represents the core underpinning architecture of the global economic system. Adopting an approach informed by realism, this insightful book looks at the forces for the integration and fragmentation of the global infrastructure system. The authors undertake a thorough examination of the main internationalised infrastructure sectors: energy, transport and information. They argue that the global infrastructure system is a network of national systems and that state strategies exert powerful forces upon the form and function of this system.
... Applications. Similar to Delphi, scenarios are widely used in business planning (Godet and Roubelat, 1996;Ramirez et al., 2015), strategic decision-making (Miller and Waller, 2003;Varum and Melo, 2010), technology forecasting (Jiang et al., 2017;Narayanan and Fahey, 2006) and energy forecasting (Bilgin, 2011;Devezas et al., 2008). Scenario methods are also used to envision climate change (Cobb and Thompson, 2012;Hulme and Dessai, 2008), global political equilibria (Calleo, 1967) and socio-ecological futures (Wollenberg et al., 2000). ...
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Purpose – Current research methods for probing the future of markets and society rely mainly on expert judgment (i.e., Delphi), imagery or simulation of possible futures (i.e., scenario, simulation), and perspective taking (i.e., role-playing). The predominant focus on cognitive abstraction limits the insights researchers can extract from more embodied, sensorial, and experiential approaches. Drawing on embodied embedded cognition literature and the emerging consumer practice of live-action role-playing (LARP), we propose LARPnography as a more holistic method to probe the emergence of plausible futures. Design/methodology/approach – LARPnography is a qualitative method seeking to immerse participants within a plausible future to better understand the social and market dynamics that may unfold therein. Through careful planning, design, casting, and fieldwork, researchers create the preconditions to let participants experience what the future may be, and gather critical insights from naturalistic observations and post-event interviews. Originality/value – Different from previous foresight methods, LARPnography creates immersive and perceptually stimulating replicas of plausible futures that research participants can inhabit. The creation of a fictional yet socio-material world ensures that socially constructed meaning is enriched by phenomenological and visceral insights. Practical implications – Due to its interactive nature and processual focus, LARPnography is best suited to investigate the adoption and diffusion of innovation, market emergence phenomena, and radical societal changes, including the rise of alternative societies. Keywords – Futures and foresight, Embodied embedded cognition, Ethnography, Delphi, scenario, Live-action role-playing (LARP) Paper type – Methodological paper
... Månsson et al. [13] list main quantitative methods used for evaluating energy security; and several researchers address the use of indicators to measure the various dimensions of energy security [14,15]. Scenario planning is a wide-used method for security scholars [16][17][18] while the use of multi-criteria analyses has been sparse in the area. Worth mentioning are studies of Stirling [19], Lee et al [20], and Karvetski [21]. ...
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The objective of this research is to assess long-term energy security policy under uncertain environment. Uncertainty is an integral part of the energy policy analysis in long-term planning, in particular for energy-exporting countries seeking to secure sustainable export revenues. This study proposes a framework to evaluate energy export policy at the strategic level by addressing inherent uncertainties exist in energy-exporting countries. Seven criteria (political, economic, social, technological, legal, environmental, and robustness) are considered to appraise the identified energy export security alternatives. A new hybrid Multi-Criteria Decision-Making (MCDM) model is proposed based on intuitionistic fuzzy sets suitable for uncertain judgments that integrates Intuitionistic Fuzzy Analytic Hierarchy Process (IFAHP) and the Cumulative Belief Degree (CBD) methods. CBD, which is strengthened by IFAHP in determining criteria weights, allows experts to freely evaluate alternatives in various formats and can successfully deal with missing judgments by experts in case of doubt, eligibility or lack of information. Scenario planning is also incorporated into the decision-making process by determining four realistic projections. As a case study, the proposed framework is applied to analyze Iran’s energy export security. Results suggest that natural gas has the highest export priority while petroleum products (excluding gasoline) stand last in all scenarios.
... In light of increasingly difficult relations with Russia and the conflicts that emerged on the EU's northern and southern supply routes, natural gas supply diversification becomes ever more important (see for example Bilgin, 2009Bilgin, , 2011. One of the EU's strategies to improve supply security is to further develop the Southern Gas Corridor and a new gas hub in Southern Europe with additional quantities of natural gas coming from the Caspian, Central Asia, the Middle East as well as the Eastern Mediterranean (EC, 2016b). ...
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This paper analyzes the potential of Eastern Mediterranean offshore natural gas discoveries to increase EU natural gas supply security. It presents an overview of, the status quo of EU-28 natural gas import dependency, the efforts to increase energy security through various measures, and the challenges to supply diversification. It further provides an analysis of the energy and offshore resource sectors of Egypt, Israel, Cyprus and Lebanon. The paper presents projections of domestic natural gas consumption needs for the years 2012–2042 and results show that potentially large quantities will be available for exports. An empirical model is used to analyze the capital and transmission costs for exporting gas to Europe via the East Med pipeline. The East Med pipeline project is discussed in the broader context of other regional supply options as well as potential U.S. LNG exports to Europe. The paper concludes that the East Med pipeline, which has been classified as a project of Common Interest by the EU, should receive policy priority as its benefits in terms of security of supply go beyond those that can be captured in a competitive market, and the positive externalities that it provides justify a ‘security premium’.
... In light of increasingly difficult relations with Russia and the conflicts that emerged on the EU's northern and southern supply routes, natural gas supply diversification becomes ever more important (see for example Bilgin, 2009Bilgin, , 2011. One of the EU's strategies to improve supply security is to further develop the Southern Gas Corridor and a new gas hub in Southern Europe with additional quantities of natural gas coming from the Caspian, Central Asia, the Middle East as well as the Eastern Mediterranean (EC, 2016b). ...
... In terms of the first stream, both external factors (supranational or supra-regional) and internal factors (national or regional) were considered to investigate their influences on the NGSS in specific countries and regions. The considered external factors mainly include external supply sources [1,[14][15][16][17][18][19] and international gas price [20,21], while the internal factors include the households' willingness to pay for safeguarding NGSS [22], liberalization (e.g., legal governance and market regulation) [23], NG production [24], NG consumption [13], and civil unrest [25]. ...
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... A number of studies have analyzed natural gas supply systems in different countries, with most focusing on simulating the impact of a single factor on the system. These studies have examined economic factors (e.g., economic growth) [14][15][16][17][18], social factors (e.g., legislation and politics) [19][20][21][22][23], technical factors (e.g., improved mining technology) [24][25][26], and external environment factors (e.g., geopolitics of natural gas and international environment) [27][28][29][30][31]. There have also been some integrated studies, both quantitative and qualitative, that have analyzed the impacts of multiple factors on a natural gas supply system. ...
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... To apply a systematic and proven process of technology portfolio planning in Taiwan, Chen et al. (2009) constructed three scenarios (''Season in the Sun,'' ''More Desire than Energy,'' and ''Castle in the Air'') that encompass future uncertainties in the relationships between the technology alternatives and the decision values. Analysis of other long-term trends such as energy security, economics, energy supply and demand, geopolitical shifts, and social change has also been considered by scenario planners (Renn 2003;Guerra et al. 2014;Jiang and Hu 2006;Jewell et al. 2014;Bilgin 2011;Criqui and Mima 2012;Grave et al. 2012;Weldegiorgis and Franks 2014;Fortes et al. 2014;Tanatvanit and Limmeechokchai 2003). ...
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... Much more prevalent in this sphere are bilateral energy dialogues with Russia by Member States such as France, Germany, Italy and the UK, major energy importers with powerful energy companies and hence part of the calculations of the Russian Government and the main energy export companies of Russia (cf. Bilgin, 2011Bilgin, , p. 1086. ...
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... Examples of studies trying to understand the economic and environmental characteristics of an industry may be found in Martins et al. [35] for the Brazilian road haulage sector, Pagani [36] for the 3G wireless industry, Vivanco-Aranda, Mojica and Martínez-Cordero [37] for the development of the tilapia chain in Mexico Warth, and Von der Gracht and Darkow [38] for the electric vehicle industry. It is also worth citing other studies of this nature, such as those targeted toward development [39,40] and sustainable consumption [41], clean production [42], climate change [43][44][45][46], and especially those related to the energy industry [47][48][49][50][51][52][53], which have been gaining ground and becoming recurrent in the field of futures studies. ...
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States and markets are key to energy policy and as such belong to the very core of energy policy analysis. How exactly they are linked is always an empirical puzzle, the solving of which depends on time and geography. As the contributions to this book indicate, it matters where we are. For example, in post-Lisbon Treaty Europe the energy policies of EU member states are slowly but painfully converging as a result of supranational regulation initiated by the member states, forcing more competition among energy market actors. In Asia, by contrast, market actors mostly face regulation by state-level institutions, with emerging sub-regional integration mostly led by multinational companies.
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Primary energy sources exhibited regular long-term logistic substitution trends from the mid-19th century through the third quarter of the 20th century. This analysis, based on an extension of the Fisher–Pry substitution model, accounted for the observed historical shifts of primary energy use from sources of wood, coal, oil, natural gas, and nuclear. In the mid-1980s the substitution dynamics was replaced by a relatively constant contribution from oil, natural gas, coal, nuclear power, and hydropower. However, a major factor in energy use dynamics in this recent period was substitution of conservation and efficiency for actual fuel use. The energy efficiency is measured as the ratio of economic activity to the rate of energy use (energy intensity). To incorporate these data into the logistic analysis, a method for estimating the fraction of energy saved by the increased efficiency was used. With this interpretation, energy efficiency fits within the substitution model. Furthermore, to identify indications of future energy scenarios, as well as to test the logistic substitution analysis, another statistical approach using ternary diagrams was developed. The consistent results from both logistic substitution and statistical analysis are compared with recent energy projections, trends in decarbonization, Kondratieff waves, and other efficiency measures. While the specific future mix of renewables and nuclear energy sources is uncertain, the more general logistic dynamics pattern of the energy system seems to be continuing as it has for about 150 years now.
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Using the so-called Transition Paradox for methodological renewal in futures studies, this article derives one paradox plus six dilemmas. The analysis concludes that methodological renewal should be embedded in the renewal of science. The power of new paradigms depends on how much they serve the long run welfare, stability and existence of the whole world population. Methods — and the breakthrough strategies of the East-Central European countries — are intended not only for outlining visions, but also for creating their technological, institutional and other foundations so that they do not remain merely utopias.
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This paper hypothesizes that analyzing the geo-economic and energy security characteristics of gas supplies to Europe may help in understanding the features of regional and international relations with regard to selected countries. The paper highlights the significance of natural gas in the New Energy Order, and points to the importance of supply security for the EU. It looks at Russia, Azerbaijan, Turkmenistan, Kazakhstan, Iran, Iraq, Egypt, Libya and Algeria as suppliers and Turkey as a transit country in an emerging gas corridor to Europe. It examines supply-side opportunities, which promote new fields of international cooperation based on gas trade, and addresses certain restraints that may reduce the likelihood of further regional cooperation. Economic and geographic factors create new opportunities for regional trade and international relations. This geoeconomic aspect, however, takes place with international security issues varying from case to case.
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The focus of this book is the implications of EU enlargement in May 2004 for EU-Russian relations. How should the EU and Russia develop their priorities as neighbours? What role could Russia's border regions play in shaping this policy? The book looks at the array of political, security, economic, and social concerns raised by the enlargement process. It incorporates different perspectives from existing and new EU member states, Russian scholars and politicians from Moscow and the northwestern regions of Russia. © 2005 Oksana Antonenko and Kathryn Pinnick for selection and editorial matter; the contributors for individual chapters. All rights reserved.
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This article considers the use of systems methodology in futures studies and foresight, in relation to Slaughter's call for Integral methodological renewal in futures studies. The diversified methodologies that have developed within the systems practice field over the past 25 years are examined for their potential to address concerns about the field's reduction of interior realities to epiphenomena of systemic processes, articulated by Habermas in the 1970s, and more recently by Wilber from the perspective of his Integral Methodological Pluralism. It is argued, though, that Integral methodology requires more than methodological pluralism: some understanding of the structures of consciousness within which methodologies are conceived and applied is needed. Drawing on the work of Dr. Susanne Cook-Greuter, capacity to understand “system” itself is explored, looking at the way that humans make sense of reality and the stages through which this sense-making develops. It is argued that systems methods and tools used with sufficient practitioner awareness of epistemological biases have an essential role to play in improving the quality of our futures perception and knowledge.
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This article reveals the evolution of the concept of energy security with a particular focus on the challenges of the 21st century and develops the author's concept of the new energy order (NEO). NEO defines the basic premises of energy security within a broad context and aims to respond to the challenges and dilemmas arising from the transition to desired energy mix systems. The article discusses the basic characteristics of the global shift to a complex system of energy mix in which carbon fuels, nuclear energy, renewables (and newly emerging alternatives such as hydrogen) play significant roles. The narrow understanding of energy security (based on amount, price, location, and time) is then transformed to a broader understanding (with environmental and societal concerns) which is argued to be more relevant for the defined challenges. Having elucidated the NEO, the article introduces feasibility, accessibility, sustainability and transparency (FAST) as the global principles which are necessary to attain an equitable and a sustainable new energy order.
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This paper addresses issues of natural gas which raise questions about European energy security. It first focuses on the rising gas demand of the EU27 and elaborates alleged risks of dependence on Russia such as Gazprom's disagreement with Ukraine, which became an international gas crisis in January 2006 and also more recently in January 2009. Incentives and barriers of Europe's further cooperation with selected Caspian (Azerbaijan, Kazakhstan and Turkmenistan) and Middle Eastern (Iran, Iraq and Egypt) countries are discussed. Supplies from Caspian are analyzed with a particular focus on Russia's role and the vested interests in the region. Supplies from the Middle East are elaborated with regard to Iran's huge and Iraq's emerging potentials in terms of natural gas reserves and foreign direct investments in the energy sector. The geopolitical analysis leads to a conclusion that the best strategy, and what seems more likely, for the EU is to include at least two countries from Azerbaijan, Turkmenistan, Iran and Iraq within its natural gas supply system.
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European countries employ different strategies on gas supply security depending on the time scale: while their short-term strategies focus on economic efficiency, long-term strategies also place more emphasis on ensuring energy security. With regard to short-term natural gas procurement strategies, each country places priority on ensuring immediate economic benefits. Furthermore, these strategies are led by enterprises, and no explicit government intervention can be detected. While its natural gas procurement focuses on economic efficiency in the short term, Europe has developed strategies that emphasize not only economic efficiency but also ensuring supply security with regard to medium- to long-term procurement. The EU, Britain, Germany and France differ in their strategies to ensure supply security, but what they have in common is that they all have a clear policy as to how to cope with their growing dependence on Russia. This is believed to be a result of European countries’ engaging in very deep discussion and consideration over their supply security. Japan, which is also an energy importing country like countries in Europe, can learn a lot from major European countries’ gas supply security strategies in considering its own security policy. As Europe has done, Japan should also accelerate efforts toward ensuring future energy security from a medium- to long-term perspective, in addition to immediate short-term strategies.
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This paper discusses prospects for increased consumption of natural gas within the European Union (EU) up to 2030. Particular emphasis is on the power generation sector, where the main growth in demand is expected to occur, on supply and infrastructural constraints and on future price of natural gas.It can be concluded that EU gas-import needs will increase substantially up to 2010, driven by a combination of rapid increase in demand in southern Europe and declining production in northern Europe. As a result there will be an increased import dependency which will affect security of supply, not only in the gas sector but also in the electricity sector. Gas demand after 2010 will partially depend on the level of continued CO2 emission restrictions, a possible nuclear phase-out in the UK, Germany and Belgium and to what extent the option to store CO2 in subsurface reservoirs will be applied. However, supplies of gas are plentiful, at least in the medium-term up to 2010/2015, and a number of new countries will emerge as substantial suppliers to the European gas market, increasing competition and possibly leading to a situation of oversupply between 2008 and 2012 which in turn may create a downward pressure on gas prices. In addition, the US market may, pending on demand and indigenous production, experience considerable oversupply between around 2008 and 2015, reducing the possibilities of conducting arbitrage between the two main markets in the Atlantic basin and further contributing to a downward pressure on the gas price. On the other hand, the oil price will continue to be a major determinant of the gas price and a tight oil supply/demand balance will create an upward pressure on the gas price. Global liquefaction and regasification capacity is expected to more than double between now and 2010 leading to a more flexible and global gas trading and increasing spot sales and although the cost of LNG has decreased substantially over the past three decades it is still more costly than piped gas at distances up to 3000—4000km within comparable regions. Thus, an increased use of LNG will contribute to an increase in average gas prices locally. Problems related to gas production capacity together with abundant supply to the EU markets and increased competition points to that Russia will loose market share in the short run, in particular as piped Russian gas is not competitive on the main growth markets, i.e. UK, and Italy/Spain. Nevertheless, in the long run, it can be expected that the EU dependency on gas from Russia as well as on the Middle East will increase. The vulnerability in supply security and the high dependency on Russian gas has been highlighted by the latest events (January 2006) with Russia cutting supplies to Ukraine.A critical factor is the large and timely investments required along the entire fuel chain in order to meet rapidly increasing demand, often in regions with uncertain investment conditions. Also, the producing countries are likely to invest according to national interest rather than to supply an increasing global demand.
The 4000 km. Trans-Saharan pipeline will traverse Nigeria, Niger and Algeria to reach European markets via Italy by 2015–2016. The initial capacity of 20 Bcm will be increased to 30 Bcm by 2030. (1) Stalled negotiations to renew the expired EU–Russia Partnership and Cooperation Agreement
  • From Nigeria
From Nigeria: The 4000 km. Trans-Saharan pipeline will traverse Nigeria, Niger and Algeria to reach European markets via Italy by 2015–2016. The initial capacity of 20 Bcm will be increased to 30 Bcm by 2030. (1) Stalled negotiations to renew the expired EU–Russia Partnership and Cooperation Agreement (1997–November 2007).
economic scenarios are matched up with policy scenarios. The matrix results in 16 contingencies with meaningful clusters of four economic and four policy cases
  • Finally
Finally, economic scenarios are matched up with policy scenarios. The matrix results in 16 contingencies with meaningful clusters of four economic and four policy cases.
European strategies on gas supply security, The Institute of Energy Economics Japan (IEEJ) -IEE Japan
  • K Fujishima
K. Fujishima, European strategies on gas supply security, The Institute of Energy Economics Japan (IEEJ) -IEE Japan (October) (2009) 2–3.
The Nord Stream (55 Bcm) will reach Germany through Baltic Sea. The proposed South Stream (60 Bcm) will pass through Black Sea to transport gas to Bulgaria
  • From
From Russia: The Nord Stream (55 Bcm) will reach Germany through Baltic Sea. The proposed South Stream (60 Bcm) will pass through Black Sea to transport gas to Bulgaria, Austria and Italy.