The EU Needs a New Arctic Strategy
| Published date | 01 February 2016 |
| Date | 01 February 2016 |
| DOI | http://doi.org/10.1111/1758-5899.12285 |
The EU Needs a New Arctic Strategy
Vicente Lopez-Ibor Mayor
Estudio Juridico Internacional (EJI)
The EU is the world’s largest energy importer and one of
the largest energy consumers. Its continued dependence on
foreign energy, coupled with recent tensions with its big-
gest supplier –Russia, over the Ukraine conflict has meant
that the EU’s energy security has become more fragile of
late. But the underlying reality of the EU’s current energy
challenges lies partly with its failure to take more decisive
action to harness the benefits of the Arctic region. The Arc-
tic after all is home to 22 per cent of the world’s natural oil
and gas and higher temperatures have created safer condi-
tions for energy exploration. In order for the EU to address
its core energy vulnerabilities, it must engage with the Arc-
tic more robustly as a means of significantly diversifying its
energy sources and security.
Key challenges for fossil fuels in the near future
The conventional fossil fuel industry is anticipating major
challenges in the coming decades. While estimates vary,
industry figures and independent experts have generally ear-
marked 2030
1
as a key period in the life cycle of fossil fuels,
both in terms of economic sustainability and depletion. The
National Petroleum Council in the US, warned of these chal-
lenges in its report calling for energy exploration in the Arctic,
citing forecasts from the Energy Information Administration
on projected production declines in conventional fossil fuels
in the US. In Russia, Europe’s largest and most important
energy supplier, sustainability of energy production is also
expected to hit a ceiling in the 2030 period
2
, while Britain’s
North Sea oil reserves are expected to deplete within a dec-
ade, with a very similar outlook for Norway.
Unconventional energy production such as shale is
expected to face similar challenges even sooner in the US
as shale depletes far quicker than natural reserves and is
more expensive to extract. The International Energy Agency
predicts that shale output in North America will begin to
level off in 2020, irrespective of what the price of oil will be
at the time. The energy reserves in the Arctic will become a
practical necessity after this point. For the EU, this is particu-
larly important because its energy security is no where near
rivaling North America.
The rise of renewables
Renewable energy has emerged as a dominant source of
energy in the last decade, and is often referred to as a pos-
sible alternative that can alleviate the pressures and uncer-
tainties of fossil fuels. Fears about the irreversible impact of
climate change has also influenced the EU’s commitment
towards renewable energies and reduction of fossil fuels.
There is no doubt renewable energy has made major
breakthroughs and is now a permanent feature of the
world’s energy infrastructure; after all renewables electricity
now has a market share of 22 per cent, double that of
nuclear energy.
3
Its market share is expected to increase
and costs will continue to come down, new technological
innovations will also continue to emerge in the renewable
energy industry to address challenges related to storage,
intermittency and smart grid systems. The EU must actively
pursue renewable energy as a way of diversifying energy
and strengthening energy security.
Despite the successes of renewables, challenges still
remain in the short-term. Recent advancements in storage
solutions and microgrids are expensive. But more impor-
tantly, renewable energy generation cannot account for all
energy consumption, at least for the foreseeable future. The
modern world still needs fuel based energy resources, parti-
cularly for industries like heavy transportation. It is quite an
achievement that up to 60% of global transportation can
currently be electrified.
4
But that still means that the world
still fundamentally requires fuel based energy systems for
crucial industries that cannot be replaced with electrifica-
tion. No such commercially viable alternative fuel system
exists at present, and as the world becomes more and more
disenfranchised with nuclear energy in the aftermath of the
Fukushima disaster, Arctic energy is likely to emerge as a
key priority for the biggest energy consumers.
The EU’s Arctic double act and why it has not
worked
It is within the context of the aforementioned challenges
that the future of the Arctic energy reserves should be
understood and approached. The heightened activity in the
Arctic region is very much reflective of these changing
dynamics, which are underpinned by the increased
assertiveness of the major economies and energy con-
sumers in the Arctic region. Arctic countries such as Russia,
Denmark, Canada and Norway, as well as nonArctic coun-
tries such as China and India, have moved to make a notice-
able presence in the region with their objectives firmly set
on exploiting the energy riches of the Arctic region.
The EU however, has adopted a different approach. As a
highly sophisticated supra-national organisation, the EU has
struggled to create consensus and assert itself in the Arctic
region as dominantly as some other major economies have.
Global Policy (2016) 7:1 doi: 10.1111/1758-5899.12285 ©2015 University of Durham and John Wiley & Sons, Ltd.
Global Policy Volume 7 . Issue 1 . February 2016 119
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