To quit Russian gas and oil, a green-transition jubilee

Europe must exit from its dependence on Russian fossil fuel by designating the next year as one of state-financed domestic conversions.

Russia’s invasion of Ukraine has forced the European Union finally to face its long-term dependence on Russian gas and oil. And the implication is clear: the EU must extract itself now. But as it prepares to undertake a swift, state-led energy rethink—an undertaking only conceivable in a wartime framework—the crucial question is whether decision-makers will lean into the green transition or fall back on conventional fossil-fuel solutions.

The European Commission proposal issued on March 8th, REPowerEU, presents this fork in the road as a non-choice. Given the degree to which member states are locked into fossil-fuel sources, the commission sees only one short-term solution, which is to stock up on gas and oil (much of it from Russia) while negotiating delivery from third countries for next winter.

Meanwhile, of course, the green transition should be ramped up to accelerate electrification and energy efficiency. But the commission does not expect the effects to kick in before 2030. In a narrow sense, its proposal is thus ‘business as usual’, following the pathway already established by the European Green Deal.

With REPowerEU on the table, greens on the one hand and conservatives on the other will debate the pressing need for a green transition versus the Realpolitik of territorial defence. The opposition between the two is however false.

Strategic vulnerabilities

What Europe should learn from the invasion is that its dependence on Russian fossil fuel represents not only a geopolitical risk. European policy-makers should also pay careful attention to the strategic vulnerabilities centralised energy systems present for the Ukrainians. By seizing Europe’s largest nuclear power plant in Zaporizhzhia, the Russian army was able in a single move to take control of a significant portion of Ukraine’s generating capacity.

The same could happen in EU member states, even without Russian troops setting foot on their soil. Russia has already demonstrated its capacity to hack power plants in the west, while physical supply chains from third countries are easy targets. Imagine a Europe, without gas and oil from the middle east, where power plants could be switched off at the whims of a foreign adversary. How long would the EU be able to withstand such pressure politically without ceding to Russia’s demands, whatever those might be?

When scientists in the United States collaborated with the army to invent the internet (strictly, the concept of packet-switching network nodes), it was precisely to counteract such vulnerability in communications. Until the late 1960s, the infrastructure paradigm had been to route all government and military telecommunication through a few central switches, which were big, advanced, expensive and flawless—but highly vulnerable.

The RAND Corporation warned that the Soviet Union could take out the entire US communications infrastructure with only a few strategically aimed weapons. The solution was radical decentralisation—a widely distributed network of small, primitive, cheap and fallible nodes, communicating through a packet-switching protocol, which no number of targeted explosions could ever eliminate.

Decentralised infrastructure

Transferring this thinking to the European energy grid is the only viable short-term solution to the strategic vulnerability exposed by the Ukraine invasion. Europe must embark on the rapid creation of a radically decentralised energy infrastructure, to supplement the existing system and provide resilience in territorial relations.

The model is well-known and simple. There should be solar panels and a small-scale wind turbine on every roof in Europe, charging stations and electric cars in every driveway and at every parking space, a ‘smart’ electricity grid to level out consumption during the day and between regions, and a clear policy prioritising essential over non-essential energy use.

Other means which will take longer, such as zero-carbon homes, intercontinental electrical trains and fossil-fuel free flying, would enhance the robustness of the system. But the first steps towards greater resilience could be done by 2023.

Danish experiences show that home owners’ and car owners’ enthusiasm for making the green transition tends to be much higher than the authorities assume. The real question is not what to do and whether citizens will go along: it is how to pay for the rapid transition.

When the European Council convenes at the end of this month, it should declare a green-transition ‘jubilee’—a mandate mobilising everyone owning property and vehicles to electrify them within a year. This would come with a commitment that the EU and its member states would provide the necessary infrastructure, clear away any regulatory obstacles, ensure a fair price for the energy produced and, most importantly, pick up the tab for the initial investment.

State financing

That is, of course, the crux. State financing of a swift green transition is legally possible under the national-security exceptions to state-aid rules—if the council adopts a temporary framework to widen the interpretation by the Court of Justice of the EU of articles 346 and 348 of the Treaty on the Functioning of the European Union.

It is economically feasible with a view to the Keynesian positive-feedback loops it would create, in terms of enhanced demand, if European producers are privileged in the process. And it is financially practicable through state-backed loans or direct subsidies (especially if these are then sold on private securities markets).

The missing ingredient, which only the heads of state can provide, is the political leadership needed to wield the powers of wartime with such confidence.