LONDON, June 5 (UPI) -- As the world's energy resources diminish ever more rapidly, the question of how to keep the lights on is rocketing up the political agenda to become one of the key international security issues of the age.
British government and industry figures Monday delivered a blunt warning against the current trend towards national protectionism in the race to secure future energy supplies. Calling for greater liberalization of domestic markets and increased international cooperation, they cautioned that the pursuit of narrow national interests would undermine energy security and result in international conflict.
European energy ministers are to meet Thursday to discuss the content of the Common Energy Policy for Europe, nominally agreed at March's EU summit. But despite growing awareness of the need for a cohesive pan-European energy strategy, prompted largely by the Russia-Ukraine gas crisis in January, rows over national protectionism are threatening to scupper progress.
Speaking at a London meeting hosted by international affairs think tank the Foreign Policy Center, British Energy Minister Malcolm Wicks said the Russian suspension of gas supplies to Ukraine during a row over prices -- with knock-on effects for several European nations -- had plunged the bloc into a crisis of confidence.
"A shiver went down the energy spine of Europe," he said. "That has led to the reemergence of the idea of national security, national champions; it was a fright which we're still trying to think through."
While the European Commission -- the EU's executive agency -- is strongly in favor of liberalizing EU energy markets and developing a common energy grid, many European capitals are moving to create national champions to ward off international competition. Perhaps the most prominent example is the proposed merger of the French utility Suez and the state-owned Gaz de France, a deal brokered by Paris in order to fend off a potential hostile bid by Italy's Enel; however similar consolidation maneuvers are taking place across the continent.
"At the national level, people are still seeking to build fortresses of their own," said Roger Carr, chairman of British energy utility Centrica. Nailing down a common EU energy policy was vital to prevent a return to a protectionism which would harm the European economy and undermine energy security, he said, adding: "A European oligopoly is not the solution to a producer oligopoly."
This trend is not simply confined to economic policy, according to analyst Nick Mabey, formerly senior adviser in the prime minister's Strategy Unit.
The current global trajectory towards state ownership of assets was threatening to lead the world towards "a very bad place," he said, arguing that it was in Europe's interests for the energy system to remain market-based.
"Geopolitical conflict for ownership of assets is not the world we want to live in," he said. "It's probably the most dangerous thing going on in global politics at the moment."
Mabey said China was currently considering whether it could meet its energy needs through economic and diplomatic means or whether it should build a navy and "go the hard power route," partly in response to the United States' construction of military bases next to oil wells the world over.
"In a sense, Europe's sitting there facing these two people who are playing this game of bridge across the world, signaling to each other and feeling very suspicious of the motives of each others' military planners.
"Europe needs to build a more cooperative framework because we're not really playing in that game, we're not putting European military bases next to anywhere, and we're not doing any of these sweetheart strategic long-term deals on energy as India, China and the U.S. is doing."
"It's a very very dangerous issue," he said, warning that once energy security had been defined in national security terms it would be impossible to turn it back into a normal economic concern.
"It is the next 10 to 15 years where we could go down that road. It won't secure anybody's energy, it certainly won't secure the climate, it will have lots and lots of nasty foreign policy and conflict side effects.
"But we're quite capable of stupidly choosing that route, because everybody's acting in their short-term national interests without talking to each other. Who's going to broker the conversation? Is it Europe?"
Wicks said consumer countries had to improve dialog with producer nations, noting that the latter had concerns, such as security of demand, which were often not recognized. In perhaps a tacit reference to U.S. Vice President Dick Cheney's recent war of words with Russian President Vladimir Putin, he said consumer nations had to be "a little bit more humble and sensitive" as to how Russia, OPEC and other producers saw the energy world.
However countries concerned about security of supply could engage in some positive energy nationalism by investing in renewables and energy efficiency, he said. There was nothing inevitable about Britain and other European nations becoming as dependent on foreign imports as current projections suggested, he continued.
"There are things we can do on the demand side as well as the supply side," Wicks concluded, adding: "We talk about these precious resources, scarce resources, and we waste a hell of a lot of it really."
