EAST EUROPEAN ASSOCIATION FOR THE DEVELOPMENT OF THE HYDROGEN ECONOMY’s Post

🇺🇦🇪🇺Ukraine's European integration and alignment with the single European market will significantly enhance the country's energy security, unlock new economic opportunities through electricity trade, and boost the overall competitiveness of the Ukrainian economy.   ✅Market participants benefit from healthy competition and transparent market rules.   ✅Ukrainian consumers, in turn, will have the same rights as European consumers to fair pricing for electricity and the opportunity to make a more informed choice when choosing services and suppliers.   ✅Increasing competition among suppliers will force them to offer more favorable conditions to consumers. In addition, consumers will have the opportunity to engage directly or indirectly in the electricity market and benefit from its operation.   🔋Given that the energy sector is the backbone of a functioning economy, the synchronization of Ukraine's energy systems with Europe paves the way for deeper cooperation and is a critical step towards full EU membership.   🔗Read more: https://lnkd.in/dshV_dc3 [This article is published in Ukrainian. To access it in English, please use the translation feature in your browser.] Fatih Kölmek, MSc, PhD

Central Asia’s Middle Corridor Comes Closer to Realization   At last week’s 8th Annual Trans-#Caspian Forum, organized by the Caspian Policy Center in Washington D.C., some of the world’s most authoritative experts on #CentralAsia’s #geoeconomics and #geopolitics gathered to discuss vital issues.   At the top of the agenda? The Middle Corridor. This transit route from Central Asia to the West via the Caspian Sea and the #Caucasus via #Azerbaijan and #Armenia has the potential to cut #Russia out of #Europe’s #energy equation as a transit country, reducing its leverage and funding used in #Ukraine.   Long recognized as a desirable, it wasn’t until February 2022 that the Middle Corridor was actually prioritized with capital and construction. The work on port infrastructure in Western #Kazakhstan and Azerbaijan, as well as the real possibility of undersea connections with #Turkmenistan’s gas, are encouraging signs.   I was very happy to discuss these issues with local media from Kazakhstan and offer an outsider’s perspective on the issue, as well as more information on the specifics of financing, and #China.   Please read more at:   https://lnkd.in/e3JX6XVK      

Electricity trade with the EU enables Ukraine to strengthen its energy security and provide opportunities for emergency assistance. The integration of markets allows the optimization of available generating capacities, reduces overall system costs, and increases operational efficiency. Thanks to the strengthening of connections between networks, coordination, and joint use of resources (electricity and auxiliary services), the reliability and stability of the electricity supply to consumers. Implementing the best European legislative practices opens up additional opportunities for Ukrainian consumers to a broader choice of suppliers, better quality of service, and fair market prices for electricity thanks to transparent competition. The internal Ukrainian market will operate according to standard European rules and become more attractive to investors. Read more: https://lnkd.in/d5EHfUwE [This article is published in Ukrainian. To access it in English, please use the translation feature in your browser.]

Neftegaz.ru provides a summary of energy sector matters raised during Putin's visit to Beijing this week. Here's a summary focused on the #PowerOfSiberia2 gas pipeline project and the #NorthernSeaRoute (#NSR). On #PoS2, Putin made comments after a visit to Harbin Polytechnic University. Despite many years of negotiations with China on gas supply via #PoS2, "the issue remains in limbo". However, the decision to build #PoS2, as part of #Gazprom's 'Eastern Gas Supply System', which will unite the eastern and western gas transmission systems, has already been made in Russia. It is planned to unite the eastern and western systems by 2030-2032; #Gazprom has already begun design and survey work. Putin commented: - I’m not ready to talk about the technical details, but the strategic interest on both sides in the implementation of this project has been confirmed: on the one hand - in obtaining additional volumes of gas, on the other hand, in the sale of gas on the Chinese market; - Because the Chinese economy is growing, it requires an increase in energy resources, which are necessary to support this growth; - The obvious thing is that there is nothing more reliable than supplies from Russia; - We have a huge common border and no one will interfere here - neither #sanctions against the tanker fleet, nor #sanctions against financial institutions (we will buy and sell everything in national currencies); - This is always a complex process, but I think that economic operators will certainly agree; - The question is prices, who will earn how much; - There are different routes, one of them is through Mongolia, and in one corridor it is possible to lay both a gas pipeline and an oil line; - The specialists must decide what is best to do; - You can have a tanker fleet and establish supplies along the #NorthernSeaRoute (#NSR), almost like a pipeline; - All options are possible, they are all acceptable and economically feasible, you need to choose the best one; - I am confident that this work will be completed. Putin did not explain how it would be possible to assemble a fleet of Arc 7 ice-class carriers to supply #LNG along the #NSR. It is the lack of such #LNG carriers that is forcing #NOVATEK to postpone the start of #LNG shipments from the #ArcticLNG2 Project, which is being hindered by US #sanctions. The delivery of Arc 7s built at South Korea's #HanwhaOcean Shipyard for the project remains very uncertain, and the fate of similar vessels built at the #Zvezda Shipyard in the Russian Far East is also unclear. Russian-Chinese cooperation on the #NSR is covered in a comment below. https://lnkd.in/gjJQRhAD

The United States has demonstrated that a comprehensive clean hydrogen support strategy is not just about sustainability—it is about new economic opportunities, industrial transformation, and geopolitical competitiveness. Ukraine has a unique chance to leverage this experience by integrating hydrogen technologies into its energy recovery and development. However, achieving this requires clear regulations, government incentives, and a strategic vision that goes beyond traditional energy policy. https://lnkd.in/ehHmnCUc

A brief update on the #PowerOfSiberia2 gas pipeline system and #Rosneft's Arctic mega-project #VostokOil. While in Astana, Kazakhstan, Russian Deputy PM Aleksandr Novak said that Russia and China intend to agree on the terms and parameters of the contract for gas supplies via the #PowerOfSiberia2 [#PoS2] gas pipeline to the PRC "as soon as possible". Novak noted: - [The issue of signing the contract] was discussed [during the visit of Russian President Putin to Astana] and supported; - Work will continue in order to agree on conditions and parameters; - Instructions were given to do this as soon as possible. The planned export capacity of the so-called Western route [#PoS2) is 50 billion m3/year of gas. Negotiations with China on the contract continue, but the decision to construct the #PoS2 pipeline within the framework of the Eastern Gas Supply System, which will unite Russia's eastern and western gas transmission systems, has already been made in Russia. Novak said that it is planned to combine the eastern and western gas transportation systems by 2030-2032, and #Gazprom has already begun design and survey work. In December 2023 it was reported that the terms of construction of the gas pipeline had been finalized by #Gazprom and China's #CNPC. Survey work is underway to lay a section of the pipeline through Mongolia, known as Union East. Putin also stated that the planned #PoS2 route through Mongolia makes it possible to lay an oil pipeline in the same corridor. With regards to the #VostokOil Project, Novak said that Russia and China are studying the possibility of Chinese companies participating in the project, and in July 2024 the issue will be discussed at the business level: - This issue was discussed at previous meetings; - A Russian-Chinese business forum will be held in July; - I think that [businesses there] will discuss [this possibility] in detail at the company level. #VostokOil is #Rosneft's flagship project, located in the East Siberian Arctic. It includes 52 license blocks in the north of Krasnoyarskiy Territory and 13 in the Yamal-Nenets Autonomous Okrug. https://lnkd.in/gkmCPJib

Ukrainian expert: Kyiv needs to maintain gas transit for its gas supply. Maintaining gas transit through the Ukrainian GTS will help maintain pressure in the system, and thus ensure uninterrupted supplies and, ultimately, stability of gas prices. Kyiv should not stop gas transit through its lands in order to maintain uninterrupted supplies to all corners of the country in the future and not provoke price increases, believes Yuriy Korolchuk, an analyst at the Institute of Energy Strategies of Ukraine. According to him, Ukraine needs at least minimal gas volumes to transit through it, as now - up to 20 billion cubic meters. Otherwise, the pressure in the system will be low, and the price for the supply and distribution of blue fuel will increase, he said. There is logic in these words, because if the pressure in the Ukrainian GTS drops, additional infrastructure will be needed to pump to remote areas, new compressor stations, for example. They need to be built, and these are costs that will certainly be passed on to consumers, as well as time, and the heating season is near. At the end of 2019, Moscow and Kyiv agreed to extend the contract for the transit of Russian gas through Ukraine for another four years - until 2025. According to the contract, the Russian Federation supplied 65 billion cubic meters of gas through Ukrainian lands in 2020, and another 40 billion in the next three years. Kyiv refuses to extend the contract after 2024, noting that it has not yet terminated it only because of the Europeans, to whom this gas is supplied. But after the end of 2024, Kiev does not intend to extend the transit contract or sign a new one with Moscow, which it has repeatedly stated. It is also unclear what will fill the Ukrainian GTS if supplies from the Russian Federation cease. Naftogaz says that it will develop its own production and export to the EU, but it is hard to believe in this. There is an option to replace Russian gas with Azerbaijani gas, but so far it has not been possible to agree with Baku, and it will still be necessary to agree with Moscow: with such a scheme, Russia will become a transit country. https://lnkd.in/gkkDijHx

https://lnkd.in/dQteJQkj NO GAS TO EUROPE The European Union welcomes the winter of 2024/25 with serious challenges posed by the energy crisis provoked by the Russian invasion of Ukraine. The cold autumn led to record gas production from underground storage facilities, leaving the level of reserves at just 86% at the beginning of December - the lowest in the last three years, writes the BBC. Despite the alarming data, experts assure that Europe will not be left without gas this winter. More than 100 billion cubic meters of gas have been prepared for the current heating season, which represents about a third of the EU's annual consumption. "The available reserves are quite sufficient, even if the winter is colder than usual," assure analysts from the Oxford Institute for Energy Studies. However, they emphasize that the gas consumed will have to be replenished in the summer of 2025, when demand is traditionally lower. High gas and electricity prices continue to cause serious damage to the European economy. Germany, the EU's leading industrial power, has been particularly affected. Companies such as Thyssenkrupp, Volkswagen and Ford have announced layoffs and plant closures.

The European Union is stepping up measures to wean itself off energy supplies from Russia. The European Commission has listed measures that, in the opinion of Europeans, help to wean itself off Russian energy supplies. The European Commission has listed a set of measures that, in its opinion, help the EU reduce its dependence on Russian oil and gas. Thus, EC representative Tim McPhee was forced to answer journalists' questions about what Europe needs to do to prevent an increase in gas supplies from Russia in 2024, which, based on the current rate, could exceed the 2023 level. McPhee assured that Europe is greatly helped by renewable energy and the redistribution of energy flows. And sanctions against Russia are worsening the situation of its fossil fuels in the European region. According to McPhee, Europe is also using a number of other existing tools that help reduce the presence of Russian hydrocarbons in European markets. In particular, gas legislation has been revised, allowing European countries to use national restrictions against Russia - apparently, this is about the ability of EU countries to prohibit access to their gas pipelines by suppliers from Russia and Belarus (which no one has used after it was put into effect). In addition, money is being invested in the joint infrastructure of EU countries, which will allow partner countries to help each other in difficult situations. https://lnkd.in/ewUT7c2p

Kyiv will lose money: EU refuses Ukrainian gas storage facilities. Ukrainian underground gas storage facilities are becoming less and less attractive to European companies due to their low price, as they fear that they will not be able to return the gas from there. Europeans are refusing Ukrainian UGS facilities because of Russian attacks, they are simply afraid that they will not be able to return the gas from there, writes the Financial Times. The trend of reducing the volumes of European gas in Ukrainian storage facilities was fully demonstrated this summer. Despite the fact that Ukraine owns the largest UGS facilities in Europe, the reserves in them are clearly decreasing due to the refusal of European enterprises to use such services. The total capacity of underground gas storage facilities (UGS) in Europe is 100 billion cubic meters, and the EU needs 350-500 billion cubic meters of gas to get through the heating season - it all depends on the weather. Ukraine offered European companies 10 billion cubic meters of its 30 billion cubic meters of capacity, and last year Europeans stored 2 billion cubic meters in Ukrainian UGS facilities. However, after the Russian Federation's attacks on energy infrastructure facilities in the country, the situation changed. According to Argus, in the first months of summer, European companies pumped gas into Ukrainian underground gas storage facilities at 15.4 million and 51.9 million cubic meters, while in June-July 2023 it was at the level of 102.7 million and 586.6 million cubic meters, respectively. In addition, gas prices in the EU have also fallen. If last year the benefit of storing gas in Ukrainian underground gas storage facilities was about €20 per 1 MWh, now it has dropped to €5. Analysts explained to the FT that with such a benefit, EU companies do not want to risk sending their gas to a war zone: it will not disappear from underground, but it is impossible to pump it out at the right time if the above-ground storage infrastructure is destroyed. So traders need additional incentives to take risks. Bank guarantees could be such. But according to calculations by a senior EU official cited by the FT, Kyiv could receive 200 million from European traders, but the guarantee would have to be 1 billion. “If you want to support Ukraine, just give them 1 billion euros,” the EU official told the newspaper. https://lnkd.in/eQijb4KP