The head of the International Energy Agency (IEA), Fatih Birol, has highlighted that Poland is set to assume the presidency of the EU at a pivotal time for the bloc’s economy. He identified three significant errors made by the EU: becoming dependent on Russia for energy, moving away from nuclear power, and allowing China to take the lead in green technologies.
Birol spoke at a meeting in Brussels on Monday, focusing on Poland’s upcoming presidency of the EU Council, which will commence in the first half of 2025.
He referenced an impending strategy on clean industry that the European Commission is preparing to unveil within the first 100 days of its new term, coinciding with Poland’s presidency.
According to Birol, a new industrial plan is essential for the EU to rectify its historical missteps. The first mistake was a reliance on a single country for energy, leading to a lack of diversification in supply sources. He noted that as early as 2004, the IEA’s chief economist warned in the “Financial Times” that Germany should not depend on Russia, a caution that went unheeded.
The second error, he stated, was Europe’s retreat from nuclear energy, which previously accounted for 30% of the continent’s electricity. He pointed out that while some countries entirely abandoned nuclear power, others ceased investing in it, resulting in projections that nuclear will only provide 15% of the EU’s electricity in the near future.
The third mistake involved losing competitiveness in the renewable energy sector, particularly in solar panel production. Birol noted that Europe once produced 60% of these installations, whereas now China dominates with 80% of production.
He also identified three critical challenges facing Europe due to these past decisions. Firstly, the EU must tackle its energy costs, which are currently five times higher than those in the U.S., posing a barrier to industrial competitiveness.
However, Birol assured that natural gas prices are expected to decline in the future, thanks to an influx of LNG from the U.S. to Europe. He cited current oil prices at $70 a barrel, emphasizing that previously, such conflicts would have driven prices into the triple digits. He believes buyers will soon influence fuel prices more significantly.
Secondly, Europe needs to harness its potential in emerging technologies, such as heat pumps, offshore wind farms, and electrolysis, to remain a key player in these fields.
Lastly, Birol urged the EU to address its lengthy and complex decision-making processes, which hinder swift responses to new challenges.
“The Polish presidency will occur at a crucial juncture; I hope it is approached with the seriousness it warrants,” he remarked to the Polish authorities. (09.12.2024)
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