Johanna Fabian-Marks Energy Security Position Paper Estonia I ...

Johanna Fabian-Marks
Energy Security Position Paper
Estonia
I. Introduction
Energy security is of vital importance to the European Union. The EU already
imports a majority of its oil and gas, and the percent imported is only expected to increase in
the coming years. The recent dispute between Ukraine and Russia, which resulted in some
EU residents losing their gas for weeks, illustrates the extent to which the EU relies on
foreign, potentially unstable, energy sources. As the EU becomes an ever-closer union, it
must work towards presenting a united face when negotiating with its external energy
suppliers. The negotiating power of the EU is much greater than that of any individual state;
all member states benefit from the increased security of a united energy policy.
II. Energy in Estonia
Estonia is fortunate among EU member states in that it relies much less than average
on energy imports. Estonia imports only about one-third of its energy. The majority of
Estonia’s energy (56%) comes from oil shale deposits, but Estonia is making progress with
renewables, which now account for 10% of the energy supply. Estonia does import oil (48%
of imports) and natural gas (41% of imports). Russia is the sole supplier of natural gas to
Estonia.
Although Estonia is less dependent on energy imports than many of its fellow
member states, it was nonetheless very concerned by the Russia–Ukraine gas crisis earlier
this year. Estonian oil shale deposits are being slowly exhausted, so Estonia may become
more dependent on external energy imports in the future. The Estonian electricity system is
primarily connected with other former Soviet states and has yet to be full liked up with the
EU system. This isolation makes the Estonian energy network less secure and leads Estonia
to look forward to increased integration within the EU energy market through additional
power transmission connections between Estonia and Finland, Sweden, and Poland.
Estonia supports the diversification of the EU energy supply. As a state entirely
dependent on Russia for its natural gas, Estonia understands the insecurity of dealing with a
monopoly provider. Unfortunately, neither the Nabucco nor the BTC pipelines are currently
planned to connect to Estonia. Russia likely will remain the primary supplier of natural gas to
Estonia.

III. Proposals/Objectives
Estonia completely agrees with the Czech Republic that the EU must have a clear and
strong external energy policy. All EU countries will benefit from having a united voice at the
bargaining table, but smaller countries like Estonia particularly appreciate the importance of
cooperating to maximize influence. As the Estonian Foreign Policy Institute concluded,
“Bilateral relations open opportunities for Russia to manoeuvre in relations with the EU by
taking advantage of discords between individual Member States and the European
Commission.” 1 The Estonian President, Toomas Hendrik Ilves, put it even more bluntly,
“Russia has used energy as a foreign policy instrument against Estonia for 15 years and will
continue to do so . . . There must be an awareness that energy can be used for manipulation.” 2
Bilateral deals with Russia may seem to be in a member state’s best interest, but in the long
run all member states will benefit more from a united approach to Russia and other external
energy suppliers. Estonia proposes that the EU move towards eliminating bilateral deals with
external energy suppliers.
Estonia also joins the Czech Republic in its support for energy diversification. It is
unwise for the EU to depend on any one region, be that Russia or elsewhere. The Nabucco
and BTC pipelines expand the options available to the EU and therefore increase its security.
Competition should improve the energy market for EU consumers. The Nabucco pipeline
merits EU funding. Nabucco is also a good example of the difficulties bilateral energy deals
may engender. Originally supported by a number of EU states, Nabucco has languished as
Russia made a concerted effort to “divide and concur” by wooing away its supporters.
The EU must press Russia to ratify the Energy Charter Treaty and to accept its
requirement that Russia allow third-parties to transport gas and other forms of energy through
its network. The Energy Charter builds an international legal foundation for energy security
and aims “to strengthen the rule of law on energy issues by creating a level playing field of
rules to be observed by all participating governments”. 3 Ratification of the Energy Charter
Treaty will make Russia subject to the dispute resolution mechanism of the Treaty, which
will be useful if future energy disputes involving Russia.
1
Estonian Foreign Policy Institute. Energy Security of Estonia in the Context of the Energy Policy of the
European Union. September 2006.
2
EU Business.com. “Russia uses energy to squeeze EU: Estonia president.” 29 December 2006.
3
“About the Charter.” Energy Charter Treaty. Accessed 17 February 2009 at www.encharter.org