By David Sweet
In the sport of ice hockey one of the most exciting moments of the game is after one team commits a penalty and the other team has an advantage of one or more players on the ice. This typically results in a flurry of attempted shots, daring defensive plays, and quite often a goal for the team with the advantage. Power plays can also be exciting in the worlds of politics and global energy, as we have seen from history and from the recent events unfolding in Ukraine.
Most of those who work day to day in the global energy industry are professionals in their respective fields looking to do a job as best they can, and are eager to collaborate with their peers from around the world regardless of political squabbles that may take place. Gazprom in many respects has been a professional and reliable supplier to the west. However, sometimes the business of energy becomes entangled in global events because of the strategic importance of access to reasonably priced energy supplies.
The situation in Ukraine is a powerful reminder that professional co-operation is trumped by political agendas. The Arab oil embargo of 1973-74 created shockwaves throughout the world when supplies were cut off to the US and other select countries, causing oil prices to quadruple. But then during the Reagan administration the Saudis worked with the US to increase production and lower global oil prices which, in turn, devalued the ruble and hastened the demise of the Soviet Union, ending the Cold War without firing of a single shot. So if the Soviet Union was done in by oil, modern Russia is gaining stature from natural gas.
The dependence of Europe on Russian gas supplies complicates the strategic options available and another cold winter could make things significantly worse. While the US may have surpassed Russia in natural gas production as a result of fracking, and increased natural gas supplies will eventually find their way onto the world market, which could help the EU, there is little that can be done in the short term to supply Europe with natural gas exported from the US as the export facilities are not yet operational.
What can be done now to alleviate the dependence on Russian gas is to more closely look at the options for decentralized energy, local power production, to offset the global power play. The full suite of local power options should be examined for Ukraine and the European Union.
The WADE website (www.localpower.org) serves as a reminder that producing energy locally, close to the point of use, creates strength and independence through efficiency. In the game of hockey, just because one side has an advantage during a power play does not mean that the other team is assured of scoring a goal. Decentralized energy is the power play-killing strategy that needs to be unleashed in full force now until the sides are even once again.
Executive Director, WADE
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