EU launches trillion euro energy revamp, effort to cut dependency on Middle East Oil and Russian Gas

During its recent summit, the EU outlined plans aimed at curbing the region’s dependency on Middle East oil and Russian gas. In a report carried by the AFP, European leaders Friday last week launched a trillion-euro effort, primarily targeted at reducing the EU’s overreliance on Oil from the Middle East and Russian gas imports.

The investment paves the way to place nuclear power at the centre of the EU’s 21st century needs, reported AFP. The summit was largely overshadowed by the ongoing popular revolt in Egypt and the resultant soaring oil prices. Subsequently, the EU signified its intention to reclaim control over energy supply for the rest of the century with reforms designed to unlock private investment.

The EU is currently the world's largest regional energy market with 500 million people and 20 million companies. EU member governments have committed to a broad sweep of market reforms, linking national and regional electricity grids and gas pipelines by 2014 to allow power to circulate freely and cheaply from producers and have surpluses to those who don't produce it but need it, reported AFP.

In a summit conclusion statement read by EU president Herman Van Rompuy, no EU member state should remain isolated from the European gas and electricity networks after 2015 or see its energy security jeopardized by lack of the appropriate connections, reported AFP. Van Rompuy further said that beyond the management of today's crisis, the EU is also laying the ground for a sustainable and job-creating growth.

The move follows fears from Island states such as Cyprus and Malta, as well as Baltic countries whose infrastructure remains tied to the former Soviet Union. Such Island states are worried their needs may be considered too insignificant for the big energy players to invest in costly transmission networks.

However, the EU agreed that pooled public money could underpin completion of this so-called 'supergrid' -- although ballpark sums will not be produced until the summer, said the report. Initial European Commission estimates suggested that some 2.5 billion Euros could be diverted from unspent EU budgets.

According to the AFP report however, an EU diplomat expressed doubt that Britain may not front such an approach. Prime Minister David Cameron is reportedly comfortable with allowing "some limited public finance to leverage private funding," as the summit conclusions specified, provided it comes from cuts elsewhere in the EU budget. The network development cost over the remainder of the decade is tipped to exceed 200 billion Euros.

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