European leaders, seeking to punish Russia for its role in suspected atrocities in Ukraine, are targeting a ban on coal as the most easily replaced imported energy source.
Deliberations on the ban and other sanctions on Wednesday were set to continue until Thursday, with European Union officials and diplomats expecting the measures to be approved by then. The process reflected the challenges of reaching an agreement among all 27 member states on the sanctions, including banning Russian ships from EU ports.
If approved, the sanctions would be the strictest the bloc has imposed since Russia’s President Vladimir V. Putin launched the invasion of Ukraine six weeks ago. Sanctions must be approved by all Member States.
Although the European Union depends on Russian coal, the bloc could more easily replace it with imports from countries other than natural gas and oil.
But banning coal from Russia could push energy prices up for European consumers, given existing shortages in the bloc, according to consultancy Rystad Energy. Carlos Torres Diaz, a senior vice president at Rystad, called the potential sanctions “a double-edged sword.”
According to the statistics office of the European Union, Eurostat, imports from Russia accounted for 47 percent of coal entering the European Union in 2019, making the country the main supplier of the fuel. That equates to EUR 4 billion worth of coal per year, said Ursula von der Leyen, the president of the European Commission.
Each member state has different energy needs, and among those most dependent on Russian energy in general, Germany’s largest economy is the bloc. About half of all coal that Germany imports comes from Russia, in total last year 2.2 billion, according to government figures. Most of it is used to generate electricity and power the German steel industry.
Lignite, or lignite, the only fossil fuel left in Germany, is burned to generate electricity. It is also the dirtiest fossil fuel, making it urgent to stop burning coal. But 2021 turned out to be less windy than expected, hurting the country’s wind energy efforts, leading to a nearly 5 percent increase in coal-generated power for the year.
Chancellor Olaf Scholz’s government had plans last year to get the country out of coal by the start of the next decade, and last month Vice-Chancellor and Economy Minister Robert Habeck said Germany will move towards it. aim to turn off Russian coal by the end of the summer.
“How we will implement a coal embargo is well prepared,” Mr Habeck said on Wednesday.
Diplomats in Brussels said Germany and other countries that previously opposed a ban on Russian coal had been given a three-month hiatus, which would allow them to complete pending orders and terminate existing contracts before the measure is enforced.
German companies have already renegotiated contracts with other countries that export coal, Mr Habeck said. But shipments already ordered and en route from Russia would not be stopped or returned, he added. “If we send those ships back, we could run a deficit,” he told reporters in Berlin.
Coal from the United States, Colombia and South Africa could help close the gap created by cutting imports from Russia, according to the German Association of Coal Importers, an industry group representing companies that depend on coal supplies from the United States. abroad.
In a phone call on Wednesday, Mr. Scholz and Colombia’s President Iván Duque Márquez discussed the war in Ukraine and energy, the chancellor’s office said.
Australia supplied nearly a third of the European Union’s coal imports in 2019. Australian markets have already reported a rise in their coal prices as companies in Europe have turned to them to inquire about fuel.
Poland is the EU country that is still most dependent on coal. While much of the country’s coal is sourced domestically, about 20 percent was imported from Russia last year.
Last month, Polish Prime Minister Mateusz Morawiecki proposed legislation to ban coal imports from Russia.
Shutting down Russia’s oil and natural gas will prove much more difficult. According to Mr Habeck, Germany has already reduced its dependence on gas from Russia by 15 percent in the first three months of the year. But industry leaders have warned against imposing sanctions on Russian natural gas as it could lead to significant job losses in the chemical, mining and pharmaceutical sectors.
Mr Habeck presented draft legislation to accelerate the expansion of renewable energy in Germany, aimed at generating more from wind and solar energy.
But it will be several years before new terminals are built that would allow liquefied natural gas to arrive by ship, as a replacement for Russian gas that comes through a pipeline. And even if approval processes are streamlined, it could still be years before the terminals can replace nearly 22 percent of Germany’s energy mix that comes from natural gas.
Matina Stevis-Gridneff reporting contributed.
