Good morning and welcome to Europe Express.
The European Commission next week is set to put forward its revised plans on how to decrease the bloc’s energy dependence on Russia and boost green investments. We will run through the draft proposals and why they are likely to meet some opposition from green groups and local communities.
The call between central European nations that should have taken place on the planned oil embargo was postponed in part because of a sudden chill in Hungary-Croatia relations. We’ll bring you up to speed with why that was the case.
And in transatlantic news, Mario Draghi received a warm reception at the White House and we will explore why Joe Biden has made an example of him for the co-ordinated western response to Russia’s war in Ukraine — but also what headwinds he is still facing back in Rome.
Green plans
The EU’s plan to decarbonise its energy system and become independent of Russia is slowly taking shape. Europe Express has obtained several proposals being drafted for publication on May 18, writes Andy Bounds in Brussels and Valentina Pop in Berlin.
They include details on voluntary joint gas purchasing and RePowerEU, which calls for €195bn in spending over five years and sets higher targets for renewable energy deployment and consumption cuts.
To reach those, as revealed by the Financial Times yesterday, the commission wants to cut delays by fast tracking approval of wind and solar projects.
On the joint purchasing of liquefied natural gas, the commission speaks of “demand pooling . . . to maximise leverage to attract new supplies from global markets at stable prices”, a system that would not tinker with market rules.
But officials in more sceptical capitals are raising the question about what the goals of this mechanism are: buying gas at a lower price, depriving Moscow of revenues or transitioning to a greener economy — and by which legal basis it should be underpinned.
The commission does insist that the LNG contracts should be made hydrogen-compatible, meaning that when the more environmentally friendly energy source becomes available, the infrastructure used for gas could ship hydrogen instead.
But there are myriad legal and feasibility questions. The green transition plans are likely to hit opposition not just from green groups but also from many residents who oppose having wind turbines or solar panels close to their homes or landscapes.
Revisions to the Renewable Energy Directive would oblige countries to designate “go-to areas” with lighter regulation. After an overall strategic environmental impact assessment, individual projects would not need one. Renewable energy projects would be classed as “in the overriding public interest” and therefore even bird deaths would not prevent them being built, provided there were mitigating measures.
Authorities would have to approve them under a tight deadline. Last week seven NGOs, including the WWF, signed a statement warning against bypassing local communities, in order to achieve a higher level of public acceptance “which can in turn lead to the faster permitting and deployment of renewable energy throughout Europe”.
Chart du jour: Turning off taps
Read more here about the flow of Russian gas in a key pipeline to Europe through Ukraine being disrupted, with the Ukrainian grid operator blaming the Russian occupying forces for alleged illegal siphoning.
Hungary-Croatia strife
France and countries from central and eastern Europe this week were supposed to hold a video conference call on the Russian oil embargo, to iron out alternative supplies and infrastructure plans. But the call was postponed in part because of animosity between the leaders of Hungary and Croatia, write Valentina Pop in Berlin and Marton Dunai in Budapest.
Distrust between Zagreb and Budapest was aggravated by a recent statement made by Hungarian prime minister Viktor Orbán, who last week made a somewhat revisionist comment to a local radio programme. While criticising the EU oil embargo proposal as “deeply flawed”, Orbán noted that “those with coasts and seaports can import oil by ship from anywhere in the world, but there are countries that don’t have sea coasts. We’d have one if it hadn’t been taken from us, but we don’t have it now.”
This was perceived as a reference to the Austro-Hungarian empire which extended to the Adriatic Sea in current Croatia. It went down like a lead balloon in Zagreb, which summoned the Hungarian ambassador on Tuesday. “We condemn any territorial aspiration against other sovereign countries,” Croatia’s foreign ministry said.
The Hungarian government for its part said that Zagreb “misunderstood” Orbán’s comments. “The prime minister mentioned a historic fact,” Hungarian foreign ministry state secretary Tamás Menczer said. “We hope that our Croatian friends will not give in to press hysteria.”
In Brussels and Berlin, officials are still confident that a solution can be found for both capitals to bury the hatchet and approve the oil embargo — but there is no firm timeline now for when a call or a deal as such can be expected. German officials however point out that Berlin needed a few weeks to find alternative oil supplies for just two refineries, while countries like Hungary and Slovakia are fully dependent on Russian oil.
Still, while there is understanding, some officials do expect the countries to show willingness and come up with concrete plans to wean themselves off Russian fossil fuels, not just seek exemptions to be able to continue business as usual.
An Italian in Washington
Prime Minister Mario Draghi has turned hard against Italy’s old friend, Russia, after the invasion of Ukraine and the horrendous human suffering it has wrought, writes Amy Kazmin in Rome.
Draghi’s firm stand against the Russian invasion, his support for tough sanctions against Moscow, and his willingness to send heavy weapons to Ukraine have drawn positive notice from US president Joe Biden.
With Draghi on an official visit to Washington this week, Biden had warm words for the former European Central Bank chief and his dramatic reorientation of Italy’s traditional foreign policy, which saw past governments in Rome defending other Russian aggressions and impeding a unified western response. They also discussed ways to revamp energy markets with Draghi floating the creation of a “cartel” of oil consumers.
Biden acknowledged that the new resolve against Russia would not be without economic costs to Italy itself. “You’ve been one of the closest allies we’ve had in responding to the brutality of Putin,” Biden told Draghi in comments ahead of a bilateral meeting. “Your co-operation — sometimes at a greater cost than to others — to take on Putin and what’s going on in Ukraine has been really incredible.”
Draghi said that the US and Italy, bound by millions of Americans of Italian origin, were drawing closer as result of the Ukraine conflict. “The ties between our two countries have always been very strong. If anything this war in Ukraine has made them stronger. If Putin ever thought he could divide us, he has failed.”
Yet Draghi still faces limits to how far he can go in support for Ukraine.
While most Italians are deeply sympathetic to the Ukrainian suffering and clearly blame Putin for the conflict, there is little support for sending heavy arms to Ukraine among an Italian public with traditionally strong pacifist impulses and a deep horror of war.
Traditionally pro-Putin Italian politicians, such as the rightwing League leader Matteo Salvini, and former prime minister Giuseppe Conte of the Five Star Movement, are now recasting themselves as peace activists, appalled at the prospect of further escalation of the fighting and demanding peace talks.
“Other arms to Ukraine? They would bring more deaths, more war, more hunger. Return to dialogue, work for peace,” Salvini tweeted days before Draghi’s departure for Washington.
In his meeting with Biden, Draghi noted the growing public’s yearning for a return to peace — and what that might mean for Italian policy.
“We have to use any direct or indirect channel of communications but is that enough? What can we do? People think, at least they want to think, about the possibility of a ceasefire — and starting again some credible negotiations,” he said.
What to watch today
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EU-Japan summit takes place in Tokyo
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Finland’s foreign minister Pekka Haavisto speaks in the European parliament
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Two-day UK-EU parliamentary partnership assembly starts in Brussels
Notable, Quotable
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ECB rate rise: Christine Lagarde yesterday signalled that she would support raising the European Central Bank’s main interest rate in July, the first increase for more than a decade.
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British support: The UK has promised to help Sweden and Finland should they come under attack from Russia, as it seeks to provide security assurances from the moment they apply to join Nato to when they become members.
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Kherson: Local officials installed by Moscow in the southern Ukrainian city of Kherson said they intended to ask President Vladimir Putin for the region to join Russia, in the clearest sign yet that the Kremlin plans to annex the province.
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Turkish cap: Turkish authorities have raised the pressure on the country’s banks to limit corporate clients’ purchases of foreign currency in an effort to halt a renewed slide of the lira.