Europe is tackling an unprecedented energy crisis. And there are few options. However, Africa has probably emerged as the most viable alternative energy source. But how did Europe get here? It began with the devastating economic sanctions imposed on Russia over Moscow’s military adventures in Ukraine. This soon began to look like a bad miscalculation, as it relied heavily on Russian oil and gas. In retaliation, Russia has slowly shut down the faucet, in addition to imposing its own conditions for resuming supply. Europe continues to look at potential economic ruin. While walking a tightrope, I chose to explore alternative energy supply options. Therefore, Africa, which has some of the world’s largest oil suppliers, could come to the rescue. Now that the western capital is moving to rush to kill to protect itself from economic ruin, how much does it cost for Africa?
“It’s a down chain of energy dominoes,” says Javier Brass, an energy policy expert at Bloomberg. He says that once the dust has settled, the total bill to save the European energy market this winter will easily exceed $ 200 billion. This number is certainly an estimate by the International Energy Agency.
In February, London announced billions of pounds of bailouts to mitigate the impact of a 54% increase in the country’s retail energy cap. Currently, an increase of nearly 70% is expected to be announced in early August. These are figures from OFGEM, the government’s energy regulatory agency.
Germany is in a similar situation. Russian President Vladimir Putin has cut gas supplies to Germany by about 60 percent. Uniper, a Frankfurt-based energy company, loses about 30 million euros daily because it has to buy the same gas on the spot market, Brass added to the report.
One of the largest investment banking companies, Goldman Sachs Report■ European households will have to pay € 470 per month for electricity and gas, an increase of 290 percent from normal costs in mid-2020.
After the start of the Ukrainian War, European gas prices soared to record highs due to strong winter demand and boiling geopolitical tensions between major suppliers Russia and consumers.
Gas prices in Europe surged nearly 20% to reach 175 euros per megawatt hour. The European economy will begin to shrink in the second half of 2022, and the recession will continue until the summer of 2023, with a 1.7% decline in GDP expected.
European countries that rely on Russia’s gas are competing to find alternative supplies. European Commission President Ursula von der Reyen signed a supply contract with Azerbaijan last Monday.according to Financial Times, The deal aims to increase deliveries to Europe by 48% this year and double by 2025. However, Azerbaijan imports are only a small part of the EU as a whole. Of course, the Caucasus country is one of several countries, including Africa being brought to court by the EU in an attempt to secure an alternative to Russia’s supply.
Meanwhile, European and North African countries can significantly reduce their CO2 equivalent emissions without delaying energy transformation and can benefit significantly from new sources of income to reinvest in clean energy sources.
During last year’s COP26, the governments of South Africa, France, Germany, the United Kingdom and the United States, along with the European Union, announced a new ambitious and long-term Just Energy Transition Partnership to support South Africa’s decarbonization efforts. ..
For the gas pipelines of Nigeria and Morocco, Africa’s largest gas energy projects today, the Nigerian president will fund the gas pipeline with $ 25 billion by emphasizing the potential to resolve the European energy crisis. I am calling on Europe.
This pipeline is crescent-shaped, including 11 African countries. It is called the golden crescent. From Nigeria through Ghana, Guinea, Senegal and Mauritania, it ends in Morocco, Africa’s European border. Funding for this project will be a powerful savior for European energy security.
Italy is also in the process of boosting supply from Algeria, along with Italian energy company Eni and France’s Total Energies. Last week, a $ 4 billion new gas development project was signed with Sonatrach, Algeria. This will eventually start a new supply.
In Africa, regional experts point out the dangers of Africa by large European oil and gas exploration companies. Looking back on past experiences, it clearly shows what Africa must do to protect its communities and the environment.
In this regard, Africa needs to enhance its game. All oil and gas producing countries, as well as countries with undeveloped reserves, need to pave the way for investment. By attracting green investment, Africa will surely reach its socio-economic development goals. In addition, Africa can partner with countries with significant demand.
In summary, it is strategically wise to partner with a country that has oil and gas demand, rather than partnering with a country that is already an oil and gas producer. Its vast energy resources put African oil and gas producers in a good position to act as an intermediary in this global conflict, instead of choosing to act as agents.
The views expressed in this article are those of the author and do not necessarily reflect the editorial policy of Middle East Monitor.
https://www.middleeastmonitor.com/20220722-when-the-dust-settles-how-africa-will-help-the-eu-energy-crisis/ How Africa Helps EU Energy Crisis Once Dust Settles – Middle East Monitor