In focus: Europe’s political balancing act within offshore energy realm

In the offshore energy realm, the week started with a protest by environmental activists against Russian fossil fuels and oil and gas in general, highlighting the urgent need to move away from these sources of energy and transition to renewable ones.

Ever since the war in Ukraine started, the world has found itself in a challenging situation where it is being pushed to focus, now more than ever, on the reliability and security of energy supply while also addressing climate change and moving on with efforts to decarbonise in line with the Paris Agreement.

Months later, European governments’ efforts to balance the security of the energy supply and climate change materialised in the form of a plan, which is expected to reduce Europe’s dependence on Russian fossil fuels and fast forward the green transition.

Environmental groups are also pushing the governments to end their reliance on fossil fuels and this week kicked off with news about yet another protest by Greenpeace activists who boarded an oil tanker carrying Russian oil, this time in the UK. The protestors called on the UK government to stop funding Putin and Russia’s war in Ukraine and end the world’s fossil fuel dependence.

Activists also pointed out that, despite the UK’s ban on Russian vessels from its ports, Russian fossil fuels are still arriving via ships registered in other countries.

Several days later, on 18 May 2022, the result of the European Union’s efforts to come up with a plan to tackle the double whammy of dependence on Russian fossil fuels and climate change was presented in the form of the REPowerEU.

According to the European Commission, measures in this plan can respond to the ambition of phasing out Europe’s dependency on Russian fossil fuels faster through energy savings, diversification of energy supplies, and accelerated roll-out of renewable energy to replace fossil fuels in homes, industry, and power generation.

The EU plans to focus heavily on hydrogen, faster deployment of renewable projects, rooftop solar and heat pump obligations, and making LNG its ‘transition fuel’.

However, the plan was criticised by environmental organisations, claiming it will “continue to bankroll conflict, human rights abuses, and environmental destruction while leaving people in Europe with high energy bills.”

Greenpeace noted the plan focuses on diversifying Europe’s imports of oil, gas and uranium from suppliers other than Russia, rather than ending Europe’s dependence on these fuels.

On the same day as the REPowerEU presentation’s arrival, Belgium, Denmark, Germany, and the Netherlands signed what is known as the Esbjerg Declaration. The four EU countries that vowed to bring at least 65 GW of offshore wind by 2030 and 150 GW by 2050 said they had set combined green hydrogen targets of about 20 GW production capacity by 2030, and are looking to expand this even further for 2050.

In the declaration, the countries pledged to increasingly replace fossil fuels, including Russian oil, coal and gas, with European renewable energy from the North Sea, including offshore wind and green hydrogen, contributing to both EU climate neutrality and energy security. For the four countries bringing forward the massive offshore wind plan, integration and interconnection are also top priorities.

Under the declaration, the four countries will jointly develop The North Sea as a Green Power Plant of Europe, an offshore renewable energy system that will consist of multiple connected offshore energy projects and hubs, offshore wind production at a massive scale as well as electricity and green hydrogen interconnectors.

Seeing wave energy as a natural partner to offshore wind and solar energy, since the production peaks at different times, representatives of ocean energy associations called both the Danish and Dutch governments and parliaments to also integrate wave energy in the energy strategy for the North Sea region by setting both national and regional deployment targets.

Welcoming the Esbjerg Declaration, the members of ocean energy industry associations in Europe spotlighted wave energy as one of the renewable sources that could complement offshore wind power plants.

Danish Wave Partnership, Dutch Energy from Water Association, Dutch Marine Energy Centre (DMEC), and Ocean Energy Europe (OEE) believe that the setting of targets for wave energy in Denmark and the Netherlands would accelerate and streamline the integration of the industry into the offshore renewables mix.

They also see the declaration as a decisive and historic step, paving the way for green energy production amongst the democracies sharing the marine space of the North Sea.

The REPowerEU plan, endorsing a massive and accelerated roll-out of renewables, was also welcomed by Ocean Energy Europe. The plan confirms that the Innovation Fund’s large-scale call this autumn will have a doubled budget of around €3 billion, with three separate funding windows.

Renewable activities are particularly suited to the second window – with a focus on ‘innovative clean tech manufacturing’ and ‘mid-sized pilot projects for validating, testing and optimizing highly innovative solutions’.

Previously, Several European renewable energy associations, including OEE, voiced their concerns about Innovation Fund not advancing the European renewable energy technology.

The OEE now plans to engage with the Commission and other renewable associations to ensure that the next Innovation Fund call supports a strong portfolio of innovative renewable proposals – including wave and tidal projects.

The shipping sector is also moving forward with crucial steps to achieve the targets of the European Green Deal, a set of policy initiatives by the European Commission with the overarching aim of making Europe climate neutral in 2050.

The EC’s proposal to include shipping in the EU Emissions Trading System (ETS) was adopted by the European Parliament’s Environment Committee, surpassing the (in)activity of the UN maritime body, the International Maritime Organization (IMO), to introduce a similar system.

Shipping emissions are said to represent around 13 per cent of the overall EU GHG emissions from the transport sector and the EU has been exploring different ways of cutting the sector’s CO2 footprint.

European shipowners welcomed the strong cross-party support by the European Parliament for key provisions under the revised ETS for shipping.

Specifically, the European Community Shipowners’ Associations (ECSA) welcomed the Parliament’s commitment to enforce the ‘polluter-pays’ principle, by ensuring the mandatory pass-through of the ETS costs to the commercial operators of the vessels through contractual clauses.