• 2006-12-13

cartoon by Jevgenijs Cheksters

Never before has the Baltic region seen such a flurry on infrastructure activity. In one week a power cable was fired up, a deal on electrical grid connection signed, and a four-country consensus on building a new nuclear power plant reached. The total value of the three projects approaches 4.5 billion euros, or nearly half of Estonia's GDP. Try beating that. No doubt the euroskeptics are retreating in horror.

Granted, there is still much work to be done 's an uphill battle to fight with all the requisite EU paperwork 's but Estlink, the Baltic-Finnish cable stretching along the bottom of the Gulf of Finland, is an inspiring example. Large energy projects can be pulled off.
Besides, with Poland on board, and Russia wielding its hydrocarbons like a battle-ax, it will be easier to get Brussels to go along with the two agreements made in Vilnius on Dec. 8. For in the energy chain crisscrossing the European continent, the Baltics are the weak link. After the atomic energy plant in Ignalina closes in 2009, this weakness will only become more accute. An understanding of the need to rely on other EU member states deepens with each month 's the "energy security" theme is more prevalent than ever 's among both old and new members.

The situation is grave. A recent Eurostat bulletin states that the EU's energy dependence rate was 56 percent last year, up from 54 percent in 2004 and 44 percent in 1995. The bloc's own energy production fell by 2 percent over the decade, while imports soared 29 percent. The trend, in fact, is fretful. Annual energy production in the European Union was down in 2005 on nearly all types 's crude oil by 9 percent, gas by 5.8 percent, coal by 5.7 percent and nuclear power by 1.3 percent.

Though aggregate consumption in the EU has been flat, energy prices aren't. From July 2005 to July 2006 the average household saw a 7 percent increase in electricity prices, while industry saw a 15 percent jump, according to the latest data from Eurostat. Although there are calls to curtail consumption, no major breakthrough is likely to occur given human nature. Thus on a backdrop of falling production, European vulnerability is increasingly apparent.

In this sense, the Baltic region is a microcosm of Europe's gradual energy atrophy. But as we are on Russia's doorstep, there is an added chill in the air. Poland buys the region's only oil refinery 's in Mazeikiai, Lithuania 's and the covetous Kremlin reacts by ceasing deliveries of crude. In this kind of environment, the stakes are unusually high, but it is the successes of last week that give cause for hope. The Baltics needn't be the odd man out in the EU's energy market, and working together they can ensure a secure energy future.