The EU is on target to end its reliance on Russian fossil fuels this decade, but warned there is "no room for complacency" regarding the vulnerability of its energy markets, according to a union report published Oct. 24.
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Register NowThe EU's annual State of the Energy Union Report 2023 said efforts to pivot away from Russian energy was succeeding, with the bloc on track to meet the REPowerEU target to be independent of Russian fossil fuels by 2027.
"The worst effects of the crisis may now be behind us, but there is no room for complacency," the report said.
"Energy markets remain vulnerable," it said. "Our critical infrastructure needs to be protected, including from sabotages, and the impact of the crisis shows the risks of dependence on unreliable sources."
In 2022, total Russian imports of gas fell to around 80 Bcm, compared with an annual import level of around 155 Bcm before the crisis. EU imports of Russian gas sit at around 40-45 Bcm so far in 2023.
And despite increased Russian imports of LNG over the same period – largely under take-or-pay long-term contracts – Russia's overall share of total EU gas imports has fallen to 15%, from around 45%-50% pre-crisis, the EU said.
Demand reduction efforts have also contributed, according to the report, with the EU saving more than 18% (53 Bcm) more gas compared to the previous five years.
EU policy reforms and support measure were also said to have limited price risks in European gas markets, but the report stated that the number of persons affected by energy poverty had increased by 10.7 million across the EU.
"The EU needs to stay vigilant and continue to reduce energy dependencies as the risk of energy supply disruptions and consequent price peaks is still present," the report said.
European gas prices have edged higher this month, largely on the back of supply-side concerns. Platts, part of S&P Global Commodity Insights, assessed the Dutch TTF month-ahead price at Eur49.03/MWh on Oct. 24.
Winter preparedness
The EU said it was well prepared to ensure energy security through the upcoming winter 2023-24, largely through varied energy sources, filled gas storage facilities, and reduced demand.
However, it pointed out several key risks that could emerge over the period, namely the complete cessation of pipeline imports and attacks on critical infrastructure, highlighting the temporary closure of Israel's offshore Tamar gas field and the Balticconnector outage earlier this month as key examples.
"Prices remain volatile and react to any disruption on the global market," the report added.
In its concluding remarks, the report said that coordination between EU member states, alongside preparedness and resilience, will remain crucial components for ensuring energy security, enhancing the bloc's energy independence and completing the clean energy transition.