It has taken the rumble of Russian tanks to remind us of the importance of energy security. While American consumers are understandably focused on the price at the gas pump, the main stage for this global energy crisis remains Europe’s reliance on Russian energy and what the U.S. can do to help defang Russia’s energy weapon.
Russia doesn’t have to turn off the supply of energy to Europe to cause excruciating pain. The threat of doing so in an already tight market is sending European energy prices to eye-watering heights. Power prices in Europe have jumped 1,000% above pre-crisis levels. The cost of wholesale natural gas is 20 times what it was a year ago.
After spending the last decade deepening its reliance on Russian energy, Europe is now trying to de-Russify its supply nearly overnight. The European Union hopes to cut its imports of Russian gas by two-thirds by next winter, cut its reliance on Russian coal and quickly phase down its reliance on Russian oil. As necessary as this about-face will be, it’s going to hurt.
European energy insecurity is the accumulation of policy choices — frankly, policy missteps the U.S. would do well to not repeat.
There’s an overarching energy lesson to be learned: beware of eliminating fossil fuel supply and generating options before you can reliably, securely and affordably replace them. Europe’s waning investment in its own natural gas supply and, notably, its rush to close its coal capacity before building a reliable alternative have left it stunningly dependent on Russian energy. In fact, Europe is now more reliant on Russian natural gas today than it was before the Russians annexed Crimea in 2014.
Of course, Europe is painfully dependent on Russian coal as well, with Russian coal meeting half of demand. Replacing Russian gas and coal is an extraordinary challenge, but it’s just what the U.S. and its global partners should strive to do.
For the U.S., aiding our allies and ensuring we can affordably and reliably navigate the energy transition should mean embracing a new chapter of the energy abundance agenda. In short, produce, manufacture, build and export as much as we can to shore up U.S. energy security, declaw the Russian energy weapon and ensure that coming to the aid of our allies and confronting geopolitical rivals doesn’t come with crushing costs to U.S. consumers.
Unfortunately, the current path we’re on seems frustratingly similar to the missteps taken by Europe. We’re disassembling well-operating, essential U.S. energy generating capacity and infrastructure far faster than we’re building reliable, affordable alternatives. U.S. dispatchable fuel diversity is now a shell of itself in many regions of the country and regulators, grid operators and utilities are warning of an accelerating grid reliability crisis.
As President Joe Biden looks to reinvigorate U.S. energy security and take on inflation, we must be willing to quickly learn from Europe’s stumbles and embrace energy pragmatism. That means recognizing that we can both pursue the deployment of renewable energy and advance the electric vehicle revolution while also ensuring we have the reliable, secure and affordable energy provided by traditional fuels and existing energy infrastructure.
Conor Bernstein is a spokesperson for the National Mining Association, the industry’s trade group based in Washington, D.C.