After the Ukraine Invasion: Energy Realism Emerges In Germany While the US Doubles Down

After the Ukraine Invasion: Energy Realism Emerges In Germany While yhe US Doubles Down


By Tilak Doshi

 

I analyze energy economics and related public policy issues.

 

In a landmark address on February 27th to the Bundestag, the German parliament, Chancellor Olaf Scholz announced a stunning shift in the country’s defense posture and its energy policies in response to Russia’s invasion of Ukraine.

 

Commentators might be forgiven if they were reminded of Samuel Johnson’s adage that nothing better concentrates the human mind than the hangman’s noose.

 

Russia’s invasion constituted the largest military attack of one state against another in Europe since the Second World War, marking in Scholz’s view a turning point in the continent’s history.

Germany’s Radical Policy Turnaround

 

In a sharp reversal of Angela Merkel’s policy of free riding on US support for NATO, Germany’s new Chancellor vowed to increase military expenditure to above 2% of GDP.

 

This will make Germany — hitherto the laggard in defense readiness with armed forces that were “more or less stripped bare” during Merkel’s 16-year reign as noted by its Chief of Army —  the largest spender on the military in Europe, with significantly higher defense expenditures than in the United Kingdom and France. “Deutschland Uber Alle”

 

An Irish political commentator tweeted “Germany [is] basically doing what Donald Trump demanded that they do — to widespread ridicule — for the four years of his Presidency. I know it galls people to hear it, but Trump was right about some very big things.”

 

In another radical departure from the timorousness of the Merkel years, Scholz agreed to deliver arms including anti-tank weapons and Stinger missiles to Ukraine directly and through third countries. 

 

The Chancellor also signaled another major turn in its policy towards economic and financial sanctions on Russia, coordinating with the G7 bloc to exclude key Russian banks from the SWIFT international payment system and constraining the Russian central bank from supporting the ruble with its ample foreign exchange reserves.

 

Scholz’s announcement of a turnaround in German energy policies have been equally striking. Germany is overly dependent on Russia for its energy supplies, accounting for 60% of its gas imports, as well as 50% of its coal and 35% of its oil.

 

The previous Merkel government, which focused on ever closer economic relations with Moscow and a pacifist foreign policy, heavy dependence on Russian gas was not seen as a key source of energy security vulnerability.

 

Her government strongly supported the Nord Stream 2 gas pipeline which would have doubled shipments of Russian natural gas to Germany.

 

By transporting the gas under the Baltic Sea directly to Germany, Nord Stream 2 by-passes Ukraine and other East European countries which provide major routes for existing Russian gas supplies reaching Europe.

 

Back in November, former President of the European Council Donald Tusk said that the approval of the Nord Stream 2 pipeline from Russia was the outgoing German Chancellor Angela Merkel’s “biggest mistake”, in comments which supported the warnings from former President Donald Trump, who had imposed sanctions on the pipeline.

 

In July 2021, President Joe Biden, in his continued zeal to revoke every decision made by the preceding Trump administration, waived those sanctions to “mend” relations with the Merkel government.

 

On 22nd February, in response to Russian President Vladimir Putin’s recognition of the independence of two breakaway regions in eastern Ukraine, Scholz suspended the certification process of the completed Nord Stream 2 gas pipeline.

 

This was followed shortly thereafter by the Biden administration re-imposing US sanctions on the pipeline.

 

Perhaps in an even more striking reversal of long-settled German energy policy – which aims for a  rapid transition from fossil fuels and reliance on renewables for all of the country’s energy needs — Economy Minister Robert Halbeck said that “there were no taboos in deliberations” concerning options to extend the operations of the country’s coal and nuclear power stations or in importing liquified natural gas (LNG).

 

Halbeck is a member of the Green party which ensured the subordination of EU energy policy to the goal of net zero emissions for Europe by 2050.

 

In Germany’s about-turn in energy policy, the government is now considering options to extend the operations of its coal power plants beyond 2030.  The country had previously committed to a full exit from coal by that date.

 

To reduce dependency on Russian gas imports, Halbeck is also not ruling out options to extend the life-span of its three remaining nuclear power plants.  

 

The country is now accelerating plans to build two LNG terminals in order to diversify its dependence on Russian gas imports.

 

Germany has significant storage capacity — the biggest in the EU — at around 23 billion cubic meters (bcm) and now plans to expand this by 2 bcm and intends to bring in regulations to ensure minimum storage requirements on private companies.

 

Biden’s Incoherent Energy Policies

 

If a modicum of energy realism has descended upon Germany after the shock Russian invasion of Ukraine, it would seem that the Biden administration  – which joined Europe in the climate crusade immediately after it took office and which put “fighting climate change” as the country’s top national security concern – continues to pursue an incoherent energy policy that borders on ridiculousness.

 

Having cancelled the Keystone XL pipeline to transport over 800,000 barrels per day of oil from Canada to the US Gulf Coast refiners on his first day in office, President Biden revoked US sanctions on Russia’s Nord Stream 2 gas pipeline as already mentioned.

 

After issuing a series of executive orders in the first weeks of his presidency which halted oil and gas leases on federal lands and in the Alaskan Arctic refuge – essentially waging a regulatory war on US oil and gas production – the Biden presidency continues to implore OPEC to increase oil production as US gasoline prices surged to multi-year highs and approach $4.00 a gallon.

 

The OPEC group including kingpin Saudi Arabia have repeatedly rebuffed these requests from the US, most recently last week.  

 

In what may plausibly be termed as energy masochism – driven by its climate change obsession — the Biden administration continues to favor the interests of the likes of Russia and Iran at the cost of those of its presumed allies.

 

On February 18th, in an act of bizarre timing, the Federal Energy Regulatory Commission (FERC) revised its policy for approving natural gas pipelines and export terminals which will adversely impact the already fraught permitting and construction process of new US LNG export facilities.

 

FERC by law must vouch that projects are in the public interest and won’t have a significant environmental impact but which now includes greenhouse gas emissions in its environmental analysis.

 

In yet another instance of energy policy incoherence which further empowers Russia’s energy leverage over Europe, the Biden administration abruptly withdrew support for, and thereby killing, the Eastern Mediterranean natural gas pipeline project in January.

 

It did this without consulting its closest allies in the Mediterranean region, Israel, Greece and Cyprus.

 

The ‘EastMed’ pipeline, designed to bring natural gas from the offshore fields of Israel and Cyprus across Greece to Italy and Bulgaria, was supported by Mike Pompeo, the previous US Secretary of State, when he was in office.

 

Yet another source of much needed diversification of natural gas supplies for Europe has thus been vetoed by President Biden.

 

But perhaps US energy policy incoherence is best exemplified by John Kerry, President Biden’s climate envoy. Straight out from the “you can’t make this up” file, Kerry stated surreally, in an interview on BBC Arabic, last week, that he hoped Vladimir Putin would “stay on track” in the fight against climate change on the day Russia unleashed the invasion of Ukraine.

 

Geopolitical Realism and Energy Realism

 

Author and energy commentator Rupert Darwall states concisely that geopolitical realism requires energy realism. Keen observers of realpolitik and energy affairs with an understanding of basic economics, such as President Putin, are under no illusions.

 

While Europe was busy deconstructing its modern energy infrastructure in the vain hope random wind and solar are enough to power modern civilization, President Putin was doing all he could to develop Russia’s fossil fuel resources.

 

In late 2020, Professor Fritz Vahrenholt – with a career that included positions in Federal Environmental Agency in Berlin, and as minister for energy and environment in Hamburg state — stated , baldly, in a German TV interview, that climate science was “politicized”, “exaggerated”, and filled with “fantasy” and “fairy tales”.

 

He predicted Europe “will reach the [climate policy] targets, only if they destroy the European industries.”

He castigated Germany as a country “in denial when it comes to the broader global debate taking place on climate science”.

He went on to characterize Europe’s recent push for even stricter emissions reduction targets as madness akin to Soviet central planning that is doomed to fail spectacularly.

Perhaps it takes a Putin with the hangman’s noose to convince Germans that Prof. Vahrenholt is right on the mark.

 

- I have worked in the oil and gas sector as an economist in both private industry and in think tanks, in Asia, the Middle East and the US over the past 25 years.

- I focus on global energy developments from the perspective of Asian countries that remain large markets for oil, gas and coal.

- I have written extensively on the areas of economic development, environment and energy economics.

- My publications include “Singapore in a Post-Kyoto World: Energy, Environment and the Economy” published by the Institute of Southeast Asian Studies (2015).

- I won the 1984 Robert S. McNamara Research Fellow award of the World Bank and received my Ph.D. in Economics in 1992.

 

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Comment by Willem Post on March 7, 2022 at 9:57am

EXCERPT from:

THE UKRAINE PLOT IS THICKENING WITH GERMANY AND FRANCE BARELY IN LOCKSTEP WITH US/UK-LED NATO

https://www.windtaskforce.org/profiles/blogs/the-plot-is-thickening...

NATO Expansions Starting in 1999

 

The “unprovoked, unjustified” descriptor of the Ukraine War obscures a long history of provocative actions by the US regarding Ukraine. This history is important to understand: 1) how we got here, and 2) what responsibility the US bears for the current attack on Ukraine.

https://fair.org/home/calling-russias-attack-unprovoked-lets-us-off...

 

Unprovoked?

- NATO expanded its military personnel and infrastructures beyond East Germany to Russian borders, after promising not to expand beyond East Germany in 1990.

- NATO claims innocence, because each country has a right to make its own security arrangements, which is OK, except it should not be dome at the expense of the security of other countries.

- However, NATO has no right to claim innocence, because it pledged not to expand beyond East Germany in 1990

 

Unjustified?

- NATO would have AEGIS systems, with hypersonic missiles, in Poland, Ukraine and Romania that would, if equipped with nuclear bombs, would have the potential to destroy all of Moscow and East Russia within minutes.

- Russia could have a proper counter protection, but it would have to place similar missiles on Cuba and in Mexico.

 

This article also summarizes statements by prominent people in the UK, US, and Europe opposing NATO expansions.

 

In 1997, dozens of foreign policy veterans (including former Defense Secretary Robert McNamara and former CIA Director Stansfield Turner) sent a joint letter to then-President Bill Clinton calling “the current US-led effort to expand NATO…a policy error of historic proportions.” 

 

In 1998, NYT columnist Thomas Friedman (5/2/98) asked George Kennan—architect of the US Cold War strategy of containment—about NATO expansion. Kennan’s response:

 

I think it is the beginning of a new cold war. I think the Russians will gradually react quite adversely, and it will affect their policies. I think it is a tragic mistake. There was no reason for this whatsoever. No one was threatening anybody else.

 

Of course, there is going to be a bad reaction from Russia, and then [the NATO expanders] will say that we always told you that is how the Russians are—but this is just wrong.

 

Despite these warnings, Poland, Hungary and the Czech Republic were added to NATO in 1999, with Bulgaria, Estonia, Latvia, Lithuania, Romania, Slovakia and Slovenia following in 2004.

 

In 2008, US planners were warned by US Ambassador to Moscow William Burns (now director of the CIA under Joe Biden). WikiLeaks leaked a cable from Burns titled “Nyet Means Nyet: Russia’s NATO Enlargement Redlines” that included another prophetic warning worth quoting in full (emphasis added):

Ukraine and Georgia’s NATO aspirations not only touch a raw nerve in Russia, they engender serious concerns about the consequences for stability in the region.  Not only does Russia perceive encirclement, and efforts to undermine Russia’s influence in the region, but it also fears unpredictable and uncontrolled consequences which would seriously affect Russian security interests.

 

Experts tell us that Russia is particularly worried that the strong divisions in Ukraine over NATO membership, with much of the ethnic Russian community against membership, could lead to a major split, involving violence or at worst, civil war.  In that eventuality, Russia would have to decide whether to intervene; a decision Russia does not want to have to face.

 

Even without officially being in NATO, Ukraine has become a de facto NATO ally—and Russia has paid close attention to these developments.

 

In December 2021 Putin expressed his concerns:

 

Over the past few years, military contingents of NATO countries have been almost constantly present on Ukrainian territory under the pretext of exercises. The Ukrainian troop control system has already been integrated into NATO. This means that NATO headquarters can issue direct commands to the Ukrainian armed forces, even to their separate units and squads….

 

Kiev has long proclaimed a strategic course on joining NATO. Indeed, each country is entitled to pick its own security system and enter into military alliances. There would be no problem with that, if it were not for one “but.”

 

International documents expressly stipulate the principle of equal and indivisible security, which includes obligations not to strengthen one’s own security at the expense of the security of other states….

 

In other words, the choice of pathways towards ensuring security should not pose a threat to other states, whereas Ukraine joining NATO is a direct threat to Russia’s security.

 

In 2014, Ukraine experienced a color revolution, called the Maiden Coup, largely instigated by the US. The US involvement was part of a campaign aimed at exploiting divisions in Ukrainian society, to push the country into the US sphere of influence, pulling it out of the Russian sphere (FAIR.org1/28/22). In the aftermath of the illegal overthrow, Russia illegally annexed Crimea from Ukraine, in part to secure a major naval base from the new Ukrainian government.

 

Broken Pledges and Geo-Strategic Objectives: All this would have been avoided, if the US/UK/EU/NATO had kept their promises, made in 1990, not to expand beyond East Germany

 

George Kennan, former US ambassador to the Soviet Union, suggested to the US government in 1990s, expanding NATO up to Russia’s borders would be the most fateful error of American policy. Regrettably, the US government turned a deaf ear to this.

 

Thomas Friedman, a famous US expert on international relations, wrote in a recent article that ill-considered decision by the US to expand NATO has undermined the relations with Russia and the US government in early years deserves much of the blame.

 

Tulsi Gabbard, former member of the US House of Representatives, said the crisis could have been ended, and the war easily avoided, if President Biden had simply promised not to accept Ukraine’s becoming a member of NATO. But they chose not to do so.

https://www.fmprc.gov.cn/mfa_eng/xwfw_665399/s2510_665401/2511_6654...

 

Leading experts warned NATO expansion would lead to conflict. Why did no one listen?

From Kennan to Kissinger, Western foreign-policy thinkers saw NATO’s eastward march was a dangerous game

https://www.rt.com/news/551225-nato-expansion-lead-conflict/

 

US Department of Defense 5-y Plan: Secretary of Defense Wolfowitz issued a US DoD plan for 1994 to 1999, that included the expansion of NATO, i.e., expand US geo-strategic objectives at the expense of Russia.

The US Congress approved the expansion of NATO in 1998.

Poland, Hungary and the Czech Republic were admitted to NATO in March 1999

 

NATO marched towards Russian borders, saying sovereign nations can apply and NATO members will decide, somewhat similar to becoming a member of a golf, or yacht club. 

 

That whole approach regarding the indivisibility of security in the nuclear age is totally bonkers. It ultimately led to the Ukraine situation.

 

At present, the US Government-US Media complex is repeating, ad nauseum: All this has nothing to do with NATO expansion, but everything to do with evil Putin, who:

 

1) Aims to deny Ukraine’s right to exist;

2) Aims to reestablish the greatness of Russia,

3) Hates freedom and democracy

 

If Russia’s attack on Ukraine has nothing to do with decades NATO expansions, how come so many western experts have spent decades warning NATO expansions would lead to an attack on Ukraine?

 

Spinmeister and former Ambassador to Russia, Michael McFaul, falsely claims: “This thing (i.e., NATO expansions), we were warned about for decades, was never anything anyone ever mentioned, until the end of last year” (i.e., 2021).

 

That statement is false, because numerous prominent people had warned against expanding NATO, because no one was threatening anybody, at that time.

https://www.zerohedge.com/geopolitical/experts-warned-years-nato-ex...

 

PART 1

 

New Evidence of Pledges Not to Expand NATO

 

Germany's Der Spiegel Asks: "Is Vladimir Putin Right Regarding NATO Expansion?

https://www.zerohedge.com/geopolitical/germanys-spiegel-asks-vladim...

 

The West promised not to expand NATO, beyond East Germany (the Oder River), according to a recently made-public document from the UK National Archives.

 

A newly discovered document from March 1991 shows US, UK, French, and German officials discussing a pledge made to Moscow that NATO would not expand to Poland and beyond. Its publication by the German magazine Der Spiegel on Friday comes as expansion of the US-led bloc has led to a military standoff in Eastern Europe. 

 

The minutes of a March 6, 1991 meeting in Bonn between political directors of the foreign ministries of the US, UK, France, and Germany contain multiple references to “2+4” talks on German unification in which the Western officials made it “clear” to the Soviet Union that NATO would not push into territory east of Germany. 

 

“We made it clear to the Soviet Union – in the 2+4 talks, as well as in other negotiations – that we do not intend to benefit from the withdrawal of Soviet troops from Eastern Europe”,the document quotes US Assistant Secretary of State for Europe and Canada Raymond Seitz.

 

“NATO should not expand to the east, either officially or unofficially,” Seitz added. 

A British representative also mentions the existence of a “general agreement” that membership of NATO for eastern European countries is “unacceptable.”

 

“We had made it clear during the 2+4 negotiations that we would not extend NATO beyond the Elbe [sic],” said West German diplomat Juergen Hrobog. “We could not therefore offer Poland and others membership in NATO.”

 

SEE URL

https://www.rt.com/news/549921-nato-expansion-russia-document/

 

NOTE: The UK has shut down RT, because its reporting was interfering with the Western gospel

 

PART 2

 

During a 1990 meeting, US Secretary of State James Baker assured Soviet leader Mikhail Gorbachev of the following:

 

Baker said"If the United States keeps its presence in Germany within the framework of NATO, not an inch of NATO’s present military jurisdiction will spread in an eastern direction."

 

Several years later, NATO and President Clinton began considering just such a spreading—but not without controversy.

 

1) American diplomat George Kennan, a towering figure in Cold War strategy, who authored the policy of Soviet “containment,” was unequivocal in his opposition.

 

In a 1997 essay published by The New York TimesKennan said, "Expanding NATO would be the most fateful error of American policy in the entire post-cold-war era…Such a decision may be expected…to restore the atmosphere of the cold war to East-West relations, and to impel Russian foreign policy in directions decidedly not to our liking."

 

2) A bipartisan group of 50 foreign policy luminaries—including Cold War hawks like Paul Nitze and Robert McNamara—signed an open letter to President Clinton opposing NATO expansion.

 

"Russia does not now pose a threat to its western neighbors and the nations of Central and Eastern Europe are not in danger…we believe that NATO expansion is neither necessary, nor desirable, and that this ill-conceived policy can, and should be put on hold," the group declared.

 

https://www.zerohedge.com/geopolitical/how-nato-empire-building-set...

https://www.zerohedge.com/geopolitical/tangled-tale-nato-expansion-...

 

PART 3

 

NATO did promise Moscow it wouldn't expand, former German defense official tells RT

https://www.rt.com/russia/549961-west-nato-expand-willy-wimmer/

 

Here is more evidence, the 1990-promise not to expand NATO beyond the Oder (border of East Germany and Poland), was deliberately broken by the US, using NATO as its battering ram since 1994

 

Poland, Hungary and the Czech Republic were admitted to NATO in March 1999

 

The present US/EU/NATO call for unison, is basically a call for “same-message-thinking”

 

It is a sign to the Media airing “at variance” thoughts are not welcome, even if such suppression would instigate a real war., which would give the US/EU the excuse to severely sanction Russia

 

They likely knew “stirring the bear” eventually would lead to trouble.  

 

The US has instigated lots of wars/military actions/color-revolution since 1945

 

Eisenhower warned against the power of the military-industrial complex in 1960


The image shows, NATO expansions

 

 

Maine as Third World Country:

CMP Transmission Rate Skyrockets 19.6% Due to Wind Power

 

Click here to read how the Maine ratepayer has been sold down the river by the Angus King cabal.

Maine Center For Public Interest Reporting – Three Part Series: A CRITICAL LOOK AT MAINE’S WIND ACT

******** IF LINKS BELOW DON'T WORK, GOOGLE THEM*********

(excerpts) From Part 1 – On Maine’s Wind Law “Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine if the law’s goals were met." . – Maine Center for Public Interest Reporting, August 2010 https://www.pinetreewatchdog.org/wind-power-bandwagon-hits-bumps-in-the-road-3/From Part 2 – On Wind and Oil Yet using wind energy doesn’t lower dependence on imported foreign oil. That’s because the majority of imported oil in Maine is used for heating and transportation. And switching our dependence from foreign oil to Maine-produced electricity isn’t likely to happen very soon, says Bartlett. “Right now, people can’t switch to electric cars and heating – if they did, we’d be in trouble.” So was one of the fundamental premises of the task force false, or at least misleading?" https://www.pinetreewatchdog.org/wind-swept-task-force-set-the-rules/From Part 3 – On Wind-Required New Transmission Lines Finally, the building of enormous, high-voltage transmission lines that the regional electricity system operator says are required to move substantial amounts of wind power to markets south of Maine was never even discussed by the task force – an omission that Mills said will come to haunt the state.“If you try to put 2,500 or 3,000 megawatts in northern or eastern Maine – oh, my god, try to build the transmission!” said Mills. “It’s not just the towers, it’s the lines – that’s when I begin to think that the goal is a little farfetched.” https://www.pinetreewatchdog.org/flaws-in-bill-like-skating-with-dull-skates/

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Hannah Pingree on the Maine expedited wind law

Hannah Pingree - Director of Maine's Office of Innovation and the Future

"Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine."

https://pinetreewatch.org/wind-power-bandwagon-hits-bumps-in-the-road-3/

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