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INTERNATIONAL HANDBOOK OF
ENERGY SECURITY
Hugh Dyer and Maria Julia Trombetta - 9781781007891

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International Handbook of
Energy Security
Edited by
Hugh Dyer
University of Leeds, UK
Maria Julia Trombetta

Delft University of Technology, The Netherlands
Edward Elgar
Cheltenham, UK • Northampton, MA, USA

© Hugh Dyer and Maria Julia Trombetta 2013
All rights reserved. No part of this publication may be reproduced, stored

in a retrieval system or transmitted in any form or by any means, electronic,
mechanical or photocopying, recording, or otherwise without the prior
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01
Contents
List of figures viii

List of tables x
List of contributors xi
Acknowledgements xiii
PART I INTRODUCTION
1 The concept of energy security: broadening, deepening,

transforming 3
Hugh Dyer and Maria Julia Trombetta
PART II ENERGY SECURITY ISSUES
2 Energy security and liberal democracy: ideals, imperatives

and balancing acts 19
Steve Wood
3 Framing new threats: the internal security of gas and
electricity networks in the European Union 40
Peter Zeniewski, Carlo Brancucci Martínez-Anido and
Ivan L.G. Pearson
4 Resource conflicts: energy worth fighting for? 70
Joshua Olaniyi Alabi
5 Global energy supply: scale, perception and the return to
geopolitics 92
Susanne Peters and Kirsten Westphal
PART III SECURITY OF ENERGY SUPPLY
6 Securing energy supply: strategic reserves 117

Elspeth Thomson and Augustin Boey
7 Securing energy supply II: diversification of energy sources
and carriers 133
Kas Hemmes
8 Energy security assessment framework and three case studies 146
Aleh Cherp and Jessica Jewell

vi International handbook of energy security
9 National energy strategies of major industrialized countries 174

Stephan Schott and Graham Campbell
10 Developing world: national energy strategies 206
Sylvia Gaylord and Kathleen J. Hancock
PART IV SECURITY OF ENERGY DEMAND
11 Energy demand: security for suppliers? 239

Tatiana Romanova
12 Oil producers’ perspectives on energy security 258
Gawdat Bahgat
13 Energy security governance in light of the Energy Charter
process 273
Andrei V. Belyi
PART V ENERGY, THE ENVIRONMENT AND

SECURITY
14 Governance dimensions of climate and energy security 297

John Vogler and Hannes R. Stephan
15 Energy, climate change and conflict: securitization of
migration, mitigation and geoengineering 319
Jürgen Scheffran
16 Environmental implications of energy production 345
Yolanda Lechón, Natalia Caldés and Pedro Linares
17 Washing away energy security: the vulnerability of energy
infrastructure to environmental change 386
Cleo Paskal
18 Paradoxes and harmony in the energy-climate governance
nexus 402
Stéphane La Branche
PART VI ENERGY AND HUMAN SECURITY
19 Energy poverty: access, health and welfare 423

Subhes C. Bhattacharyya
20 Ethical dimensions of renewable energy 443
Hugh Dyer
21 Low carbon development and energy security in Africa 462
Chukwumerije Okereke and Tariya Yusuf

Contents vii
22 The road not taken, round II: centralized vs. distributed

energy strategies and human security 483
Ronnie D. Lipschutz and Dustin Mulvaney
23 Human security and energy security: a sustainable energy
system as a public good 507
Sylvia I. Karlsson-Vinkhuyzen and Nigel Jollands
PART VII CONCLUSIONS
24 The political economy of energy security 529

Index 539

Figures
3.1 Generation adequacy assessment from ENTSO-E SO-AF

2012–2030 50
3.2 Projects of pan-European significance: volume breakdown
per EU energy policy pillar 53
7.1 Distribution of energy sources for the production of
electricity in 2011 for the Netherlands 134
7.2 Supply chain in an energy system 135
7.3 Simple form of multi-input systems combining fossil
energy with renewable energy by blending 139
7.4 Classification of energy systems 139
7.5 Schematic illustration of a multisource multiproduct
energy system (or energy hub) 140
7.6 Schematic representation of the Superwind concept 142
8.1 Major methodological choices in measuring energy
security and the energy systems approach 148
8.2 Vital energy systems covered in the GEA 153
8.3 Aggregate analysis of energy security in future energy
scenarios using a two-dimensional plotting 165
8.4 Energy security assessment framework 168
9.1 Russia’s primary energy consumption by fuel as a
percentage of total consumption 188
9.2 Energy mix outlook for the EU 2030 and 2050 196
9.3 U.S. primary energy consumption by fuel (quadrillion btu
per year) 197
16.1 Airborne pollutant emissions from fossil fuel fired power
plants 348
16.2 Lifecycle GHG emissions of electricity generation
technologies disaggregated by life cycle stage 371
16.3 Lifecycle NOx and SO2 emissions of electricity generation
technologies 372
16.4 Lifecycle particulate and NMVOC emissions of electricity
generation technologies 373
16.5 Lifecycle GHG emissions of bioethanol production from
different raw materials 375
16.6 Lifecycle GHG emissions of biodiesel production from
different raw materials 376
viii

Figures ix
16.7 External costs of electricity generation technologies

disaggregated by impact category 377
16.8 External costs of electricity generation technologies
disaggregated by life cycle stage 378
18.1 Climate governance versus energy governance 414
18.2 Climate/energy governance versus social acceptability 415
19.1 Major concentration of population without access to
electricity in 2009 429
19.2 Urban-rural electricity access disparity in major
concentrations in 2009 430
19.3 Ten least electrified countries in the world in 2009 430
19.4 Distribution of lack of cooking energy access in the world
in 2009 431
19.5 Share of different cooking fuels in developing countries in
2007 432
19.6 Regional distribution of countries with targets for
electricity and clean cooking energy access 434
19.7 Energy access improves with per capita income 435
19.8 HDI and electricity access 436
19.9 HDI and cooking energy access 436
19.10 Life expectancy at birth and cooking energy access 437
19.11 Mean schooling years against electricity access 437
19.12 Intervention options for reducing health impacts of solid
fuel use 440
21.1 Number of people without electricity (actual and projected)
by region under current policies 465

Tables
4.1 Civil wars, rebellion and militancy in selected oil and gas
dependent states 74
7.1 Main security of supply issues on different length scales and
time scales 137
8.1 Three perspectives on energy security 156
8.2 Indicators of crude oil supply security used in MOSES 159
8.3 Indicators used in the GEA energy security assessment 160
8.4 Vulnerabilities of future energy systems and related
indicators 161
8.5 Ranges of indicators for crude oil supply in MOSES 162
8.6 Aggregating indicators for external resilience of crude oil
supply in MOSES 164
8.7 Results of the crude oil analysis for MOSES 166
8.8 Cases of energy security assessments presented in this
chapter 170
9.1 Export-import dependence of selected countries 177
9.2 Characteristics of national energy strategies in countries
with high export and balanced export-import dependence 178
9.3 Characteristics of national energy strategies in countries
with high import dependence 192
9.4 Dramatic supply shifts in Japan by 2030 200
11.1 Key oil and gas exporting countries 240
16.1 Impact categories, pollutants and effects considered in
the ExternE methodology 369
19.1 Factor goalposts for 2010 EDI 425
19.2 Example of EDI for India 426
19.3 Commonly used national and international indicators of
energy poverty 426
19.4 Level of electrification in various regions in 2009 428
19.5 Reliance on biomass for cooking energy needs in 2009 431
19.6 Expected number of people without electricity access in 2030 433
19.7 Outlook for biomass use for cooking in 2030 (million) 433

Contributors
Joshua Olaniyi Alabi, University of Leeds, UK

Gawdat Bahgat, National Defense University, Washington, USA
Andrei V. Belyi, University of Tartu, Estonia
Subhes C. Bhattacharyya, De Montfort University, UK
Augustin Boey, National University of Singapore, Singapore
Carlo Brancucci Martínez-Anido, European Commission Joint Research
Centre, Belgium
Natalia Caldés, CIEMAT, Madrid, Spain
Graham Campbell, Carleton University, Canada
Aleh Cherp, Central European University, Hungary, and Lund University,
Sweden
Hugh Dyer, University of Leeds, UK
Sylvia Gaylord, Colorado School of Mines, USA
Kathleen J. Hancock, Colorado School of Mines, USA
Kas Hemmes, Delft University of Technology, The Netherlands
Jessica Jewell, International Institute for Applied Systems Analysis,
Austria, and Central European University, Hungary
Nigel Jollands, European Bank for Reconstruction and Development,
London, UK
Sylvia I. Karlsson-Vinkhuyzen, Wageningen University, The Netherlands
Stéphane La Branche, PACTE, Institute of Political Studies, Grenoble,
France
Yolanda Lechón, CIEMAT, Madrid, Spain
Pedro Linares, Universidad Pontificia Comillas, Spain
Ronnie D. Lipschutz, University of California, Santa Cruz, USA
Dustin Mulvaney, San Jose State University, USA
xi

xii International handbook of energy security
Chukwumerije Okereke, University of Reading, UK

Cleo Paskal, Royal Institute of International Affairs, UK
Ivan L.G. Pearson, European Commission Joint Research Centre, Belgium
Susanne Peters, Kent State University, Geneva, Switzerland
Tatiana Romanova, St. Petersburg State University, Russia
Jürgen Scheffran, University of Hamburg, Germany
Stephan Schott, Carleton University, Canada
Hannes R. Stephan, University of Stirling, Scotland, UK
Elspeth Thomson, National University of Singapore, Singapore
Maria Julia Trombetta, Delft University of Technology, The Netherlands
John Vogler, Keele University, UK
Kirsten Westphal, German Institute for International and Security Affairs
(SWP), Berlin, Germany
Steve Wood, Macquarie University, Australia
Tariya Yusuf, University of Reading, UK
Peter Zeniewski, European Commission Joint Research Centre, Belgium

Acknowledgements
The editors would like to thank Alexandra O’Connell and all the Edward
Elgar Publishing team, in particular Rebecca Wise, Jane Bayliss and
Jennifer Wilcox for their efficiency and devotion to this publication.
Many thanks are owed to the contributors, who agreed readily to the
request for contributions and dealt with editorial requests in a professional
and timely manner.
Julia Trombetta would like to thank the Energy Delta Gas Research
(EDGaR) Programme for a research grant that allowed her to work on
energy security in Europe, and the section “Economics of Infrastructures”
(Faculty of Technology Policy and Management) of the Delft University
of Technology for constant support.
xiii

PART I
INTRODUCTION

1. The concept of energy security:
broadening, deepening, transforming
Over the last decade the term energy security has gained relevance in politi-
cal and academic debates. Framing energy as a security issue is not a new
phenomenon. The last great debate on energy security dated back to the
1970s (Schultz 1973; Nye 1982) and it was prompted by the crises that fol-
lowed the cut of oil supply by OPEC countries in 1973. As the price of oil
quadrupled, triggering an economic crisis, the vulnerability of the energy
system was fully exposed (Cherp and Jewell 2011, 203). Over the subse-
quent two decades, however, energy was considered more an economic
than a security issue – at least in the main political and academic debates.
A global liquid market (for oil) and relatively low fossil fuel prices have
prioritized economic aspects, often ignoring the premises on which the
energy market has developed, and in particular how its working is shaped
by security considerations whose appropriateness is now being questioned.
Several issues are behind the questioning and the renewed concerns
and quests for energy security. Tight oil markets and volatile prices have
created concern for an affordable and secure supply of energy. Several
disruptions in gas supply determined by disputes between Russia and
various Eastern European countries have evoked the spectre of an energy
weapon and questioned the reliability of Russia. Similarly, the reliance
on potentially, or historically ‘unstable’ areas of the world for oil supplies
raises concern for energy independence in Western countries. Besides,
the transformation of energy into an issue of high politics was speeded
up by the realization that increases in oil prices since 2002 have not
only been the result of passing crises – like the war in Iraq or strikes in
Venezuela – structural changes in the global energy market were largely to
blame (Westphal 2006, 48). Growing demands from emerging economies
have changed the energy landscape and prompted traditional geopo-
litical arguments and questioned the limited mechanisms of global energy
governance. Environmental concern and raising consumption have ques-
tioned the sustainability of the existing energy system. The global security
landscape has changed as well, with growing concerns about threats from
non-state actors. In the case of energy systems they include piracy and
terrorist

attacks, including cyber ones.

4 International handbook of energy security
Energy is fundamental for the working of modern societies and that

poses political questions about access to energy services, and yet those
energy services are provided by complex technical systems and global
markets. The contemporary energy system is largely based on dwindling
fossil fuels in distant places; it involves different actors and requires long
term planning, as well as short term action; it requires different kinds
of expertise often with competing logics and perspectives. Not surpris-
ingly energy security is understood in different ways in different contexts
(Chester 2010). While the term security is largely evocative of state’s
intervention, energy security is also about the smooth function of liquid
markets and safe and reliable energy infrastructures (Cherp and Jewell
2011). Energy security is both a strategic issue and public policy issue
(Goldthau 2012), even if the two perspectives are based on different
assumptions and different instruments to provide security. While a better
understanding of the different perspectives and a broader and integrated
approach is called for, an all-encompassing concept of energy security
would lose relevance (Ciuta 2010). Yet, the existing energy system is based
on several assumptions about who is supposed to be secured, by whom
and by what means. These are the issues that are addressed by (critical)
security studies through conceptual and critical analyses.
However, despite the burgeoning literature and growing interest in
energy security, there is little from a (critical) security studies perspective
(Ciuta 2010: Cherp and Jewell 2011). On the one hand, energy security
is left to economists and engineers; on the other hand, there are a few
warnings against the transformation of energy into a security issue. The
first has led to various attempts to apply public policy tools to deal with
market failures or to measure energy insecurity, quantifying risks without
questioning who or what is supposed to be secured and how. The second
is related to a specific understanding of security as allowing exceptional
measures, including the use of force and military intervention, which is
associated with the state and raison d’état. This resonates with a zero sum,
antagonistic understanding of security, which characterizes realism and
creates concern for NATO’s involvement in energy disputes, or for the
militarization of energy (Moran and Russell 2009).
This division is reflected in the identification of two storylines for the
development of the global energy landscape by Correljé and van der
Linde (2006). The first one, based on ‘regions and empires’, describes a
world divided in rival blocs competing for resources. The second one,
‘markets and institutions’, identifies a multilateral world with effective
institutions and markets (Correljé and van der Linde 2006, 532). This
reflects, as Keating et al. (2012) have pointed out, the divide between
realist/geopolitical approaches and neoliberal ones, where the geopolitical

The concept of energy security 5
ones focus on the state and on access to resources (often ignoring the secu-
rity concerns of producer countries, emphasizing security of supply over
security of demand) while neoliberal approaches tend to focus on market
mechanisms and identify energy security with free markets (often ignoring
that liberalization can be problematic for energy security as well). In this
way the debate tends to perpetuate a rather simplistic division between
politics and economics (Keating et al. 2012, 3).
The problem is further complicated when environmental considerations
are brought into the discussion. Climate change has been considered as a
post-normal scientific issue, where the term post-normal science has been
introduced to identify a situation in which ‘facts are uncertain, values in
dispute, stakes high and decisions urgent’ (Ravetz, quoted in Friedrichs
2011). This resonates with the debate about energy security, and debates
about conceptualizations of security aspire to make these issues explicit.
However, as Friedrichs notes, while environmental debate has engaged
with post-normal science, much of the discussion about future energy
is shaped by an economic approach which implies that future energy
demand will be met by market mechanisms, and technological fixes will
always be available (Friedrichs 2011, 469). Against this challenging con-
ceptual background, this book is an attempt to bring together energy
security experts to explore the implications of framing the energy debate
in security terms, both in respect of the governance of energy systems and
the practices associated with (energy) security. It reviews and analyses the
key aspects and research issues in the emerging field of energy security. It
tests the current state of knowledge and provides suggestions for reflection
and further analysis. This involves providing an account of the multiplic-
ity of discourses and meanings of energy security and contextualizing
them. It further requires using the insights from security studies debates to
understand the implications of framing an issue as a security issue. Finally,
it means outlining the challenges and peculiarities of framing energy as a
security issue. This might suggest a rewriting of the evolution of security
discourses and their representation, especially by outlining the links with
economics and their implications.
As regards the first point, several commentators have noticed the
polysemic nature of energy security, and how the term means differ-
ent things in different contexts. In different ways, commentators have
identified how different disciplinary backgrounds shaped energy security
discourses identifying geopolitical, economic and technical perspectives
(Keppler 2007; Cherp and Jewell 2011). The renewed interest in energy
security challenges that intellectual division of labour, and calls for
integration and dialogue; however, different disciplines have different
epistemological perspectives, different understandings of what counts

as security, and how to provide it. In providing a review of the relevant

aspects of the energy security debate, it is important to explore how dif-
ferent logics of security interact and shape different energy security dis-
courses, challenging disciplinary boundaries and security practices.
The tools for understanding these transformations can be provided by
critical security studies, and this points to the second aspect character-
izing this handbook. Largely grounded in the discipline of International
Relations which considers security as a key concept to explain interaction
among states and global politics, the debate about rethinking security to
make it relevant to understand contemporary dynamics has raised funda-
mental theoretical and practical issues whose relevance goes beyond the
debate within the discipline. Since the 1980s the field of security studies
has increasingly challenged a narrow understanding of security as dealing
with the threat and use of military force in inter-states relations (Walt
1991), which has led to a broadening and a deepening in the understand-
ing of security (Rothschild 1995; Haftendorn 1991; Krause and Williams
1996). Vaughan-Williams and Peoples (2012), for example, organize their
four-volume collection, which provides an overview of the field of critical
security studies, around interrelated themes of defining, deepening, broad-
ening and extending security. Broadening refers to the expansion of the
threats and issues to be considered. Deepening invokes other entities than
the state as the referents for security, like individuals or political commu-
nities. The two dimensions are correlated since new threats calls for new
tools and new actors to counteract them. In the energy security debate this
reflects a shift from considering energy as a cause or an instrument of war,
and dealing with threats posed by external actors, mainly states, being
unreliable exporters or competitors for scarce resources, to a broader
approach that considers different kinds of threats and security provisions.
Suggesting that the state is no longer the focal point of security analysis
opens up the space for a variety of threats at different levels, from local
to global. The term energy security is itself a broadening of the security
agenda. However, once a narrow definition of security is challenged the
number of issues that can be included in the agenda becomes infinite, as
well as the entities that can call for protection. The issue then becomes how
to discern legitimate threats and, in turn, how and to what extent states are
supposed to provide security in a globalized environment. In the critical
security studies debate, these issues are related with other two aspects: the
constructions of threats (vs. their allegedly ‘objective’ discovery) and the
different logics of security (vs. the statist, exceptionalist one of national
security).
Arguing for a broader security agenda, constructivist approaches have
suggested that identifying threats is not a straightforward, objective

process. Threats are not objective entities waiting to be discovered and

counteracted, to a large extent they are the result of a process of social
construction that depicts an issue as dangerous and calls for action.
Considerations of whom or what is valuable and deserves to be protected
play a role in framing an issue as a threat and priority. So for instance, in
the case of immigration, foreigners can be represented either as a resource
or as a threat. The identification of threats is more straightforward in the
energy sector, however, a lot of social construction is at work in represent-
ing Russia as a threat to European energy security or in considering a cut
in supply as more threatening than a blackout due to lack of investment
in infrastructures. Securitization theory (Wæver 1995; Buzan et al. 1998),
which focuses on the process of social construction of a security issue
(through a successful speech act that transforms the way of dealing with
an issue), has been applied to show how appeals to energy security have
transformed energy policy.
Considering new threats and new referents is not the only challenge,
as different threats and contexts are characterized by different security
practices and logics. Securitization theory, for instance, is based on a
specific logic of security which inscribes enemies in a context, and allows
exceptional measures and the breaking of rules. It is a logic borrowed from
realism, which is evident in some of the geopolitical and resource-war
arguments that have re-emerged in the energy security debate (Correljé
and van der Linde 2006; Klare 2008). This logic is at odds with the
risk-management, cost-benefit analysis that characterizes energy policy.
So for instance the mechanisms to ensure energy security after the oil crises
in the 1970s have been identified with differentiation of supply, liberaliza-
tion of the energy system or mechanism to deal with crises like the strategic
oil reserves. Other approaches, however, have considered different logics
of security like those based on risk (Rasmussen 2001; Aradau et al 2008),
insurance mechanisms and other kinds of security apparatus (Dillon and
Lobo-Guerrero 2008). Some of them suggest an approach to security
which is based on maintaining circulation of goods and services around
normal parameters (Dillon 2008). Emergencies can occur, and to some
extent they are necessary to maintain the incentives that allow the system
to work, as far as they do not challenge the survival of the system. Part of
the challenge is to consider how the different logics interact, gain relevance
and acquire legitimacy.
Much concern about broadening the security agenda has been about
transferring a specific logic of security to sectors other than the military
(Buzan and Wæver 1998; Huysmans 2006); little has been said about
transferring other logics to the security field, such as the precautionary
approach that characterized the environmental debate, or the emphasis on

resilience (Trombetta 2010). In this way exploring the peculiarities of the

energy sector can provide useful insights into the transformation of secu-
rity practices and provisions and shed light, for instance, on the changing
role of the state as security provider.
This volume emphasizes the broadening and transforming of energy
security perspectives. The energy security agenda is broadening, and the
first extension of this agenda is to consider not only security of supply, but
also security of demand. A second extension involves considering the envi-
ronmental dimension (as illustrated in Parts III, IV and V). This environ-
mental discourse in particular reflects the limitations of the conventional
economic approach to ensuring energy security, where the economic logic
is concerned with matching supply and demand, and this is challenged by
the issues posed by environmental degradation and climate change. The
conventional response to these issues is to incorporate them within the
economic logic, where they are inevitably seen as externalities (if perhaps
giving rise to processes of ecological modernization (Hajer 1995)). The
challenge of energy security (and environmental security) is deeper, and
poses questions about whose security and by what means it may be
achieved. In this respect, the insights from security studies are relevant,
as are the debates about energy and human security, as they question and
challenge existing practices. This points to the issues raised in Part VI,
where Karlsson and Jollands’ concept of ‘deep energy security’ reflects the
aspiration of the volume to show how the concept of energy security has
broadened, deepened and transformed.
STRUCTURE
In order to review the existing debates, while dealing with the range of
issues mentioned above, the handbook is structured in seven parts includ-
ing this introduction, a conclusion and five substantive sections dealing
with different perspectives on energy security. This introduction analyses
the implications of conceptualizing energy as a security issue and frames
energy security within the contemporary debate within security studies. It
considers the theoretical issues as well as the historical evolution of what is
understood as energy security and the ways of providing it, and extends to
considerations of geopolitics, economics and technology perspectives and
governance. Thus it provides a framework for analysis based on broad-
ening, deepening and transforming the meaning of energy security and
the practices associated with it, the competing conceptual and temporal
framework that different disciplines bring to the debate, and the origin of
the existing energy security order and assumptions underpinning it.

The remaining parts explore how existing discourses are broadening,

deepening and transforming what is understood as energy security.
Parts II to VI deal with emerging energy security issues, security of
supply, security of demand and environmental security and human secu-
rity respectively. For each the key aspects and research issues are reviewed.
This is an attempt to make sense of the expansion of the energy security
debate while taking into account the multiplicity of dimensions involved.
This is certainly the result of a process of interpretation of existing trends
and literature, nevertheless it aims to explore existing discourses rather
than suggesting what energy security necessarily entails, with a view to
normative as well as practical implications.
Part II sets energy security in the context of wider challenges, such
as democratic representation, complex interdependence, potential for
conflict, and the geopolitical context. Wood suggests that presumed
energy imperatives test the quality and integrity of liberal democracy in
its external and internal dimensions, where there is a tension between
principle and pragmatism. Brancucci, Pearson and Zeniewski present
the EU as a case of challenges to network stability arising from develop-
ments in both economic and physical infrastructures, where the criteria
selected for defining energy security often inform policy. Alabi uses the
case of Nigeria to indicate the significant historical role oil has had both
in fuelling modern industrial economic development and in domestic
and international conflicts, as powerful actors adopt various strategies
to influence the direction of supply and price of oil in their own inter-
est, with implications for the modern energy security agenda. Peters and
Westphal examine the geopolitical and theoretical bases for a renewed
emphasis on energy security, with a changing landscape of energy and
the central role of prices presenting challenges for both states and
markets.
Part III provides a review and assessment of the security of supply
debate. Security of supply has been the dominant concern in the energy
security debate, which has often considered the two as being synonymous.
To a large extent concerns over security of supply are embedded in the
realist understanding of security and the role of the state in providing it;
however, what counts as security of supply is changing. Not only have new
threats gained relevance (and with them new actors and security practices),
but also security of supply is transforming into security of energy services
(Faas et al 2011). This part analyses security mechanisms of diversification
and strategic reserves, reviews approaches to measuring energy security,
and explores different national energy strategies. Thomson and Boey indi-
cate the buffering role of energy reserves, and explore the tension between
genuine security and mere stability, given that supply or price shocks are

harmful to both developed and developing economies. Cherp and Jewel

outline a systematic framework for measuring energy security, with defini-
tional issues presented in historical context, in order to test the prospects
for a common measure to help deal with the complex interconnectedness
of energy security. Schott and Campbell examine the structure of national
energy strategies among the G8 countries and Norway, and evaluate the
compatibility of different strategies with an emerging world energy order.
Gaylord and Hancock note that energy strategies are particularly relevant
to the developing world, with limited finance and other capacities inform-
ing the primary concerns of increasing electricity access and long-term
economic development.
Part IV deals with security of demand. This is an issue that has been
raised by producer countries, concerned with price volatility and invest-
ments. This suggests that expanding the energy security agenda is not only
about broadening the list of potential threats but also about including
different dynamics and referents. Concerns for security of demand sug-
gests interest in a less antagonist logic of security, implying a shift from
a zero sum approach in which ‘my security is your insecurity’ to a more
cooperative one in which one’s security depends on the security of others.
This, in turn, calls for different security practices and provisions. This
part covers issues such as the perspectives of different producer countries,
and institutional arrangements producing countries’ political objectives,
where interests and concerns are expressed by both individual produc-
ing countries and by organizations that bring them together, given the
interconnectedness of supply security and demand security. Bahgat gives
the International Energy Forum as an example of cooperation between
producers and consumers, which is necessitated by a global mismatch
between consumption and production which has made energy products
the world’s largest traded commodities. Belyi assesses opportunities for
energy security governance in the context of the Energy Charter Treaty,
given that in a state-centered view energy security is a factor in the
unpredictability of international relations.
Part V deals with the environmental dimension of the energy secu-
rity debate. The growing demand for energy and reliance on fossil fuels
make the existing energy system unsustainable. The awareness of global
warming and its implications have gained relevance and are a challenge
to energy policies. In the EU, for instance, concerns for security of supply
and for global warming have jointly contributed to the development of
a common energy policy. However, environmental security and energy
security – while strictly related and often invoked jointly to promote action
on either the environmental or the energy side – can be at odds. Also,
while global warming has become the main environmental concern in the

energy debate, contemporary energy systems are responsible for a variety

of environmental impacts, such as acid rain, and soil and water con-
tamination. A secure and sustainable energy system cannot ignore these
dimensions and several issues have begun to emerge. This part includes
contributions on the cross-pollination and compatibility of environmental
and energy security discourses, and on the environmental impacts of the
energy sector and their security implications. Vogler and Stephan test the
governance challenges arising from an expansive re-definition of security
in which energy and climate are not only materially intertwined, but also
interdependent politically. Scheffran notes that energy security depends
on its geographical and geopolitical context, as the components of the
energy mix shape the global conflict landscape, and climate change issues
shape securitization discourses. Lechon, Caldés and Linares examine
the environmental implications of energy technology investment and
operational decisions, and discuss methods to quantify environmental
implications and externalities of energy technologies. Paskal discusses the
vulnerability of energy infrastructure to environmental change, given that
much energy infrastructure lies in areas that are becoming increasingly
physically unstable. La Branche explores the paradoxes and harmonies in
the energy-climate nexus, given that climate change is seen as an accelera-
tor and amplifier of natural risks and the single most important obstacle
to development efforts in the third world.
Part VI on human security shifts the focus from the security of the
state (if still instrumental) to that of individuals and the protection of
their basic rights. It suggests a broader, non-zero-sum understanding of
security which includes different dimensions, such as income security,
food security, health security, environmental security, community/iden-
tity security and security of political freedom as specified by the UNDP’s
report first using the term (UNDP 1994) (Hampson et al. 2002). Energy
security is not mentioned in the UNDP’s list, however energy has a perva-
sive role in contemporary society: energy is ‘not just another commodity,
but the precondition of all commodities, a basic factor equal with air,
water, and earth’ (Schumacher, quoted in Sovacool and Mukherjee 2011,
5343). Ensuring access to energy services is fundamental to human secu-
rity. And yet, ‘two billion human beings –almost one-third of the planet
population – experience evening light by candle, oil lamp, or open fire,
reminding us that energy modernization has left intact – and sometime
exacerbated – social inequalities that its architects promised would be
banished’ (Byrne and Toly 2007: 1; Smil 2003: 370–73). If security is eman-
cipation (Booth 1991) ensuring access to energy services can certainly
contribute to the fulfilment of human potential, but decarbonizing the
energy system while assuring universal access to modern forms of energy

represents a paramount challenge with implications for energy security

(AGECC 2010). Securing access to energy services, however, is not only
an issue for developing countries: the challenge of sustainable energy, and
transition to a low carbon economy and decentralized energy systems,
poses questions about priorities and reliability of services. Are energy serv-
ices a public good? Who is supposed to ensure supply in a decentralized
system where consumers are also producers? This part provides contribu-
tions on energy as human security, on the policy and ethical implications
of shifting security considerations from the state to individuals (e.g. is EU
energy policy shifting from national to human security?), on the debate
about energy services as public goods, and on the role of the UN in
promoting access to energy (and energy governance) to increase human
security. Bhattacharyya presents the energy poverty debate and discusses
the link between energy poverty and health and welfare, mainly in the
developing countries where the implications of lack of access to energy for
health and social welfare link energy poverty with human development
and economic development. Dyer assumes that justice and equity must
underwrite the feasibility of any energy strategies, requiring an ethical
framework for energy which addresses the lack of human security in
allocations of limited resources, in which an ecological ethic more directly
reflects the limits we face and renewable energy offers some promise.
Okereke and Yusuf observe that energy poverty is a critical development
challenge for Africa, where most do not have access to electricity but
depend on biomass for their basic energy needs, and suggest that a low
carbon development path offers the prospect of achieving energy security
while contributing to the global effort to fight climate change. Lipschutz
and Mulvaney note that socio-technical systems, such as those that make
possible electrification, have social tendencies independent of human
intention with differing technological paths having different kinds of
social impacts and, by extension, effects on human well-being and secu-
rity. In the context of rising risks and impacts of continued reliance on
fossil fuels and nuclear energy they provide a comparative assessment of
the impacts of centralized and decentralized energy sources and strategies.
Karlsson and Jollands note the entrapment of energy policymaking within
the paradigm of national security and suggest that linking the sustainabil-
ity of the energy system with the human security paradigm can address
this constraint, and offer the idea of ‘deep energy security’ to introduce an
ethical basis for sustainability.
The editors’ conclusion then seeks to capture the range of contributions
made in this volume to understanding the emerging political economy of
energy security.

CONCLUSION
The various dimensions of a larger security agenda are taken as a

framework to explore the problems and implications involved in the
contemporary energy security debate. This book aims to capture the main
dimensions of the debate, while providing an analytical framework to
explore how different security practices and logics emerge, are legitimized,
or are challenged and resisted. Winzer (2011) noted the obvious point that
the conceptual framing of research has considerable impact on results in
attempting to quantify energy security; in order to distinguish between
security, sustainability and economic efficiency (and avoid securitization),
he proposes the term ‘energy supply continuity’ in respect of commodities,
services and economic activity, while acknowledging that other energy
security concerns will remain. This volume will show that energy security
extends far beyond security of supply, and cannot easily be segregated
from broader policy concerns. A broadening security agenda is related to
its deepening, and can impact on security practices and logics. The broad-
ening of the energy security discourse along the lines of security of supply,
security of demand and environmental and human dimensions, indicates
the significance of framing energy as an economic issue in current political
debates. The interest in security of supply and security of demand sug-
gests an attempt to provide equilibrium in the market, emphasizing the
relevance of interdependence and of neoliberal approaches to security
provisions (see Dillon 2005). Indeed the larger challenge which energy
security concerns reflect may itself be subject to conceptual development:
Kanninen’s (2012) historical examination of the ‘limits to growth’ suggests
a paradigm shift from ‘sustainability’ to ‘survivability’ as global spatial
constraints are joined by temporal ones, such as climate change. From the
neoliberal perspective, for example, the inclusion of environmental aspects
suggests a concern for eliminating externalities. However, the challenge of
energy security in both theory and practice is far greater than could be met
by a simple adjustment to current theory and practice.
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PART II
ENERGY SECURITY
ISSUES

2. Energy security and liberal democracy:
ideals, imperatives and balancing acts
Steve Wood
1 INTRODUCTION
Contemporary juxtapositions of energy security and liberal democracy

are, subtly or dramatically, changing understandings of both. Presumed
energy imperatives test the quality and integrity of the liberal democracy
that defines most post-industrial societies. This pertains not so much to their
domestic functioning – though this is also under stress – as their capacity
and will to uphold the values of that philosophy globally. A growing body of
inquiry into political and normative dimensions accompanies technical and
econometric analyses of resource demand and extraction. Uncomfortable
circumstances envelop multifaceted questions: how much and what forms
of energy do populations, business and industry, and state sectors need;
what should be done to ensure this; how are environmental, job, and
societal security affected; what is the order of priority, and how is it deter-
mined? Media attention accentuates the existential, economic and political
sensitivities that permeate this commotion of factors and possibilities.
While this chapter recognises the frequent intersecting of domestic
and foreign affairs, for organisational purposes it designates external
and internal dimensions. The external concerns relations between liberal
democracies and illiberal regimes where energy is a consideration: an illib-
eral regime possesses resources that a liberal democracy wants, it controls
access to or transit of such, or otherwise influences their supply in ways that
have impact, including through pressure on a liberal democracy’s partners
and allies. The internal pertains to how electoral ambitions, public atti-
tudes, and economic constraints, affect energy policy in individual polities.
It is a field of tension between ‘principled’ and ‘pragmatic’ responses, from
parties and publics (cf. Tavits 2007). Occasionally this tension becomes
acute. Governments may be confronted with the convergence and inten-
sification of external and internal pressures. Such situations could involve
dependency on illiberal regimes for oil or gas, and on indigenous coal or
nuclear power. Sections of electorates may oppose one or other, or both
options, without proposing viable alternatives. Conversely, majorities
may accept them as reasonable, or undesired but requisite.
19

The challenge to resolve these political, strategic, economic, security,

technical, and normative problems is not about to recede. One foreword
in a major volume noted, ‘since the Industrial Revolution, energy and the
need to secure its supply have been fundamental to any position of power
in the world’, ‘wind, solar, and nuclear power remain limited alternatives’,
and ‘a hydrogen-based economy’ is ‘decades away’ (Schlesinger 2005: xiii).
‘Energy’, ‘security’ and ‘power’ form a triangular bond exerting pervasive
influence in world politics. ‘Values’ further complicate and intensify the
predicaments facing liberal democratic states and societies.
2 THE EXTERNAL DIMENSION
2.1 Liberal Democratic and Illiberal Regimes
This section aims to clarify terms and assumptions, not to provide an

extensive examination and critique. Democracy is presented here as a
‘liberal’ version of that concept, meaning that besides popular election,
certain features of civil and political life are guaranteed, including freedom
of association, speech and opinion, a free media, an independent judici-
ary, rights to private property, and that elections are regular, free and
fair. ‘Liberal democracy’ is understood as an ideal type, because nothing
so complex operates perfectly and entirely predictably in practice. Easton
(1965), Dahl (1971), Bollen (1993), Bollen and Paxton (2000) and Munck
and Verkuilen (2002), offer definitions and analyses, discussion of compo-
nents, quantitative measurements and taxonomies. Downs’ (1957) influ-
ential ‘economic theory’ argued that liberal democracy was characterised
by the attempts of parties to maximise votes, win elections and enjoy the
‘intrinsic rewards of holding office’, while citizens make decisions based
on perceived self-interest. Employing a survey of 36 states, Kotzian (2011:
24) informed that ‘support for liberal democracy is contingent on eco-
nomic growth being sustained . . . economic performance matters more
than institutional and political developments’. Energy requirements, and
the opportunities for profit or influence they enable, have sometimes, if
not in the magnitudes typical of illiberal regimes, conspired to circumvent
or degrade institutional probity. This includes climate change strate-
gies, where enormous funds are at stake (cf. Hopkin 1997; Transparency
International 2007; Transparency International 2011).
The incidence of the liberal democratic form of polity has varied.
So-called ‘waves’ of democratisation (Huntingdon 1991; Kurzman
1998; Przeworski et al. 2000) reached many states, without excluding
relapse or regression. Academics, think tanks and international and

Energy security and liberal democracy 21
non-governmental organisations monitor the functioning, quality or

absence of liberal democracy. Its alternates, and sometimes antagonists,
are illiberal regimes. These do not hold free and fair elections, have no
genuine separation of powers and suppress real or fabricated opponents.
Peaceful replacement of rulers rarely occurs. Whether individual, dynastic
or juntas, these are coerced to leave, are forcefully eliminated or remain in
office until terminated by nature. Most raw materials needed for energy,
as currently created, are located in the territories of such regimes. Some
dispute land and marine regions where sovereignty is not conclusively
established (Daly 2011; Fogarty 2011; Dosch 2011; Mail Online 2007;
Catley and Keliat 1997), attempting to expand the volume and spatial
scope of their resource base. Liberal and illiberal states are also active in
poorer countries (Taylor 2006; McSherry 2006; Koike et al. 2008), where
energy competition has an accompanying secondary contest of political
systems and political culture.
The nominal obligation of liberal democracies to uphold univer-
sal values, prominently as advocates and defenders of human rights,
is one element of a dilemma. A less important effect is accusations of
‘neo-imperialism’ directed at democracy promotion endeavours (Youngs
2011a). More serious is the leverage exerted by authoritarian oil or gas pro-
ducers. Dealings of liberal democratic governments with autocracies and
theocracies suggest that the clash between values and material-strategic
interests has been decided. These arrangements demonstrate that selec-
tivity is a more crucial feature of politics than consistency, especially in
foreign affairs. The US sustains the House of Saud, a regime rating near
the bottom of political rights and civil liberties indices, while overthrow-
ing neighbouring tyrants. European Union (EU) states consorted with
Gaddafi, another of the worst human rights transgressors, for years
before becoming active or complicit partners in his removal. Others abhor
similar violations and sell energy resources to China, a ‘hardline auto
cracy’ (Bertelsmann Stiftung 2012; Freedom House 2012; Human Rights
Watch 2011).
2.2 Energy crises, Peak Oil, Scarcity
Many scholarly studies, government reports, industry assessments and

other works have analysed energy crises, or, ‘the energy crisis’ (Hussey
1974; Williams and Alhaji 2003; Campbell 2005; Newman 2008; Heinberg
2009). Key elements recur: the estimated remaining quantities of a
resource viewed as essential: low or rapidly reducing; the availability of
that resource and its assured supply: under threat; the price of the resource:
already high, rising, fluctuating. Data influencing the declaration of a

‘crisis’ might not be reliable and complete, leaving best guess scenarios.
Politics is sometimes a better guide than geological or economic indicators.
Energy crises are often linked with ‘peak oil’, for which a plausible
consensus forms around 2000 to 2010 (Hubbert 1949; Hubbert 1956;
Aleklett and Campbell 2003). Global production of conventional oil was
steady over that decade: 64 million barrels per day (Mb/d) in 2000 and
63 Mb/d in 2010. The two biggest producers, Russia and Saudi Arabia,
reached outputs between 8.3 and 8.8 Mb/D. These volumes will gradu-
ally reduce. Iraq, Kazakhstan and the United Arab Emirates are likely to
increase production until 2020. The US, UK, Canada and Norway have
passed dates of peak exploration, discovery and production for conven-
tional oil (Campbell 2011). The story is similar in conventional gas, with
some divergences. In 2010, Russia and the US each produced 23 trillion
cubic feet (tcf). By 2020, Russia will be dominant, producing 30 tcf. US
volume will drop to 8.5 tcf. Qatar, Saudi Arabia, China, Turkmenistan
and Kazakhstan, which will remain illiberal indefinitely, will increase
production. Australian production will also increase, from 1.8 tcf in 2010
to 4.8 tcf in 2020. Production in Canada, the Netherlands and the UK will
decrease. Some states, whose political direction, economic orientation and
stability are very unclear, including Nigeria and Egypt, are predicted to
increase production (Campbell 2011; Energy Information Agency 2011a;
Energy Information Agency 2011b; BP 2011).
The inexorable energy thirst of China, India and other new industrialis-
ers is another vector of international pressure. China’s Communist Party
(CCP) will try to incorporate these needs in ways that assist it to maintain
authoritarian rule. India is challenged to prevent the impetus for economic
growth, and the aligned requirement for enormous amounts of energy,
from threatening its liberal democratic credentials. Both will compete for
scarcer raw materials.
2.3. The Resource Curse
One version of the resource curse phenomenon is that conceptualised as

a problem of ‘crowding’, whereby energy and mining sectors dominate
an economy to the extent that other industries, and especially services,
are excluded or suffocated (Sachs and Warner 2001; Auty 2001). Another
version equates richness in resources with a virtual absence of political
rights and widespread poverty (Collier and Hoeffler 2005). A third inter-
pretation emphasises the quality of institutions, economic and political,
as decisive (Mehlum et al. 2006). Ross (2001) investigated the proposi-
tion ‘does oil hinder democracy’, testing three possible explanations or
‘effects’: ‘rentier’, ‘repression’ and ‘modernization’. He concluded that

oil does tend to hinder (liberal) democracy, but with some qualifications.
Ross’s modelling suggests that ‘oil harms democracy more in poorer coun-
tries than in rich ones’. Windfall profits through oil or mineral discoveries
would also damage democracy, or its prospects, in poor countries more
than rich ones, for which there are ‘no discernible effects’.
Many resource-rich states are illiberal and some extremely so. But this
is not universal. Canada, Australia and the US have substantial resources,
even if the US has depleted much of its conventional oil. Resource curses
occur where atavistic political structures coincide with valuable geological
deposits. To counter the efforts of a few liberal democratic governments
and NGOs to transform them, the rulers of illiberal states exploit resources
to retain power. Though it always entails costs, a liberal democratic direc-
tion reduces the prospect of a resource curse afflicting a developing or
transitional country. Political culture is more important than income
levels or the configuration of economies.
2.4 Security
Energy is a component in diversification of the security concept, beyond

a military-state focus, into security concepts. An early alternative per-
spective was ‘human security’, conceived by Blatz (1966) as a condition
related to the control or surmounting of anxiety. International relations
scholars, sociologists, development specialists and others expanded on this
breakthrough, adding environmental, job and societal security (Wæver et
al. 1993; Lipschutz 1995; McSweeney 1999; COT et al. 2007). Increases
in resource prices and reduced reliability of supply coincided with rising
interest in ‘energy security’. Most other security notions are connected,
given energy’s central importance to modern or industrialising societies.
Anxiety is also a common if latent ingredient.
The emergence of new ideas on security does not necessitate the aban-
donment of rationalist or statist interpretations; for government analysts
and policymakers it will not. The confluence of location and type of politi-
cal system is critical. ‘Traditional’ geopolitical aspects remain relevant
because of the global distribution of raw materials and transit routes.
This makes Goldwyn and Billig’s (2005: 514) observation that, ‘For the
United States, price shocks are the modern threat to energy and economic
security’, interesting. Perhaps reflecting presumptions that the US has
other options, analyses focusing on prices generally do not posit illiberal
regimes as a security problem. Elevating financial and economic costs in
determinations of whether energy is considered secure or not downplays
the geopolitics that US policymakers and analysts are criticised for overly
concentrating on. A Strategic Protection Reserve (SPR) can, for a period,

mitigate financial-economic and political-geostrategic concerns, but it

cannot be a lasting solution.
European academics and policy intellectuals tend to have more elabo-
rate and sometimes utopian conceptions of security than those in the
US. The EU has discovered that such cogitations do not have great
resonance in practice. Youngs (2010) explains that ‘The EU has con-
structed an impressively comprehensive edifice predicated on a singular
line of reasoning: politics matter to security . . . In theory, democracy is
diplomacy’s multi-purpose tool . . . the remedy to a host of soft security
challenges, including . . . energy supplies.’ Rethinking security is an admi-
rable intellectual endeavour that has also fed disingenuousness in some
critiques of US policy, contemporaneous to other societies relying on it to
ensure a supply of oil. The US, the EU and its member states are all osten-
sibly defenders and extenders of liberal democracy, and concomitantly
seek to maintain vital interests. Downs (1957) emphasised an enigmatic
influence, very applicable to security and energy affairs: uncertainty (cf.
Trombetta 2007). Uncertainty precipitates and prolongs crises. It makes
government, business and academic attention to energy security de facto
an interest in or concern about insecurity (Wæver 1998). If most deposits
and transit routes were located in and between liberal democracies, one
problem would be resolved. There would be less disquiet about ‘energy
security’.
2.5 The US
In 1950 the US had zero net energy imports. It produced about 5Mb/d of
oil, most for domestic consumption. In 1970 it reached a production peak
of just over 10Mb/d. By 2008 it had dropped to 7Mb/d. Imports rose to 60
per cent of consumption, then fell to 53 per cent in 2010. Depletion of US
oil coincided with rising dependence on Middle Eastern regimes, manipu-
lation by them and military involvement in the region. Removing Saddam
Hussein had its justifications but the risks of doing so would not have been
accepted without the belief that indigenous US oil was lacking, continued
dependency on that commodity, and external producer intransigence.
Similar embroilments are possible as long as a variant on that nexus exists
(cf. Klare 2004; Heinberg 2004; Peters 2004). Some statistics (cf. Energy
Information Agency 2011a), however, raise questions on whether Iraqi
oil was so necessary. Before and during the 1973–74 shocks, Canada was
the US’s largest supplier of petroleum products. It has been the largest
since 2000. Mexico became the second largest, surpassing Saudi Arabia.
In 1990, when US oil imports from Iraq were at their highest, the quan-
tity was smaller than that from Canada and Mexico. They declined again

after 2003, while those from Nigeria, Venezuela and Russia, hardly model
liberal democracies, increased.
Kalicki and Goldwyn’s (2005) compilation, written mainly from US
perspectives, contains little direct treatment on how energy concerns affect
liberal democracy. In places this is implicit, in the sense that regimes with
influence over prices or supply could cause material difficulties for the
US, rather than challenge its proclaimed political values. Other scenarios
suggest that the US could again become the largest oil producer. This
may involve a change in the definition of oil (Oil Drum 2011). If shale oil
becomes viable, or discoveries lead to rises in conventional production,
or energy efficiency is dramatically improved, it can be anticipated that
US pressure for reform on illiberal regimes, which have relied on energy
resources to avoid it, will intensify.
Until these as yet hypothetical scenarios transpire, the US will proceed
with a diversification strategy, both in forms of energy generation and
the geographic regions from which resources are obtained. Conventional
oil remains a major part of the agenda. In the Marxist-realist analyses of
Stokes and Raphael (2010; 2011), a counter to Kalicki and Goldwyn’s
volume of largely liberal-realist viewpoints, Africa and Latin America are
among the prominent targets in a global search-and-secure-oil strategy.
A few details might lend additional perspective to both of these orienta-
tions. Africa provides about 10 per cent of US oil consumption and Latin
America less than 20 per cent. Almost 40 per cent is produced in the US,
where in 2011 total petroleum products exceeded total imports for the first
time since 1949 (Energy Information Agency 2012a).
Among the Latin American suppliers of crude oil to the US, Mexico is
the largest. Diplomatically and rhetorically, there is a marked divergence
in relations with the US between antagonistic Venezuela, its second largest
crude oil supplier, and Venezuela’s neighbour, the more US-friendly
Colombia. Yet 43 per cent of Venezuelan oil exports go to the US. For
the US, imports from Venezuela have halved from about 16 per cent in
the mid-1990s to 8 per cent in 2010 (Energy Information Agency 2011c).
Colombia has slipped under the radar somewhat as a rising energy pro-
ducer. Oil and coal are its main exports, with the US the biggest importer
of both. The gas industry is also growing (Energy Information Agency
2012b). While the government of the late President Hugo Chavez nation-
alised or otherwise controlled much of the oil industry within Venezuela’s
borders, Colombia’s energy sector has experienced privatisation and
liberalisation. Contrasting developments in the two states have been influ-
enced by relations with the US. Others, including China and Iran, are also
interested.

2.6 The EU
The most difficult balancing act of maintaining energy security and

actively defending liberal democratic values is that experienced by the
institutions, member states and populations of the EU. The EU is more
exposed than most political entities in material and ideational-value terms.
Its members have relatively little oil or gas, it is a champion of clean-green
energy and environmental protection and in 2011 the governing coalition
of its largest state, Germany, declared an apparently definitive phase-out
from nuclear power. Its populations want jobs, high quality services and
comfortable lifestyles, dependent on economic growth and reliable energy,
of which the EU is the world’s third largest consumer. Concurrently,
the EU is presented as the world’s chief promoter of normative political
change, towards a social-liberal-humanitarian expression of justice and
order.
Are all these demands and preferences simultaneously possible?
According to Duke (2010: 329) ‘the mixed response from all parties [to
the Russia-Georgia war] can be explained by a number of reasons, such as
domestic factors, energy supplies and geopolitics’. And:
Normative power is less likely to be asserted when there is a strategic interest to

be advanced. The Nigeria and Russia cases illustrated that the presence of clear
strategic interests, such as secure and dependable energy supplies, can push
normative considerations to the back seat. (Duke 2010: 333)
This exemplifies disjunction of normative preferences and material-

strategic imperatives: when adhesive binding values and policy begins
to dissolve and publics are left with rhetoric, part of the stock-in-trade
of governmental or institutional pragmatism. In such scenarios, ‘policy’
means inaction or divergent action (cf. Zimmermann 2008; Wood 2009b,
2011; Mattlin 2010). A European Development Co-operation project
(FRIDE 2011) summarised: ‘Democratic governance does not appear as a
main driver for EU developing policy in many producer states that remain
authoritarian and marred by deep internal poverty . . . not only in Russia
and the Middle East but also in Central Asia and Africa’. Energy security
suffers what Youngs (2010) terms ‘single issue syndrome’, which results in
a ‘parcelled up approach’, whereby ‘energy questions and deliberation on
democracy support are simply not linked up within EU policy-making’:
In several countries, such as Russia and Iran, it is clear that the conjoining of
economic and political power causes profound problems for energy security
. . . EU policy limits itself to improving governance standards in other coun-
tries’ energy sectors . . . ringfenced from systemic-level political problems and
considerations.

An EU official (author interview 2008) explained that there are ‘two

essential problems’:
we don’t have a common energy policy – there is one in practice but not in name
– nor the means in law to enforce one. We don’t have a common democracy
policy; that doesn’t mean we don’t do democracy support, it is done through
other means, à la carte and ad hoc . . . 27 member states have 27 traditions of
democracy, with different understandings of what it means and what it means
to support it.
According to Giuli (2011: 2), altering EU-Russia interdependence ‘would

reduce the incentives for the Russian leadership to move towards a more
open and rule-of-law-based society’. He opposes a phase-out of oil or
‘diversification options’. The latter would ‘make the EU dependent on
countries even less democratic than Russia . . . reduce the rent of someone
to increase the rent of someone else has clearly little to do with the aim
of making energy security and democracy consistent’. Guili optimisti-
cally proposes that the EU-Russia energy dialogue be ‘de-politicised’ and
‘restructured’:
the high political sensitiveness of concepts such as ‘energy security’ and

‘democratisation’ can only be detrimental to this process, but the unavoidable
spill-over of preferential cooperation will necessarily translate into both energy
security [and] more political openness. (Giuli 2011: 5)
EU membership is not prioritised when energy imperatives are at issue.

European states tend to pursue a traditional course: their own ‘national
interests’, sometimes in cooperation with others.
2.7 Russia and Central Asia
Contemporary Russia is characterised by authoritarian-nationalist rule:

a ‘sovereign democracy’ without real political choice, and potentially
without other liberties if the wrong people are opposed. Vladimir Putin,
alternately occupying the offices of president or prime minister, aimed at
resurgence based on the nationalisation of energy resources, production,
transportation and exports. He took over management of this sphere. The
clique around him disavows liberal democracy as the system of interfer-
ing external powers, among which only the US is capable and marginally
willing to challenge the Russian establishment over internal governance
or in its’ ‘near abroad’. George Bush II did not risk war over Georgia in
2008, where energy resources and transit were again involved. The EU
and its member states, with a partial exception for the UK, will do little
of substance. Putin’s posturing has appealed to others, such as Chavez in

Venezuela. While it is unsurprising that they viewed each other as allies,

relations with their ‘enemies’ again betrayed contradictions. The US pur-
chases oil from Venezuela, as does the EU from Russia. Each pairing are
simultaneously adversaries and business partners.
Building engagement with Central Asian states could relativise Russia’s
position and alleviate some of the coercion it is able to impose on the
EU. This also has its price. Boonstra (2011) restates persisting EU dilem-
mas and offers recommendations. The relevant interlocutors are aware
of the restrictions and imperatives determining how the EU operates.
Turkmenistan and Uzbekistan are rated 164 and 165 out of 167 states in
one liberal democracy index (Economist Intelligence Unit 2010) and simi-
larly evaluated by others. Some EU states interpret Central Asia’s energy
wealth as compelling tolerance of regional rulers’ illiberalism, and this
perspective prevails.
2.8 China
Contemporary China presents the liberal democratic world with

apparently intractable quandaries. While the US, EU states, Japan
and others have no desire for China to become omnipotent, its
near double-figure annual growth is now depended on for their own
economic welfare. They also want to restrain China from emitting
ever-increasing quantities of CO2. Appeals have little effect unless the
CCP perceives benefits. It manipulates China’s international status:
UNSC permanent member (with attendant rights and privileges);
‘developing country’ (with associated concessions and assistance);
and leading exporter, investment seeker and provider and stockpiler
of foreign currency reserves. China’s national ambition is contingent
on reliable, high volume, energy supplies. Western governments and
commercial entities usually have formal legal and political conditions,
reportable in parliaments and in national and global media, to contend
with. China has practical advantages in that it is not constrained by
internal governance, civil rights and political liberties when energy
opportunities are identified. African freedom movements, now in politi-
cal power, exploit China as a counterweight to former European colo-
nialists and exchange resource extraction rights for Chinese investment
(Frankfurter Allgemeine Zeitung 2012a).
The urgency with which its rulers attempt to secure long-term access to
raw materials signals that energy may still become China’s Achilles heel.
Li (2008) argues that China is ‘likely to face an insurmountable energy
crisis beyond 2020’. Shortages could even compel a democratic turn if the
8–10 per cent growth, upon which the authoritarian political class relies,

is restrained. The civil disobedience which this would incite would build a
momentum unstoppable even for China’s rulers.
2.9 The Middle East and the ‘Arab Spring’
Contradictory and tense are two descriptors that could be applied to rela-
tions between liberal democracies and Middle Eastern oil producers. In
the wake of the first big oil shocks, Paust and Blaustein (1974) proclaimed
the ‘Arab oil weapon’ as a ‘threat to international peace’. West (2005)
outlined that the ‘legitimacy’ of the Saudi Arabian regime is based on
the accrual and (piecemeal) domestic distribution of oil revenues, and the
provision of security, including at Mecca and Medina. Despite an ‘interde-
pendence’ with the US, the Saudi government assisted al Qaeda members
to avoid capture in Afghanistan, even offering them ‘jobs in the public
sector’ (West 2005: 199). A reform process begun in 2003 had stalled by
2005. The ‘Arab Spring’ of 2011 threatened to restart it in a less control-
lable manner. Common to most individual cases is a confluence of politi-
cal upheaval and the presence of oil and/or gas reserves. Western states
assisted in, or did not prevent, the removal of several autocracies, but
what the revolutions of 2011–2013 will lead to – a quasi-liberal-democratic
politics and governance; the replacement of old-style despots and tyrants
by other brands of illiberal rule; or something else – is obscure. Revised
energy production and supply arrangements involving cooperation with
western states and companies are also unclear. Were Israel to become a
‘major energy producer’ (King 2011) it would recast more than regional
affairs. Some distance to the south, China has experimented with media-
tion in intra-Sudan conflicts (Economist 2012a). Against this background,
Youngs (2011b) argues that in its regional policy, the EU must become
more ‘realist’, and less concerned about ‘political incorrectness’.
3 INTERNAL DIMENSION
Energy also has extensive political effects within liberal democracies.

Agency is a feature of this system, as are positions and outcomes that many
voters disagree with. Electoral majorities may opt to continue using coal,
or to support military interventions to sustain oil supplies. Despite the
proliferation of transnational movements and networks, liberal democ-
racy functions in state jurisdictions, rather than a common globalism. Far
left and far right oppose the intrusion of foreign forces into national poli-
ties. They assert that this degrades democracy, implicitly extending to state
borders rather than crossing them. Concurrently, some of the same people

advocate global action on climate change, or oppose wars fought partly to

secure oil or gas sources. What then – if they do not concur – is the greater
necessity: political freedoms and the implementation of majority prefer-
ences; or planetary conservation, pacifism, and other ‘global goods’?
3.1 Climate Change/Global Warming, CO2 Emissions, RES and All That
Uncertainty is not only relevant to politics and security. Who, for example,
predicted the Tohoku-Oki earthquake and tsunami, or can say precisely
how much of a resource is left? Uncertainty also applies to climate change/
global warming, the modulations, variables and measurements of which
are beyond the understanding of many involved politically, on any side
(Knorr 2009; Scafetta and West 2008). If energy use has a major impact
on higher temperatures, what are the most pertinent and exact figures? In
liberal democracies, energy efficiency has improved over the past century,
as CO2 emissions have increased. Whatever facts are or may be proven,
political responses to developments in the physical world are largely
national, reflected in taxes, subsidies and regulations. For many citizens,
foreign attempts to influence directions are unwelcome, even denounced.
Global perspectives and decisions are restricted.
In Australia, energy and environmental policy are intensely politicised.
The country’s fortunes are influenced, though not overwhelmingly, by
its export of coal and other resources and their domestic consump-
tion. After the election victory of the Labor Party (ALP) in 2007, it was
expected that a raft of green measures would be implemented. New prime
minister, Kevin Rudd, announced climate change as ‘the great moral
challenge of our generation’. As the 2010 election approached, the gov-
ernment detected a groundswell of aversion to the Emissions Trading
Scheme (ETS) that Rudd had proposed. A leader of the opposition
Liberal Party (LPA) had been discarded for adopting a similar approach.
Rudd’s response to popular and business discontent, and the failure at
Copenhagen, was to ‘delay’ the ETS. But many supported it. Rudd’s party
duly deposed him. The election returned a minority ALP government,
dependent on Greens and independents. A ‘super profits resource tax’
floated under Rudd metamorphosed into a ‘mining tax’ under his succes-
sor, Julia Gillard. This targeted coal, iron ore and ‘big’ miners (Economist
2012b). It preceded a more controversial ‘carbon tax’, introduced in July
2012. In the same month Gillard declared that Australia would be depend-
ent on fossil fuels ‘for a long time to come’ (Ludlow 2012). The opposition
says that if elected it will repeal the tax and require definitive international
action before embarking on major CO2 reduction schemes that ‘damage
the economy’.

Canada is well positioned with energy options. It is in the world’s top

three exporters of natural gas and the top 10 of crude oil, is second for
hydro-generated and among the top ten in nuclear-generated electricity.
It also has copious tar sand reserves. Its main customer, the US, is one of
the world’s two largest energy consumers, is contiguous and is a liberal
democracy. Despite the further wealth that could be created, public atti-
tudes are ambivalent. Much of the electorate is concerned about ecologi-
cal damage through new pipeline and other infrastructure and extraction
projects. The government’s ‘Responsible Resource Development’ strategy
aims to overcome opposition and promote a sector that in 2012 employed
more than 750,000 people. It would ‘tap into the tremendous appetite
for resources . . . we have in abundance’ and enhance already ‘high
environmental standards’ (Natural Resources Canada 2012).
Although Germany was a leader in transition to RES (Renewable Energy
Sources), its Fukushima-inspired Energiewende (Bundesministerium für
Wirtschaft 2010) ran into difficulties in expanding and accelerating that
agenda. One consequence was the sacking of the responsible minister. The
change to green/er energy is mainly borne by the state: as pioneer investor,
infrastructure provider, lender or underwriter, now when energy and envi-
ronment are overwhelmed by concerns about how much Germany will
have to pay to bail out debt-ridden Eurozone states. Turkey, meanwhile,
has become sceptical about the value of joining the EU. This ambitious
nation-state is unlikely to compromise its economic and technologi-
cal progress in order to fulfil others’ environmental preferences and the
modifications to energy use that might entail. Turkey impresses itself as an
‘energy hub’, which its political and business sectors perceive as providing
vast opportunities. It is politically easier to sell related benefits, including
lucrative, redistributable receipts, than a RES agenda. Turkey’s historic
rival, Greece, is even more desperate for hydrocarbon-transit rents (Wood
and Grant 2010).
3.2 Nuclear Power
The Euratom treaty of 1957 foresaw an EEC-wide nuclear energy industry.

Two decades later, anti-nuclear protest reached its zenith, prominently in
what are now EU states. Green movements gradually realised, however,
that viable energy options were not as absolute as they preferred. Multiple
problems – scientific-technical, financial, political – associated with imple-
menting a sustainable energy future influenced a turn to compromise.
Some activists conceded that nuclear power was a lesser evil than the
maintenance or expansion of electricity that emitted large amounts of
CO2. In 2011, 30 states, including disputed Taiwan, had nuclear industries.

All who lived in them relied upon it, directly or indirectly, and it had
gained support as a partial solution.
The March 2011 earthquake and tsunami, and ensuing calamity at the
Fukushima plant, reversed that sentiment. The reaction in Germany, 9000
kilometres away, was pandemonium, marches, and a government procla-
mation to close all atomic energy plants within a decade. An anti-nuclear
undercurrent and the political class’s capacity for opportunism were rein-
vigorated. Popular and party attitudes may change again, as energy-related
developments intensify and others emerge, along with unimagined ‘events’
that overwhelm extant circumstances and possibilities. In Japan, opera-
tions at some nuclear plants were restarted. Protests regularly occur and
nuclear power will be a ‘wild card’ in the next elections (Frankfurter
Allgemeine Zeitung 2012b; Sieg and Yoshikawa 2012). Taiwan also has a
precarious energy situation, exacerbated by non-recognition as a sovereign
state, being claimed by the PRC and competing with that powerful rival
for partners and resources. Controversy has accompanied the building of
a fourth nuclear plant. A sectoral manager claimed few people opposed
nuclear power, which generated about 20 per cent of Taiwan’s electricity,
but that the ‘noise of these few is very loud’ (Wood 2012). Fukushima
provoked another burst of protest and the nuclear issue was central in the
2012 presidential and legislative elections. The pro-nuclear incumbents
were re-elected (Engbarth 2012; De Changy 2012).
Even if no more nuclear energy was generated, the disposal of radioac-
tive waste is an unavoidable question, with transnational implications.
Nearly 40 years ago, one scientist claimed that the ‘problem would
no longer be millions of years, but would be reduced to the order of a
century’. Single countries are unlikely to solve it alone, however: ‘prob-
lems raised by the relationship between nuclear energy and democracy
in Switzerland are going to be, more and more, problems connected with
security and international solidarity’ (Zangger 1974).
3.3 Money
Nuclear plants require high expenditure for construction, waste disposal

and decommissioning. Per watt energy is comparatively cheap, more so if
charges on carbon emissions are imposed across entire sectors. Nuclear is
an option. Whether it is one that EU states can do without, while moving
towards a clean energy future, is unanswered. The macro-economic costs
of higher energy prices resulting from environmental regulation were
estimated by one pre-financial crisis and pre-Fukushima study to be
‘fairly limited . . . usually below 1% of GDP. Eco-taxes even engender
macroeconomic gains by way of double-dividend effects. The results

for Germany are fully in line with the results for the EU as a whole’
(Dannenberg et al. 2008: 1319). Another study (Technische Universität
Berlin 2011: 19–25, 60–61) calculated the direct and indirect costs of
Germany’s Energiewende from 2010 to 2030 at €335 billion. A systemic
shift to RES was difficult but manageable before the current crisis.
Germany is more than ever relied on to keep the EU afloat. Research and
development, infrastructure and implementation are expensive. Money
is in shorter supply. As the world’s premier promoter of democratisation
and green energy, the EU sets higher expectations of and for itself than
apply to other political entities. Concurrently, it is among those most
dependent on external sources and least able to mobilise the political
will to fulfil its rhetorical declarations. Contradictory processes occur.
Biofuels, for example, are not as straightforward or equitable as some
proponents believe (Williams and Kerr 2011; De Santi et al. 2008).
The Japanese government introduced a feed-in tariff scheme to
promote RES and partly compensate for a fall in capacity after opera-
tions were halted at many nuclear plants (Ministry of Economy, Trade
and Industry 2012). In France, the magnitude of a shift from nuclear
power to more RES would be greater than for other countries. About
78 per cent of France’s electricity is generated by its 58 nuclear reactors,
which have contributed to a relatively low level of CO2 emissions. The
state is the principal owner of this infrastructure and France is a big elec-
tricity exporter. The nuclear energy and defence sectors have close links.
This makes for intriguing politics. In Australia, an array of government
investments, incentives and disincentives are foreseen as stimulating a
‘Clean Energy Future’. It involves a conservative increase from a 5 per
cent RES share of total primary energy in 2009 to 9 per cent in 2034. A
carbon price, or tax, of $A23 per tonne was set in July 2012 and projected
to become part of an internationalised, and then floating, ‘cap and trade’
ETS from 2015 (Syed and Penney 2011). Within a few weeks the internal
scheme, which included a floor price of $15, was scrapped in favour of a
two-stage linkage with the EU’s ETS, the first from 2015 and a second
from 2018 (ABC 2012). Further vagaries of domestic politics will deter-
mine if, when and which of these measures will be implemented, repealed
or altered.
The costs for richer societies to convert to RES are huge. But how will
developing countries pay? A UN study (2009) estimated the global RES
market at $1.6 trillion in 2007–8. It calculated that ‘additional investment’
of $100 billion p.a. for 15 years would be needed to reduce the cost of the
main technologies, solar and wind, to affordable levels. Two-thirds of
this ‘additional capacity would be deployed in developing countries’. It is
hydropower that actually dominates the sector, because it is the cheapest

per watt form. The sun is free but solar energy is expensive. $257 billion
was invested in all RES in 2011, indicating that a global shift is possible if
private enterprise envisages profits. To date this has required large state
subsidies and other incentives, provided or guaranteed by taxpayers. This
means more debt. If citizens and governments are prepared to accept
that, including through funding of projects in China, India and Africa,
RES industries will expand. Associated dumping and trade disputes will
increase. If public subsidies end, the interest in RES start-ups will decline.
Meanwhile, over 80 per cent of primary energy is still generated by fossil
fuels, industries with substantial capital stock, investment and employees.
4 CONCLUSION
Easton (1965) distinguished between support for an incumbent leader-

ship and support for the liberal democratic system. The system enables
popular dissatisfaction with parties, leaders and policies to translate into
their removal. What many voters see as an ethically superior and requisite
option is regularly countered by an alternative view for which the support
of one constituency or one parliamentarian more has been assembled.
Polarisation in electorates induces radicalisation of policies as parties try
to gain by moving away from the centre, or by moving the centre itself (cf.
Downs 1957; Münckler 2012). This trend is apparent in the US, Australia
and some European states. Energy policy is one field with potential for
a more adversarial form of politics. In a recent US poll, 14 per cent of
respondents thought that the country was ‘headed in the right direction on
energy’. 84 per cent were worried about dependence on foreign oil and 76
per cent about a lack of progress in energy efficiency and RES; 37 per cent
ranked economic growth more important than ‘preventing harm to the
environment’, which was prioritised by 33 per cent. Energy prices were the
‘most compelling issue’ and 71 per cent were dissatisfied with the contribu-
tion of Congress to ‘tackling energy issues’ (Koch 2011).
‘Linearization’ is commonly understood as continuity without unpre-
dictable change. Hubbard (1969: 238), with whom the term is associated,
observed that ‘the period of rapid population and industrial growth that
has prevailed during the last few centuries, instead of being the normal
order of things and capable of continuance into the indefinite future, is
actually one of the most abnormal phases of human history’. That period
introduced powerful economic, social and technological dynamics in
national and international contexts, and made energy political. Economic
growth became regarded as indispensable: because it increases wealth or
because it contributes to creating and sustaining employment. This con-

dition matured into a dilemma. Even when energy is readily available,

growth is not guaranteed. For contemporary economies, energy shortages,
or unaffordable expense, would ultimately mean a growthless society.
The future will not just be a continuation of the past. The relative decline
of the ‘West’, and for much of it a deep economic-financial malaise, coin-
cide with pressure in its electorates for conversion from fossil fuels. Many
voters also demand phase-outs of nuclear power. Others oppose both of
these choices. It cannot be expected, however, that the ‘non-West’ will lead
a transformation in consumption patterns. An end to authoritarianism,
which is not on the horizon, does not mean support for a green agenda. It
is not guaranteed that newly emancipated electorates would demand what
environmental lobbies in established liberal democracies call for. Neither
would the emergence of a ‘global demos’ necessarily result in universal
green attitudes and policy. National and global energy challenges have
multiple tangents. Trade-offs will always be required. Political machina-
tions in the international arena confront national self-understandings
or self-images. Some liberal democracies have reached a modus vivendi
with illiberal energy suppliers. A few have with illiberal customers.
Youngs (2010: 6) suggests that ‘European diplomats are entirely candid in
arguing that pressure on human rights and peace-building is and will be
foregone in order to get the maximum number of countries signed up to
internationally-agreed climate change commitments’. Some of them ‘even
argue that democratisation’:
. . . would make it harder for regimes to make the concessions necessary to
cut carbon emissions. The growing feeling that liberal democracy is irrelevant
to these kind of existential problems may herald a return to elitist visions of
technocratic experts running the international system. (Youngs 2010)
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3. Framing new threats: the internal
security of gas and electricity networks in
the European Union1
Peter Zeniewski, Carlo Brancucci
Martínez-Anido and Ivan L.G. Pearson
1 INTRODUCTION
Most studies investigating the concept of energy security begin by drawing

attention to the different interpretations thereof (Chester 2010; Winzer
2012). The large number of conceptual approaches arise from differences
between academic disciplines (economics, engineering, political science),
historical contexts (the prevailing market and political conditions at
the time), levels of development (advanced/developing/underdeveloped
countries), timeframes (short-term/medium-/long-term outlooks), market
dimensions (demand or supply, liberalised or regulated), value chain
(upstream/transport/downstream/end use), levels of analysis (individual,
sectoral, national, regional, or global) and the primary or transformed fuel
in question (oil, coal, gas, nuclear and renewables on the one hand and
electricity, heat or refined products on the other).
The variable interaction of these factors lends an inordinate level of
complexity to the issue of energy security, which is further compounded
by the varying perceptions by different actors depending on their role and
position in the energy supply chain. Indeed, for an energy-exporting firm,
security is predominantly about maintaining the ability to serve foreign
markets and to keep up a sufficient level of demand and revenue from
energy production. For net energy-importing states, security is often a
political question of ensuring adequate, reliable and diversified sources
of supply; but even within these categories a great deal of variation exists
depending on the institutional structure and politics of a given state,
societal or market actor. Moreover, there is also differentiation at the
transnational and sub-state level; for example, multinational energy firms
may view security mainly in terms of a hospitable investment climate in
the territories in which they operate, whereas household and industrial
consumers assess security in terms of the price and efficiency of energy.
The way in which these factors shape the definition of energy security is
40

Internal security of gas and electricity networks in the EU 41
not simply a semantic squabble – one’s criteria in defining energy security

often informs policy outlook. For example, market-based analyses that
restrict the essence of energy security to quantifiable phenomena such as
physical availability and price tend to posit minimal government interven-
tion as a desired state for energy markets (Noël 2009). Studies that incor-
porate wider qualitative conditions such as affordability, sustainability
or the impact of a loss of supply on social welfare tend to favour greater
regulatory oversight of energy markets (Chester 2010). On a practical
level, the definition of energy security and its scope conditions will cru-
cially affect how both policy-makers and academics identify, order and
manage risks and vulnerabilities affecting the energy system, in whatever
form it is analysed.
Thus, in order to meaningfully contribute to the issue of energy secu-
rity, a great deal of domain-setting and analytical precision is required.
This chapter deals with the internal security of the European Union’s gas
and electricity grids, laying particular emphasis on future challenges to
network stability arising from the liberalisation of the internal market for
natural gas, the integration of renewable energy sources in the electric-
ity network and the cyber-security challenges to interconnected energy
infrastructures.
2 CHALLENGES ARISING FROM LIBERALISED

GAS MARKETS
The transport of natural gas – particularly across borders – is one of the

most commonly analysed phenomena by political scientists when they
address the issue of energy security (Hoogeveen and Perlot 2005; Heinrich
2007; Orbán 2008; Pascual and Elkind 2010: Le Coq and Paltseva 2011;
Ratner et al. 2012). It is here that geopolitics is a salient parameter; this is
particularly true for the European Union, which depends to a large extent
on an extensive network of high-volume transmission pipelines carrying
gas imported from Russia, Norway and Algeria. That the placement of
and flow from these pipelines carries much geopolitical significance is par-
ticularly apparent for countries of Central and Eastern Europe as well as
the former Soviet Union, for reasons which have been discussed elsewhere
in this book. For present purposes it suffices to note that most studies
investigating the security of natural gas supply focus predominately on the
external context, such as the risks of relying on Russian gas or Ukrainian
transit pipelines (Hadfield 2008; Luft and Korin 2009; Mott MacDonald
Consultants 2010).
However, there is an internal side to the EU’s security of gas supply

which is rarely acknowledged in political science literature. In fact, many

such analyses effectively halt their discussion of supply risks and vulner-
abilities at the EU’s borders, assuming that gas produced and transmitted
inside the Union is free of the political and commercial risks prevalent in
the external sphere (Finon and Locatelli 2008; Bahgat 2011; Le Coq and
Paltseva 2011). Yet venturing inwards prompts consideration of a differ-
ent kind of security, one based less on geopolitically-motivated cuts to
supply and more on the challenges arising from gas market liberalisation.
Here, security of supply considerations are present in the wider push to
build an internal market for gas, manifesting themselves through issues
such as third party access and capacity allocation, spot market trading
and price volatility. These issues, in fact, warrant close attention in terms
of their impact on security of gas supply (understood in this case as the
ability of the gas system to satisfy energy services that are demanded over
a long-term investment horizon). But doing so requires an awareness of
the context in which these security of supply challenges arise.
The European Commission has been attempting to liberalise the
gas market for several years. The first meaningful Directive (98/30/
EC) was aimed at opening gas networks, which were dominated by
vertically-integrated monopolies, to competition from third parties. Further
structural measures to achieve full market opening were deemed necessary
under the Lisbon agenda, where the second gas directive (2003/55/EC)
strengthened provisions to ensure third party access and legal unbundling
of transmission system operators. However, because the impact of these
directives was not practically felt by customers (where little switching was
occurring) nor the wider European network (a continued lack of intercon-
nections precluded new supplies), the European Commission launched the
‘third package’ of energy legislation (European Commission 2007b). This
package constitutes a concerted push for liberalisation of both gas and
electricity networks on the basis of structural changes to both industries.
Greater authority has been vested in pan-European institutions such as
the Agency for the Cooperation of Energy Regulators (ACER) and the
European Network of Transmission System Operators, for both gas and
electricity (ENTSO-G; ENSTO-E). These bodies play important coor-
dinating roles and are responsible for promoting common rules and the
harmonisation of different national operating procedures. In this context,
EU-wide guidelines and network codes to facilitate cross-border gas trans-
actions have been developed by ACER and ENTSO-G, addressing issues
such as interoperability, capacity allocation, network balancing and con-
gestion management across borders. However, it is easy to lose sight of the
broader objectives behind restructuring the gas market; though not always
recognised by policy-makers in Brussels, market liberalisation is not an end

in itself. Rather, it should be viewed as the means to better quality services,

greater customer choice and lower end-user prices.
2.1 The Role of Security in Europe’s Liberal Gas Market
The EU’s energy policy rests on three ‘pillars’: competitiveness, sustain-

ability and security. Many reports have been devoted to unpacking
these concepts and explaining their relationship to one another (e.g. IEA
2008). Broadly, it appears that the guiding philosophy in Brussels is that
the market is the most effective tool for ensuring security of supply and
should therefore take precedence over state management of the gas sector
(whether in the form of active intervention during supply crises, state-led
investments in security projects or robust public service obligations relating
to strategic storage, back-up fuel capabilities, etc).2 This reasoning is based
on the idea that greater competition and third party access to infrastruc-
ture will increase the number of market players and facilitate cross-border
gas trade. An open, liberalised gas market, moreover, shifts the responsi-
bility for stable gas supplies from governments and state-owned monopoly
energy firms to a broader spectrum of actors – traders, shippers, network
operators and end-users. This lends a certain level of supply flexibility
via the wholesale gas market which is difficult to achieve in a model
dominated by a handful of vertically-integrated firms.
However, shared responsibility for security of supply also carries
with it several new challenges and risks. Indeed, the unbundling of
vertically-integrated energy firms means that no single entity is responsi-
ble for gas supply across the whole gas market; rather, each company is
responsible for its own customers and those customers that are eligible,
in turn, can opt to pay a premium for additional security (in the form of
firm contracts or ensuring their own means to substitute gas supplies).
But the main actors responsible for gas flows – traders, suppliers and
operators – principally respond to market signals when they consider
whether to invest in new infrastructure, redundant capacity or a diversi-
fied portfolio of suppliers. In most cases, these actors will not provide
extra investments for purposes of reliability if they are not compensated
by a competitive return on investment. Moreover, uncertainty is created
by the separation of gas supply and transportation activities, in that trans-
porters will not have complete information about future sources of supply.
Liberalisation will also challenge the traditional model whereby ver-
tically integrated, national gas monopolies secure supply by negotiat-
ing long-term, oil-indexed contracts (LTCs) with external suppliers.
Historically, the long-term nature of these contracts guaranteed a stable
source of supply over several decades and hence justified the heavy

investment costs of building long-distance gas pipelines. However, this

model is being challenged by the EU’s internal market reforms; the recent
‘Gas Target Model’ endorsed by the Madrid Forum (a high-level meeting
that brings together all European stakeholders in the gas sector) is effec-
tively a fundamental challenge to the bilateral relationships between buyers
of gas and their (external) producers. Indeed, the GTM puts forward the
expectation that all trading will be carried out on the spot-market, imply-
ing that once long-term contract gas sold by external suppliers enters the
theoretical single entry/exit zone of the EU, it can be traded from hub to
hub until it is delivered to a distributor or end-user. The problem with
this hub-based model is not only that major investments in transmission
infrastructures may be discouraged, but also that flows within the EU
become less predictable as they will respond to market signals rather than
pre-arranged deliveries of gas. This, in turn, will increase the complexity
of balancing procedures (ENTSO-G 2012). This is a contrast to an alter-
native approach more amenable to security of supply, in which base-load
gas demand is satisfied by LTCs while peak load periods will become the
responsibility of the internal spot market.
The changing nature of gas supply and transport is not the only area
where liberalisation can impact on security. There is also the challenge
stemming from price volatility. Spot-based trading on virtual and physical
gas ‘hubs’ (where buyers and sellers meet to determine the market price
based on supply and demand) increase the frequency and intensity of price
fluctuations. Whereas power generators and large industrial consumers
of gas can take advantage of this volatility by varying their demand with
the price level and using risk management instruments, small customers
such as households and small businesses do not benefit from volatility; for
these end-users the resulting uncertainty of the gas bill is not linked to the
physical but rather the traded market for gas. Thus, in a liberal market,
the demand profile has an important bearing on security of supply. For
customers with inelastic demand, that is, where their demand for serv-
ices provided by gas supplies does not change substantially due to price
movements,3 security of supply is a very important dimension. This is true
for households and essential social services. For customers with elastic
demand, for example industrial companies or power generators, where
consumption varies with the price of gas, security of supply is a consumer
choice.
With this in mind, there are two additional risks to security of supply
that manifest themselves in cases where a liberal market services a demand
profile that is predominately made up of gas-fired power plants (which are
increasingly built as combined-cycle gas turbines, or CCGTs). The first is a
price risk, whereby price volatility in natural gas markets is transmitted to

electricity prices; this is amplified by the use of gas as the marginal source
of fuel for ‘peak’ demand periods. The second risk is supply-related; dis-
ruptions to gas supplies threaten the reliability of electricity generation.
In a liberalised market, this threat is amplified by the lack of economic
incentives for CCGT operators to store alternative back-up fuels, given
the high costs involved in maintaining on-site lighter distillates that can
technically replace gas volumes (e.g. fuel oil). Although it has been argued
that volatility may provide the incentive to gas market players to invest
in system flexibility (e.g. storage or LNG terminals that enable one to
take advantage of price fluctuations), the question remains as to whether
volatile prices spur speculative behaviour instead of investment.
Finally, during a supply interruption the incentives to allocate gas are
fundamentally different between the two market models; a de-centralised,
trading-based market with little public service obligations may allocate
gas to the highest bidder, rather than conserve it for essential social
services and customers that are unable to switch fuels.
2.2 The Role of Network Development in Overcoming Security

Challenges in a Liberalised Gas Market
Despite the challenges noted above, it should be acknowledged that lib-

eralisation can also benefit security of supply in a number of important
ways. Indeed, a well-functioning liberal market will improve security of
supply by providing transparency and information to a wide range of
market players involved in the transmission, trade and sale of natural
gas. The benefits accrued from this model, among which are lower prices,
better services and greater accountability, would otherwise be lacking
under the traditional model of monopoly state-owned gas firms import-
ing gas through opaque and confidential long-term contracts. Moreover,
as gas import dependence continues to rise a larger number of players in
the downstream market may compensate for the increasing level of supply
concentration – and the associated risks and vulnerabilities – that many
Member States, particularly in import-dependent regions such as Central
and Eastern Europe, will have to contend with in the future.
However, no market design is perfect. Liberal gas markets will not by
themselves invest in additional flexibility to cope with high impact/low
probability events, such as extreme weather conditions (witnessed most
recently during the February 2012 cold snap) or external supply shocks
(e.g. the Russia/Ukraine gas crises in 2006 and 2009). Thus, the onus is
on regulators and governments to provide an institutional and regulatory
framework that facilitates security of supply objectives. Although the
instruments available are far-reaching, this section focuses in particular

on the importance of encouraging cross-border interconnections, where

the twin EU energy policy objectives of security of supply and liberalised
markets meet. After all, the greater the number of LNG terminals and
pipeline interconnections between markets, the less gas transport becomes
a captive market that is bound by the need to physically link producer A to
consumer B. These infrastructures also bring security of supply benefits by
diversifying sources and increasing the resilience of the network to supply
shocks from any one source.
The European Commission has recognised the need for infrastructure
investments to prop up the internal market and, taking into account
the principle of subsidiarity, has put forward a number of initiatives to
strengthen natural gas links between Member States. In October 2011,
the EC adopted the proposal for a Regulation on ‘Guidelines for trans-
European energy infrastructure’, with the objective of completing stra-
tegic energy networks and storage facilities by 2020. To this end, the EC
has identified 12 priority corridors, among which gas networks play a
prominent role, and has put forward a financing mechanism, the ‘Connect
Europe Facility’ to expedite projects of common interest that would other-
wise be considered too risky by the market. The CEF will be one of several
tools to fulfil the estimated investment target of €200 billion for energy
transmission networks by 2020, as forecast by the EC’s in-house system
model, PRIMES (European Commission 2011a).
For gas, the priority areas include North/South corridors for Western
Europe and Central/South-Eastern Europe, the Baltic Energy Market
Interconnection Plan (BEMIP) as well as the Southern Corridor. The
purpose of the two North/South corridors is two-fold. The first goal is to
better interconnect the Mediterranean area (supplied by sources in north-
ern Africa) with supplies from Norway and Russia. The second goal is to
diversify the energy supplies of Central and Eastern Europe by linking
sources from the Baltic, Adriatic, Aegean and Black Seas and to deliver
gas infrastructure projects that improve the interconnectivity of the region
in a North-South direction. Both of these goals will serve to increase
short-term gas delivery and enable the full use of possible existing infra-
structure, notably LNG terminals. The corridors will also remove internal
bottlenecks which currently prevent free gas flows in the regions, and
enhance the responsiveness of the system to potential supply disruptions.
Besides these broader initiatives, which are further explored and refined
in ENTSO-G’s ten-year network development plans as well as the Gas
Regional Investment Plans (GRIPS), the EU has also put in place some
important regulatory provisions to encourage member states to inter-
connect with one another’s gas infrastructures. For example, the latest
regulation on security of gas supply EC/994/2010 is an enabler for invest-

ing in cross-border gas infrastructure, obliging member states to enact

bi-directional capacities on all cross-border gas pipelines so that gas flows
are more flexible during supply crises.
Yet despite all the forceful rhetoric about achieving a competitive inter-
nal gas market, most EU legislation recognises the continued importance
of long-term bilateral contractual arrangements between non-EU gas pro-
ducers and EU buyers.4 Moreover, the emphasis on using public funding
to build large-scale infrastructure projects linking Member States consti-
tutes a tacit admission that the liberalised market may fall short of invest-
ing in sufficient capacity in the future. Thus, what appears as a broader
liberalisation push is actually an effort to build a hybrid gas market struc-
ture, one in which the ‘anti-competitive’ long-term gas supply contracts
sit alongside a liberalised, wholesale market for transmission and storage,
built around third party access and hub-based trading. This market design
is partly the product of attempts by policy-makers in Brussels to reconcile
the tension between two of the three pillars of European energy policy:
competitiveness and security.
All the while, the wholesale gas market will benefit from physical inter-
connections, driven by EU policy and sponsored by public funding, that it
would not otherwise have the incentive to create. In this sense, ironically,
the wholesale gas market becomes a free rider capitalising on the provi-
sion of public goods. This must be borne in mind when end-users assess
the benefits of liberalisation in terms of secure and affordable supplies of
natural gas.
3 NEW CHALLENGES TO THE SECURITY OF

ELECTRICITY SUPPLY
On February 2011 the European Council (EUCO) concluded that in
order to reach the EU objective of reducing greenhouse gas emissions by
80–95 per cent by 2050 compared to 1990 levels, a revolution in energy
systems is needed and it must start now (European Council 2011). In
order to reach such an ambitious goal, electricity will have to play a key
role. The European Commission (EC) called for a European power sector
which ‘can almost totally eliminate CO2 emissions by 2050’ (European
Commission 2011c). Several studies have concluded that full decarbonisa-
tion of the power sector is technically feasible but will require substantial
investments in renewable energy sources (RES), network development,
carbon capture and storage (CCS) deployment, energy storage and
increased energy efficiency (Haller et al. 2010; Delucchi and Jacobsen
2011; European Commission 2011b).

The European Council called for an Energy Policy for Europe with
three main pillars: security of supply, competitiveness and environmental
sustainability (European Council 2006). The changes and developments
which are expected to take place in the transition of the European energy
system will have an impact on security of supply. Accordingly, the EC’s
Energy Roadmap 2050 (European Commission 2011b) explores the chal-
lenges arising from the need to achieve the EU’s decarbonisation objective
while at the same time ensuring security of supply and competitiveness. It
states that the RES share rises significantly in all the scenarios considered,
achieving at least 55 per cent of gross final energy consumption (today’s
level is around 10 per cent). In other words, the EC concludes, that in
order to meet the desired objectives, RES will have to represent the biggest
share of energy supply technologies by 2050.
Such a large-scale integration of renewables in an electricity system
that is currently dominated by fossil fuels poses a number of challenges.
To address these challenges in an adequate institutional framework, the
European Commission’s Third Energy Package formalised co-operation
between Transmission System Operators (TSOs) by establishing the
European Network of Transmission System Operators for Electricity
(ENTSO-E). Its main objective is ‘to promote the reliable operation,
optimal management and sound technical evolution of the European
electricity transmission system in order to ensure security of supply and to
meet the needs of the Internal Energy Market’ (ENTSO-E 2010).
The objective of this section is to discuss the potential challenges that
an extensive RES deployment would bring to the electricity network in
terms of security of supply. In addition, the role and the need for elec-
tricity transmission development are discussed, especially in terms of
cross-border interconnections.
3.1 RES Challenges to Security of Supply
The EC defines security of electricity supply as the ‘ability of an electricity

system to supply customers with electricity’ (European Commission 2005).
However, the simplicity of this definition belies the complexity of electric-
ity generation and transport. Indeed, unlike primary fossil fuels such as
gas, oil and coal, electricity is a transformed form of energy that to a large
extent cannot be stored. Because of this unique attribute, most electricity
must be consumed whenever it is produced. This intrinsic characteristic
challenges the integration of renewables into the electricity generation
portfolio due to their variability and their partial predictability. Indeed,
intermittent RES produce electricity only when the wind is blowing or
when the sun is shining, thus not necessarily when it is needed. According

to most analyses, wind and solar electricity retain the greatest potential to
contribute and increase the shares of renewable electricity production in
the short to medium term. For this reason, whenever RES is mentioned
throughout this section, reference is particularly made to wind and solar
energy sources.
RES integration brings several challenges to electricity networks. First
of all, the structural characteristics of the electricity system must undergo
fundamental changes in order to accommodate the large-scale deployment
of RES. The traditional structure of the power system is evolving by intro-
ducing electricity generators at lower voltage levels and at more widely
distributed locations. In this evolution electricity consumers can become
producers as well (also known as ‘prosumers’), depending on their RES
electricity output at given moment in time. In addition, RES integration
affects generation adequacy and back-up needs. Traditional electricity
generation technologies are characterised by specific availability factors
which may depend on several aspects, such as maintenance time, over-
haul, reserves and potential unplanned interruptions. For RES, however,
availability factors depend on the wind and solar radiation resources in
the geographical location of the wind turbines or the photovoltaic (PV)
panels. The overall annual availability of RES is therefore much lower
than for traditional fossil-fired or nuclear power plants. In the case of
hydro energy sources, their availability depends on the characteristics of
the power plant, if it is driven by run of river, its power output is partly
controllable and it can be quite accurately predicted; in the case of storage
and/or pumping facilities, the power output can be fully controlled and its
management depends on seasonal hydro inflows.
Operators and electricity market players must address these challenges
by planning their investments, inter alia, around the expected deployment
of RES. ENTSO-E plays a supporting role to this end, publishing an
annual Scenario Outlook & Adequacy Forecast (SO&AF). This document
‘presents the scenarios included in the Ten-Year Network Development
Plan (TYNDP) in compliance with Regulation (EC) n. 714/2009 and
the assessment of the adequacy between generation and demand in the
ENTSO-E interconnected power system on mid- and long-term time
horizons’ (ENTSO-E 2010). The SO&AF 2012–2025 (ENTSO-E 2012a)
describes the generation adequacy assessment of the countries served
by ENTSO-E’s Transmission System Operator (TSO) members for the
period 2012–2025. In addition, the assessment is also presented for six
regions and for the whole ENTSO-E region. Figure 3.1 shows a schematic
of the generation adequacy assessment by ENSTO-E (ENTSO-E 2012a).
An important measure for the analysis of the generation adequacy for
a specified country or region is the estimation of the Reliable Available

System service
reserve
Outages
Overhauls
Unavailable
capacity
Non usable
capacity
Net
generating
capacity
Remaining
margin Spare capacity
Adequacy
Remaining Margin against reference
Reliable available capacity (seasonal) peak load margin
capacity
Load
Source: ENTSO-E 2012a.
Figure 3.1 Generation adequacy assessment from ENTSO-E SO-AF

2012–2030
Capacity (RAC), which is equal to Net Generating Capacity (NGC)

minus the Unavailable Capacity. The latter consists of Non Usable
Capacity, maintenance, overhauls, outages and system reserves. For the
scope of this discussion, we will only focus on the contribution of RES
to the Unavailable Capacity, more precisely to the way in which the Non
Usable Capacity is calculated for RES. The Unavailable Capacity is an
important tool for estimating the additional investments necessary for
ensuring security of supply, particularly in cases where a large amount of
electricity is generated by RES. However, ENTSO-E (ENTSO-E 2012a)
shows how European TSOs account for the unavailability or the Non
Usable Capacity of wind and solar energy sources in very different and
conflicting ways when assessing the generation adequacy of the countries
that they serve. Some TSOs consider that wind generation capacity must
be considered totally (100 per cent) or almost totally (94–96 per cent) as
Non Usable generation when assessing generation adequacy due to the
variable and uncertain characteristics of wind power generation. On the
other hand, other TSOs only consider the average unavailability factor
(70–75 per cent) of wind power generation.
The assessment of generation adequacy is of crucial importance when
evaluating the security of supply of a country or a region. In order to effi-
ciently plan the future of European electricity infrastructure, it is necessary
that common definitions are used by all stakeholders. As the Agency for

the Cooperation of Energy Regulators (ACER) stated, ‘it is important

that ENTSO-E promotes new methodological approaches to estimate reli-
able capacity of wind and solar power plants’ (ACER 2012).
The RAC of RES depends on the size of the region that is considered
and on the location and distribution of the wind turbines and the solar
panels. Several studies (Yi et al. 2009: Hoicka and Rowlands 2011; Widen
2011) have analysed the correlation and potential complementarity of
wind and solar energy sources. In some cases, these correlations increase
the RES contribution in the RAC estimates. As mentioned above, it is
important to analyse carefully and understand the definition of Reliable
Available Capacity and its implications in terms of generation adequacy
and security of supply, which in turn have an impact on the needs for
electricity transmission investments.
A recent study (Grave et al. 2012) defines the concept of ‘secure
capacity’, which results from a combination of several probabilistic dis-
tributions on the availability of each type of generation capacity. The
increase in the secured capacity of the whole generation fleet provided
by wind or solar energy generation is defined as their ‘capacity credit’.
The study focuses on Germany and assumes that the secured capacity
for solar energy generation is 0 per cent, since the annual peak demand
happens during hours of relative darkness (between 6 and 7 p.m. on a
winter evening). However, this result will probably not be applicable to
Southern European countries which observe annual peak load demand in
the middle of a summer day due to the high air conditioning demand. In
this case the ‘secure capacity’ of solar energy generation would be higher
and significant in the case of a high PV penetration. The study (Grave
et al. 2012) calculates that the capacity credit for wind lies between 5.2
per cent and 6.2 per cent of total installed wind generation capacity. The
capacity credit is dependent on the distances between wind parks. When
the latter increase, the correlation between the wind resources decreases
and therefore the distribution function of wind energy generation flattens
and the capacity credit grows.
The calculation of the capacity credit for wind or solar energy gen-
erators in a region or a country is based on meteorological statistical
databases. The longer the period under analysis, the more accurate the
capacity credit values. Intuitively, and due to the previously mentioned
geographical correlation of natural wind resources, considering an inter-
connected larger area provides a higher RES capacity credit, which means
that secured capacity needs from other energy sources (such as gas-fired
power plants) will be lower.
The challenges that RES pose to security of supply, mainly in terms
of ‘secure capacity’, can be balanced by other technological means such

as electricity storage and the development of electricity transmission

networks.
3.2 Impact of Network Development on RES Integration and on Security

of Supply
Electricity transmission is an enabling technology that can be used to alle-

viate, to a certain extent, the challenges that variable RES pose to security
of electricity supply in Europe. Several studies state that electricity trans-
mission development, including cross-border interconnections, is essen-
tial in order to cope with the variability of RES and to reach the almost
total decarbonisation of the European power system by 2050 (European
Commission 2011b; Jaureguy-Naudin 2012). For instance, ENTSO-E’s
latest TYNDP (ENTSO-E 2012b) claims that 80 per cent of the planned
electricity transmission projects for the next decade will bring high benefits
for the expected RES integration; half will directly connect RES and the
other half will accommodate inter-area imbalances triggered by RES.
Development of the European electricity transmission network in order
to manage variations from a high penetration of wind and solar electricity
generation reduces, partially, the need for energy storage and back-up
generation capacity (European Commission 2011b). These three tech-
nologies of the electricity system can be seen, in some measure, as comple-
mentary. This does not mean that any of them can fully substitute one of
the other two. Some of their characteristics and their contributions to the
functioning of the electricity system are similar. Nonetheless, the present
and especially the future European electricity transmission network will
not be able to pursue the three pillars of EU energy policy without any
of these technologies. They are all necessary. However, the fundamental
question is: to what extent and with which proportion does the European
electricity system need transmission capacity development, storage and
back-up generation capacity?
In order to answer this question and to adequately plan the future
European electricity system, several aspects must be considered. First of
all, investment costs for each of these technologies must be taken into
account. Another very important and urgent concern is the design of the
markets in which each of these technologies will play a role. The rules
established by these markets will foster investments towards a certain
direction and they will shape the future electricity system. For instance,
who will invest in cross-border transmission capacity? And who will
benefit from it? Another crucial question is, how can back-up generation
capacity be incentivised? With an increasingly large RES share in the
electricity generation mix, back-up capacity requirements (mainly gas-

Security of supply
21,900 km
Renewable
energy sources Internal
integration energy market
45,300 km 18,200 km
Source: ENTSO-E 2012b.
Figure 3.2 Projects of pan-European significance: volume breakdown per

EU energy policy pillar
driven) will increase, but their load factor will significantly decrease. How
do we ensure that market players sufficiently invest in these technologies?
An additional interesting question addresses the role of storage: how will
investments in storage be remunerated? And more than this: who will
manage/operate the storage devices? Are the generation sources to be
owned by private or balancing tools to be used by the system operators?
European electricity transmission development plays an important
role in the European Union’s ‘sustainability’ pillar. Indeed, the other two
pillars – security and competitiveness – definitely benefit from additional
transmission capacity (both national and across borders). The projects
identified by ENTSO-E for the development of the European electric-
ity network in the next decade amount to a total of 52300 km of either
upgraded or new assets. Figure 3.2 shows the volume breakdown per
EU energy policy pillar of the projects with pan-European significance
(ENTSO-E 2012b).
ENTSO-E’s latest TYNDP (ENTSO-E 2012b) has identified 100 poten-
tial bottlenecks in the European network by the end of the decade. Half
of them are directly related to market integration; transmission develop-
ment would facilitate grid access to all market participants and it would
contribute to social welfare by internal market integration and harmoni-
sation. 20 per cent of the identified bottlenecks directly relate to security
of supply issues. Investments in transmission development would ensure
safe operation of the electricity network providing a high level of security
of supply.

ENTSO-E’s TYNDP (ENTSO-E 2012b) has identified over 100 projects

to solve the previously mentioned bottlenecks over the next decade: ‘33%
of these projects are required to integrate isolated systems such as the
Baltic States, secure large load centres (in particular capital cities), or even
countries with negative generation adequacy forecast in the coming years
(ex: Belgium)’. In addition, the challenges that variable RES bring to secu-
rity of supply would also be alleviated by the development of the electricity
transmission network.
3.3 Challenges to European Electricity Network Development
The extension of a power network is not only hindered by technical barri-

ers. Most of the limitations are political, economic and physical. First of
all, it is important to mention that ‘the time required to get the authorisa-
tions to build new transmission assets is generally much longer than the
time needed to build new power plants’ (REALISEGRID 2009). The
coordination of both types of investments are challenged by the long reali-
sation periods and by the different lifetimes of generation and network
infrastructures.
Another important challenge that electricity transmission development
must face is the uncertainty about future investments in electricity genera-
tion. For example the EC estimated that in order to reach a decarbonised
European power sector, the ‘cumulative grid investment costs alone could
be 1.5 to 2.2 trillion Euros between 2011 and 2050’. The higher value
corresponds to a greater investment in RES. The wide range of expected
investment costs shows the uncertainty level in terms of future electricity
generation investments in Europe.
EU Member States (MS) are solely responsible for their national energy
mix. The 27 EU MS together with the other European interconnected
countries have their own strategies for shaping the future national electric-
ity networks. In order to fully achieve the three EU energy policy goals,
a more European vision must overrule the current national strategies.
As Jaureguy-Naudin (2012) argues, EU MS should discuss and agree on
a common EU electricity generation mix. In such a way, variable RES
would be located where the natural resources are more favourable, a more
optimised electricity network could be planned, and clearer signals for
investments would arise.
Building a sustainable European electricity network is not without
its challenges. This section highlighted some of the tensions apparent in
simultaneously achieving a sustainable and secure electricity grid, par-
ticularly in the context of the integration of renewable sources of energy.
However, it has been demonstrated that the development of the electricity

transmission network will not only increase its resilience but also enhance
its ability to accommodate large-scale deployment of RES, while at the
same time facilitating the creation of a competitive market. In this way,
future investments in electricity transmission infrastructure will satisfy all
three pillars of the EU’s energy policy goals, including security of electric-
ity supply. The essential preconditions for reaching the aforementioned
goals should be the synchronisation and harmonisation of the European
countries’ management and strategies for defining energy security as well
as market designs that would incentivise investments in RES and network
development.
4 CYBER SECURITY AND OUR INCREASINGLY

INTERCONNECTED ENERGY
INFRASTRUCTURES
Thus far, this chapter has focused on the physical system in place to trans-
mit two different forms of energy: natural gas and electricity. However,
the smooth operation of this ‘hardware’ needs to be underpinned by
reliable ‘software’ that can securely manage the flows and information
characterising this system. Thus, we now turn our attention to the threats
arising in a different setting, namely cyberspace.
Since 2007, several serious cyber attacks on EU Member States have
come to light (Myrli 2009). The most notable attack was that experienced
by Estonia in April and May 2007. Because Estonia had embraced ICT
as driver for economic growth during the 1990s, the societal impact of the
three-week-long series of cyber attacks was substantial (Estonian Ministry
of Defense 2008). Although authorities across the globe had recognised
the theoretical threat posed by cyber attacks for over a decade, the scale
and politically-motivated nature of the attacks on Estonia significantly
raised the profile of the problem. The Estonia attacks also spurred an
analytic shift. Whereas cyber security was previously examined predomi-
nantly through a law-enforcement lens, the pressing international security
implications of cyber attacks had now been highlighted.
The year 2010 marks a dubious milestone being the first year that
Chatham House devoted a significant section of its annually compiled
Military Balance to cyber warfare – chief among a list of asymmetric tech-
niques the think-tank believes are changing the face of modern conflict
(International Institute of Strategic Studies 2010). This move is joined
by major reports by the Center for Strategic and International Studies
in Washington DC (CSIS Commission on Cybersecurity for the 44th
Presidency 2008) and the United Kingdom’s House of Lords (EU Home

Affairs Sub-Committee 2010), as well as numerous notable pieces on cyber

security in leading European and international journals (Ruus 2008; Clark
and Levin 2009; Geers 2009; Hughes 2010).
The debate indicates a consensus that potentially all digital systems are
vulnerable, whether via their networked interconnections or engineered
hardware defects. Networks are especially vulnerable because they consist
of a vast number of interdependent devices and components, a great
proportion of which may use off-the-shelf hardware or software that has
been brought to market as quickly as possible. Because this commercially
available product also tends to be the most affordable, economic con-
siderations mean that it becomes widespread. Cyber attackers therefore
often only need to discover just a single vulnerability in order to bring
disruption at a systemic level. The end result is the current ‘patch and
pray’ computer security paradigm – a defensive posture whereby potential
exploits in deployed systems are continuously sought and fixed in light of
the pervasive vulnerability of networks.
Most disturbingly of all, the discourse clearly suggests that our net-
works will increasingly become the battleground for conflicts involving
both state and non-state actors such as terrorist organisations and crimi-
nal groups – a trend that policy-makers in all fields of government cannot
afford to ignore. With specific regards to the energy sector, the effects of
cyber attacks have the potential to affect a greater number of stakehold-
ers than ever before because both our gas and electricity networks are
becoming increasingly interconnected.
4.1 Cyber Attacks on Gas Transmission SCADA Systems
Especially of interest for existing energy infrastructures are attacks on

Supervisory Control and Data Acquisition (SCADA) systems – real-time
industrial control systems that are used to monitor and control dispersed
physical assets or field devices (such as switches, valves, pumps, relays,
etc.) from a central location while collecting and logging field data.
SCADA systems are widely deployed in national infrastructures such as
electricity, telecommunications, water and waste control, as well as oil and
gas refining and transportation.
Generically, a SCADA system consists of central and remote site hard-
ware, applications software and communications services. These systems
encompass the transfer of data between a SCADA central host computer
and a number of Remote Terminal Units (RTUs) and/or Programmable
Logic Controllers (PLCs), and the central host and the operator terminals
(National Communication System 2004). A SCADA control centre typi-
cally has advanced computation and communication facilities. Modern

control centres have data servers, Human-Machine Interface (HMI) sta-

tions and other servers to aid the operators in the overall management
of the utility’s processes. The control centre is usually connected to the
outside corporate network and/or the Internet through specialised gate-
ways (Igure et al. 2006).
SCADA plays an essential role in natural gas transmission, allowing
operators to analyse pipeline conditions and make timely responses to
operational problems. Industry surveys reveal that 85 per cent or more of
the world’s operating oil and gas pipelines of more than 25 kilometres are
controlled by a computer-based SCADA system (Treat and Bartle 2009).
Pipeline systems are almost always remotely managed from control
centres where key variables, such as moisture, quantity, pressure and
temperature are monitored and mechanical components, such as switches,
valves, compressors, odorising stations, and pumps are operated via the
SCADA system. Essentially, SCADA systems in the gas transmission
system also monitor pipelines for total volumetric flow rate in order to
provide yield data (Ryu et al. 2009). SCADA systems used for supervising
pipeline transportation almost always have full (or as near as is possible)
redundancy. For very critical pipelines there might even be a back-up
operating site with another complete SCADA system sitting ready.
Essential leak detection systems are usually incorporated into the SCADA
system, using RTUs and PLCs for collecting field data and automatically
executing certain necessary commands (Williams 2003; Shaw 2009).
Because of their sensitive and important nature, SCADA systems pose
a target to groups and individuals seeking to attack national infrastruc-
tures. For example, computers seized from al-Qaida show details about
a range of SCADA systems in the United States (Aylon 2009). An attack
on the SCADA systems of Europe’s gas transmission network could also
have the added effect of crippling downstream facilities. For instance, a
cyber attack on compressor stations that fuel natural gas power plants
could result in blackouts that would affect many EU Member States in
the increasingly interconnected European electricity system. In such a
case, a cyber attack on a pipeline’s SCADA system would probably not
be intended to harm the SCADA system itself, but rather use the SCADA
system to trigger actions harmful to the pipeline and associated facili-
ties. It would be possible for an attacker to send forged messages into the
SCADA system, causing the operating room to see what the attacker
wants it to see (open valves looking closed, running pumps apparently
stopped, pressure and flow measurements apparently stable, etc.). Less
sophisticated attacks could aim to overload communication networks by
means of a so-called ‘data storm’ in which too much data in the control
network blocks its ability to monitor and control the physical process

(Averill and Luiijf 2010). This would blind operators to a dangerous situ-
ation for a moderate period of time, or deprive them of communications
with field equipment. Many nodes on SCADA networks are embedded
computing devices that run real-time operating systems (RTOS) and other
real-time control software, making them especially susceptible to even
minor disruptions of this sort.
It’s important to differentiate here between a loss of control and a
deliberate attempt to infiltrate and take over the system. When control is
lost, as above, the system will generally fail safe, whereas if the system is
hijacked, the consequences are potentially far graver (Munro 2008).
The end-effect of such attacks could be physical damage to a pipeline,
release, pressure drop, product loss, environmental contamination, explo-
sions, fire, death, injury or other serious consequences. The degree of
damage attacks of this nature could generate depends on the intelligence
level of the RTU (how much local, semi-autonomous regulatory control
and sequence-safety logic it performs), the types of equipment it directly
operates (valves, pumps, motors, etc.), and the presence (or lack) of
hard-wired safety logic that would override the RTU’s dangerous actions
(Shaw 2009).
If such attacks are detected, completely reformatting hard drives and
reloading the affected computers (and other infected network compo-
nents) from ‘clean’ back-up media, usually puts things back as they were
before the attack. But this takes time (once it is actually realised an attack
is in progress) and requires thoroughly tested, well-documented and
well-rehearsed procedures for performing a system restoration. Because
the hardware and processes SCADA usually control are very time sensitive,
significant commercial losses can be expected in even minor cyber attacks.
The SCADA systems of the gas and oil sectors have already been the
target of successful cyber attacks. In the winter of 2002–3, attackers were
able to penetrate the SCADA system responsible for tanker-loading at
a marine terminal in eastern Venezuela. Once inside, the hackers erased
the programs in the system’s PLCs that operated the facility, preventing
tanker loading for eight hours (Byres 2009). In a recently published book,
a senior US national security official reported how the USSR was allowed
to steal compromised pipeline control software from a Canadian company
including malicious code that caused a major explosion of the Trans-
Siberian gas pipeline in June 1982. The code ran during a pressure test on
the pipeline and massively increased the usual pressure, causing the explo-
sion (Reed 2005). This attack highlights the fact that any pipeline system
is susceptible to catastrophic failure as a result of loss of control over the
hardware measuring or managing pipeline pressure. The highly flammable
nature of natural gas exacerbates this problem.

Pipelines and related field sites are typically located in remote,

unmanned areas with relatively infrequent maintenance visits, making
physical sabotage comparatively uncomplicated. Cyber attacks would
therefore be more likely in situations where the attacker’s goals are more
substantial – for example, the systematic exploitation of vulnerabilities by
criminal or even terrorist organisations for financial or political gain. This
has led some analysts to suggest that control centres would be the target
of the most sophisticated attacks (Averill and Luiijf 2010). Alternatively,
motivated attackers may pursue cyber-attacks as a low-risk alternative to
physical attacks.
4.2 Cyber Attacks on the Electricity Grid
Notwithstanding the focus on natural gas, electricity networks also play

a pivotal, albeit understated, role in European energy security. A sizeable
37 per cent of Europe’s total primary energy consumption – regardless
of fuel source or origin – is destined for the generation of electricity.5
Given the grid’s essential role in delivering energy to the citizen, the
security-of-supply implications of this statistic are clear: weaknesses in the
electricity network have the potential to circumvent the benefits of a diver-
sified, affordable and readily accessible primary energy mix. Moreover,
reliance on electricity will almost certainly continue to grow as Europe’s
society and its economy become increasingly digitised.
Major blackouts in Italy in 2003, and across Europe in 2006, demon-
strated the devastating societal effects a cascading failure of the increas-
ingly interconnected electricity grid can have. During these blackouts,
millions of households were deprived of electricity, high-speed trains were
halted, members of the public were trapped in lifts and international air-
ports were forced to switch to emergency generation. The blackouts also
demonstrated the high level of transnational interdependency that exists in
the European electricity transmission system. For example, although the
2006 blackout originated in Germany, it affected an estimated 5 million
households in France, as well as 10 million households across Belgium,
Germany, Italy, Portugal, Spain and Eastern Europe. Austria, Croatia
and the Netherlands were also reportedly affected, and the disturbance
even reached as far as North Africa via the Spain-Morocco submarine
cable (Stefanini and Masera 2008; van der Vleuten and Lagendijk 2010a,
2010b).
In Europe, a number of factors are driving a revolution in electricity
transmission (between the power plant and substation) and distribution
(between the substation and the consumer). As mentioned in Section 3.2,
the electricity sector will become increasingly reliant on intermittent and

distributed wind and solar power. Upgrading ICT is necessary to increase

the overall efficiency of the grid, and to increase the grid’s reliability in this
new challenging context.
4.2.1 Growing ICT dependence in the European grid

Three fundamental physical realities already make the electricity grid
more dependent on ICT than any other energy infrastructure. First,
electricity flows at close to the speed of light, demanding high-speed
decision-making and response times for its management. Secondly, it must
be used or stored the instant it is produced or else it goes to waste, making
maximising efficiency a constant challenge. Thirdly, the flow of alter-
nating current electricity through the grid cannot be straightforwardly
controlled by opening or closing a valve in a pipe, or switched like a call
on a telephone network. Electricity flows freely along all available paths
from the generator to the load in accordance with the laws of physics, and
although this flow can be manipulated to a degree using devices such as
phase shifting transformers, accurately determining flow along the grid’s
complex architecture is a complex task (US-Canada Power System Outage
Task Force 2004).
The net result is that ICT has become an integral part of the modern
electricity transmission system, gathering network information and auto-
matically issuing control actions in near real-time to keep the grid stable
as demand and generation fluctuates. The interdependence between the
electricity and communication infrastructures is now so profound that
some researchers even suggest that they need to be conceived of within
an ‘energy-and-information’, or E 1 I, paradigm: disturbances in the tel-
ecommunication infrastructure can cripple the electricity infrastructure as
much as is true visa versa (Gheorghe et al. 2006).
As we look to do more with less fossil fuel, this interdependence is only
set to grow. ICT will incentivise consumer energy efficiency by providing
real-time feedback on household energy consumption. Studies suggest
that direct feedback on electricity consumption, such as that provided by
smart meters, leads to domestic energy savings in the region of 5–15 per
cent (Darby 2006; Fischer 2008). The ‘smart’ grids of the future will be
more efficient, allowing operators to reduce system losses by more quickly
and accurately balancing loads, managing feeder voltages, and analysing
power flows. They will be significantly more robust thanks to their ability
to ‘island’, whereby self-sustaining portions of the grid isolate them-
selves from disrupted sections and help to ‘black start’ the system after a
widespread blackout (L’Abbate et al. 2007).
Decentralised management, diverse network routes and a variety
of interlinked utilities and operators have the potential to make the

European electricity system highly reliable and even self-healing

(European Commission 2006; United States Department of Energy 2008).
Most importantly, however, smart grids will mitigate the effects of climate
change and hydrocarbon import-dependence by enabling Europe to
incorporate more electricity from indigenous renewable sources that are
currently too widely distributed and intermittent for the feed-forward
networks in service (Ackermann et al. 2012). This is an especially urgent
consideration for Europe given the sharp rise of renewable generation
expected (International Energy Agency 2009) and reports that installed
wind and solar power is already testing the infrastructure of some Member
States (EurActiv with Reuters 2010).
4.2.2 Network reliability and security challenges in the transition to smart

grids
Whilst this shift towards ‘smart’, or at least ‘smarter’, distribution net-
works could play a key role in enabling Europe to address many of its
most pressing energy priorities, it is widely accepted that a number of chal-
lenges will need to be overcome.
The next generation of Europe’s electricity grids will face an even greater
variety of cyber vulnerabilities than those of the gas and electricity net-
works of today. The remainder of this section reviews developments in the
field of cyber security, analysing five of the most pressing challenges the
electricity network will face in coming years: 1) the large amount of sensi-
tive customer information the grid will transmit; 2) the greater number of
control devices in the smart grid; 3) the poor physical security of a great
proportion of these devices; 4) the move away from industry-specific
communication standards and hardware; and 5) the greater number of
stakeholders the grid will rely on for its smooth operation.
4.2.2.1 Customer security Perhaps the most widely-acknowledged chal-

lenge is that smart grids will create the theoretical possibility of a type
of attack hitherto unknown in the energy sector: cyber attacks through
the electricity network, as opposed to on the network itself. Smart grids
will transmit a larger amount of sensitive customer information than the
electricity network has at any time before. Additionally, smart metering
technology may eventually allow system operators to attenuate cus-
tomer demand in order to balance the grid during an incident (European
Commission 2007a). Given this enhanced functionality, security failures in
the grids of tomorrow may not only mean reduced overall grid reliability,
but also the possibility of the exposure of highly sensitive information on
household activity, and selective or coordinated blackouts. Put simply,
the system operators of tomorrow will be more closely charged with the

well-being of European citizens than ever before. This will require nothing
short of a paradigm shift in industry from the current hardware-centric
focus on system adequacy and reliability6 (Endrenyi and Welsow 2001)
towards the inclusion of a more directly consumer-oriented view of secu-
rity that addresses issues such as the integrity of data communicated: the
authentication of communications; the prevention of unauthorised modi-
fications to smart grid networks; the physical protection of smart grid
networks and devices; and the potential impact of their unauthorised use
on the bulk-power system.
4.2.2.2 A greater number of intelligent devices Smart Grids will be

reliant on an exponentially greater number of digital devices than today’s
grids – devices that will be decisively involved in managing both electricity
supply and demand in the network. Remote sensors dispersed throughout
the transmission system will increasingly help system operators identify
bottlenecks, and keep the grid operating reliably in spite of the greater
transnational electricity flows anticipated. The ‘active’ distribution net-
works of the near future will rely on intelligent substations to quantify
and manage the ever increasing amount of electricity put back into the
grid from distributed renewable generation. And smart meters will enable
greater consumer demand response than ever before.
In absolute terms, this proliferation of intelligent control devices may
not significantly increase the grid’s reliance on ICT when compared to
the present situation: as described earlier, the supply of electricity to
vast numbers of consumers is already acutely dependent on the reliable
operation of a relatively small number of centralised and well-protected
Supervisory Control and Data Acquisition (SCADA) systems. However,
if we accept that each node in the network also represents a theoretical
point of access, the transition to more intelligent grids will unavoidably
increase the grid’s permeability to those with malicious intent. Moreover,
bigger networks are harder to monitor and police – a stark fact given some
estimates that the smart electricity network of the future will be between
100 and 1,000 times larger than even the Internet (LaMonica 2009).
4.2.2.3 The problem of physical security Most experts agree that physi-
cal security – controlling the physical access to machines and network
attach points – is perhaps more critical than any other aspect of computer
network security. But building the smart grid not only entails increasing
the number of critical control devices, but also their diffusion to a greater
number of insecure physical locations than ever before. Because sensi-
tive SCADA systems are already housed in secured sites in the transmis-
sion system, most attention will be needed at the level of the distribution

network where the passive, radial architecture of the past will give way to a
new, meshed structural design that requires the introduction of a plethora
of intelligent control devices where once there were few.
Most pressing of all, systemic exposure to faults and malicious activity
originating from smart meters will need to be minimised in light of their
location within customers’ homes, where physical security will be impos-
sible to guarantee. This will have a profound impact on the way network
security for the smart grid must be conceived of as it will make the con-
ventional distinction between ‘safer’ internal networks (such as local area
networks) and ‘more dangerous’ external networks (such as the Internet) a
false crutch for security design. Even though there are no plans to connect
smart grids to the Internet, direct and indirect connectivity between
smart meters and every other node in the electricity network – including
power plants – will demand an extremely disciplined approach to internal
network security.
4.2.2.4 The use of internet protocol (IP) and commercial off-the-shelf

hardware and software The use of IP as a communication standard will
compound the problems of large network size and physical insecurity. IP
offers a practical advantage over other standards in that it facilitates inter-
operability between a broad range of components, and is flexible enough
to accommodate the evolution of the smart grid into as-yet-unforeseen
application areas. Depending on the data transmission medium, IP may
be more reliable because of its dynamic routing capabilities. And IP is
also more affordable to use, being both widespread and well-supported
by industry.
One significant drawback of IP is that it is a common network standard
with numerous, widely-known vulnerabilities. For example, messages to
be transmitted over an IP network are broken into manageable chunks
called packets, but attackers have learned to use a number of techniques to
mask the origin of a packet as it ‘hops’ from router to router along an IP
network’s potentially complex infrastructure, making attacks difficult to
trace (Lipson 2002).7 Hiding the source of messages is just one of many IP
vulnerabilities that malicious users have learned to exploit, and research-
ers have already cautioned against a recent industry trend to replace spe-
cialised software and communications systems with IP for reasons of cost
and convenience (Markulec 2008; Munro 2008).
Also of concern is the likelihood that the substantial costs associ-
ated with the size of the infrastructure upgrade will mean commercial
off-the-shelf hardware and software will become widespread in smart
grids. This would subject them to the same forces that have contributed
to the systemic insecurity of the Internet and corporate IT networks as

many smart grid components and applications will be manufactured and

distributed on a mass scale, making any vulnerabilities they carry also
exploitable on a mass scale. Additionally, smart grid components will be
built with the minimum computational capabilities thought necessary at
the time of their design to keep production costs low, possibly limiting the
security measures they can support in the future.
Because interoperability and affordability will be key challenges in the
transition to smart grids, it will be difficult to resist the broad use of IP and
commercial off-the-shelf hardware and software in the networks of the
future. However, their use also means that potential attackers will not need
to be SCADA experts, or have detailed information on industry-specific
hardware vulnerabilities, in order to launch an effective and widespread
attack on a smart grid. Techniques and vulnerabilities discoverable on the
Internet and commercial networks will be adaptable to smart grid attacks,
and such expertise will also become more widely known.
4.2.2.5 More stakeholders The liberalisation of the European electric-

ity market in recent years has led to the unbundling of the vertical public
monopolies that were once dominant. Electricity generation, the operation
of the grid and the provision of wholesale and retail electricity services to
customers are all now carried out by a greater number of increasingly sep-
arated stakeholders that continuously need to share data with each other
in a marketplace that looks set to become ever more diversified. While this
offers the customer the opportunity to benefit from new services and effi-
ciencies, networks are especially fragile to internal threats and negligence
(Cisco Systems 2007).8 Minimising the impact of the ‘human element’
will become even more difficult with the smart grid as the traditional
mechanisms co-ordinating grid reliability and security fade away, and
the number of utility companies, contractors and smart meters increases
(De Bruijne and van Eeten 2007; van der Vleuten and Lagendijk 2010a).
The heart of the problem is how to deal with reduced accountability – an
unwanted by-product of the new electricity market. As Marcelo Masera
writes:
The current decentralised nature of liberalised electricity infrastructure has as

a consequence that individual operators cannot be held responsible for the way
the system as a whole functions. . . . Nobody owns, designs, or operates the
infrastructure. The state of the infrastructure is the result of many independent
decisions taking by all the participant actors, at the technical level, but also at
the market level. (Masera 2010)
In particular, how can sufficient investment in security be incentivised

where many actors have a collective, but fuzzy, stake in grid reliability?

Meeting this challenge without undue bureaucratic burden will only

become more vexing as an increasing number of small scale generation
units – and even customers – become integral to supply in the market in
the coming years (de Vries et al. 2010).
5 CONCLUSION
Interconnections imply both solutions and challenges to security of

energy supply. This is particularly true for the European Union, where all
three pillars of the EU energy policy converge around a common goal of
cross-border infrastructure development. Although additional intercon-
nections are often seen as beneficial to security, the accompanying increase
in interdependence should be taken into account. Indeed, this chapter has
introduced some of the internal challenges and vulnerabilities facing the
European Union as it attempts to modernise and inter-connect some of
the most complex energy systems on the globe. That this task carries with
it a number of uncertainties is clear; special attention has been paid to the
problems for security of supply engendered by gas market liberalisation,
renewable energy deployment and the expansion of ICT systems control-
ling complex energy networks. These three issues, moreover, impact on
the external dimension of EU energy security in important ways. For
example, just as the liberalisation of the internal EU gas market will
challenge long-standing relationships with external suppliers, so too will
the problems arising from large-scale deployment of renewables require
external solutions, such as the import of electricity from solar panels in
the Sahara desert. Thus, the interdependencies between these external and
internal dimensions will crucially affect the EU’s overall energy security,
something that should be further explored in subsequent research.
NOTES
1. The views expressed are purely those of the authors, and may not in any circumstances
be regarded as stating an official position of the European Commission.
2. This market-based reasoning is reflected in the recent EC Regulation 994/2010, which
emphasises the use of market-based measures to deal with supply disruptions.
3. Bear in mind that demand can change for these customers due to other factors, such as
weather conditions.
4. Paragraph 42 of Directive 2009/73/EC.
5. Of the 1,806,336 thousand tonnes of oil equivalent (TOE) of energy consumed by the
EU27 countries in 2007, 683,744 were used to generate electricity (source: Eurostat
2012). All figures are for gross consumption, and the figure for transformation comprises
the combined input to conventional thermal power stations and nuclear power stations.

6. Adequacy and reliability can be respectively defined as ‘the ability of the system to
supply the aggregate electric power and energy requirements within current ratings and
voltage limits, taking into account planned and unplanned component outages’ and ‘the
ability of the system to respond to disturbances arising within that system’.
7. Source addresses may be forged, logs and other audit data may be destroyed and the so-
called IP tunnelling technology used in virtual private networks allows IP packets to be
encrypted and hidden within other IP packets.
8. A 2007 CSO Magazine/Cisco poll reveals that 59 per cent of chief security officers think
that employee error is the number one threat, while 37 per cent reported employee or
partner sabotage as the number one threat.
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4. Resource conflicts: energy worth fighting
for?
Joshua Olaniyi Alabi
INTRODUCTION
Because of its significant role in fuelling modern industrial economies

and military forces, oil has been the subject of domestic and international
politics and conflicts. The history of the international oil market and
energy security has been one of prolonged conflicting interests, where both
the major oil exporting and the industrialised consuming countries have
resorted to various strategies to ensure security of supply and of demand
or to influence prices, in such a way to meet individual interest. ‘From the
nineteenth-century battles over the Caspian Sea to the two Gulf Wars,
oil has been the prize in numerous military conflicts’ (Spero and Hart,
2003:229–30). In the same way the conflicts about offshore tracts in the
Gulf of Guinea between Nigeria and Cameroon at Bakassi Peninsula, and
between Nigeria and Equatorial Guinea at the Zafiro undersea oil field,
were on oil (Klare, 2001:230).
Conflicts over oil resources in many producing countries are gener-
ally at two levels: the first, at the macro level, involves international oil
companies (IOCs) and governments in the global North; the second is at
local level in the oil producing countries. I argue that the main aim is to
secure energy security by constant access to cheap oil and gas at reason-
able prices, through engaging in whatever means possible and necessarily,
including military interventions. An example is the USA-led gulf wars in
Iraq in 1991 and 2003. This macro level also includes conflict of interest
between national governments of oil producing states and international oil
companies over fiscal regimes, corrupt practices, environmental degrada-
tion etc. The second analysis of oil conflicts takes place at the micro level
within the national boundaries of oil producing countries, where conflicts
emerge on how to share the huge revenues from oil between the national
governments and sub national governments and other various stakehold-
ers. The various dimensions of these crises will be critically examined to
determine why conflicts emerge over energy resources, and why the eco-
nomic benefits from both the buying and selling of oil and gas are worth
fighting for.
70

Resource conflicts: energy worth fighting for? 71
This chapter will specifically focus on resource conflicts as they relate to

energy security and conflicts generated by oil and gas resources. In doing
this I will look at the historical overview of global oil conflicts issues from
the Caspian and Middle East in Kuwait and Iraq to Africa in the gulf of
Guinea Nigeria and Cameroon. I will analyse how resource conflicts are
changing through the role of institutions, piracy, private security com-
panies and the international oil companies (IOCs), using the traditional
realist approach to resource conflicts. The realist analysis of the politics
of international energy draws on the extent of state power to access and
control over energy resources, and it also argues that such resources are
becoming insecure and scarce and assumes that the contestation around
resource capture will continue (Dannreuther, 2010:2–3). This will be
explained in detail with the case of oil conflict in the Niger Delta, Nigeria.
AN OVERVIEW OF OIL GEOPOLITICS
The history of modern oil and gas industry began in the late 19th century
when the first major oil company, Standard Oil, was founded by John D.
Rockefeller in 1870 in the United States of America (Business Reference
Services, 2012). In the early 20th century the use of oil eventually replaced
coal as the world’s primary source of industrial power. During the same
century the oil industry also expanded rapidly at about 6.5 per cent;
from 1913 to 1948 and from 1948 to 1973 it was 7.5 per cent (Bromley,
2005:235 and Business Reference Services, 2012). The availability and
control of oil and gas played a foremost role in both the First and Second
World Wars and still remains the critical fuel source that powers modern
industrial societies (ibid).
Consequently, the emerging industrialisation and the growing depend-
ence on imported materials at the advent of the 20th century necessitated
the need to access resources from abroad for an expanding oil industry
(Le Billion, 2004:3). For example Standard Oil expanded its business to
the Caspian and bought 100,000 tonnes of oil at $33 per tonne from the
Azerbaijani government in June 1919 (O’Hara, 2004:142). The significant
role of oil in the First World War led to the scrabble for more oil after the
war and the partitioning of the Middle East among the various Western
Nations for secure supply of oil (Le Billion, 2004:3). This was further
reinforced during the Second World War, Le Billion concludes thus:
. . . in their search for resource security and strategic advantage, industrialised
countries continued to take a diversity of initiatives including military deploy-
ment near exploitation sites and along shipping lanes, stockpiling of strategic

resources, diplomatic support, ‘gunboat’ policies, proxy wars or coup d’état to

maintain allied regimes in producing countries, as well as support to transna-
tional corporations and favourable international trade agreements. (2004:3)
A good example was the military coup that overthrew the Mossadeq’s
government because of the nationalisation of the British oil corporations
in Iran and replaced it with a pro-western Shah in 1953 (Peters, 2004:202).
There is now a ‘return’ of geopolitics due to structural changes after
2000 which followed two decades of low energy prices under a market
based regime. The September 11, 2001 attack on the World Trade Centre
twin towers in the US, the US-led invasion of Iraq in 2003, political
struggles in Russia and the Niger Delta crisis in Nigeria resulted in rapid
increases in oil prices and structural changes in the international oil
market (Trombetta, 2012:15). Also, due to the rapid economic growth and
development in developing countries particularly in the BRICS countries
(Brazil, Russia, India, China, and South Africa), there has been a global
contestation on how to secure energy security and also its attendant
potential conflicts (Smith, 2010:121).
The competition for access to oil resources will intensify as the global
energy consumption of oil and gas mostly from non-OECD countries is set
to increase by 40 per cent in 2030 (Smith, 2010:122). Over the same period
of time the production of oil and gas will decrease both in Europe and
America, this puts more pressures on the international oil supply market
leading to the ‘securitization’1 of energy, making energy security issues a
national priority for all oil importing countries (Trombetta, 2012:15 and
Smith, 2010:120).
Most of the substantial proven oil and gas reserves are now located in
the Middle East, Caspian and Africa region, where security uncertain-
ties due to conflicts induced by oil and gas are major challenges to trade
(Smith, 2010:121). There is also competition among the oil importers with
each one trying to scheme out the other: while China is close to Iran and
Russia, the Western oil consumers are also in alliance over Iraq and other
countries in the Caspian (ibid). Some of the Western countries are also
present in the Gulf of Guinea oil region in Africa, and China has also
gained a foothold for oil operation in Angola and Nigeria.
ANALYSIS OF VARIOUS ARGUMENTS ON

RESOURCE CONFLICTS AND ENERGY SECURITY
Studies by various scholars, economists and political scientists and others

have produced series of explanations and arguments on conflicts generated

by natural resources, in this case oil and gas and energy security (Klare,
2001, 2008; Watts, 2004; Ross, 1999, 2001; Le Billion and El Khatib, 2004;
Spero and Hart, 2003; Raphael and Stokes, 2011 and Collier, 2007, 2009
among others). Collier (2009) asserts that the explanations of natural
resources conflicts are more deep rooted political economy issues, ‘an
interplay between politics and valuable natural assets’.
Resource conflicts and war in resource-dependent countries, particu-
larly oil, are not limited only to the boundaries of their respective coun-
tries, but go far beyond it. The global consequences of the invasion of Iraq
by the US-led allied forces in 1990 to 1992, and since 2003, have been far
reaching. The intermittent skyrocketing increases in oil prices is the main
direct cost to the world economy, and with its macroeconomic repercus-
sions is ‘approximately $1.1 trillion’ which ‘dwarfs all other economic
cost’ (Stiglitz and Blimes, 2008:132–160).
Part of the consequences is the soaring cost of transportation in
most countries, including the oil exporters, and increasingly resulting in
‘higher food prices’ (ibid). Beyond the threat to global peace and secu-
rity through the growth of resistance and extremism throughout the
world, the humanitarian and economic costs are also alarming not only
in Iraq but also in the neighbouring countries of Syria, Lebanon, Jordan
and Egypt; civilian death estimated at over 100,000 people and ‘4.6
million people – one of every seven Iraqis uprooted from their homes’ by
December and September 2007 respectively; an estimate of over $1 billion
for Jordan alone and $123 million budgeted by the UNHCR in 2007 for
the up-keep of Iraqi refugees (Stiglitz and Blimes, 2008:132–160).
The struggles amongst various factions and political groups to control
political power at the centre in resource-dependent countries goes beyond
corruption, it actually leads to conflicts and may degenerate in many cases
to civil war if not properly managed. This is because those who control
political power at the centre are the custodians of the revenues that accrue
from the resources. Studies show that oil and mineral resource-exporting
countries are more vulnerable to violent conflicts that are particularly
secessionist in nature; they also last longer with higher casualties than con-
flicts with no resources to capture, and are mostly located in the regions
where the natural resources are located (Collier and Hoeffler, 2004, 2006;
Lujala et al 2005).
Table 4.1 below shows past and present civil wars, rebellion and militancy
in 8 selected oil and mineral-dependent countries. The wars have lasted
from three to 36 years, the free Aceh movement (GAM) rebelled against the
Indonesian authorities and fought the national army (TNI) to break away
the natural gas rich Aceh region. The conflicts in some of the countries have
occurred intermittently and still persist, for example the Sudan and South

Table 4.1 Civil wars, rebellion and militancy in selected oil and gas
dependent states
Country Duration Resources

1 Algeria 1991–2001 Oil
2 Angola (Cabinda) 1992–2001 Oil
3 Congo, Republic 1997–1999 Oil
4 Indonesia (Aceh) 1975–2005 Natural Gas
5 Iraq 1974/75, 1985–92, 2003–Present Oil
6 Nigeria (Niger Delta region) 1967–1970, 1998–Present Oil
7 Sudan 1983–Present Oil
8 Yemen 1986–87, 1990–94 Oil
Source: Ross (2001:15) and Alabi (2010:58).
Sudan, Nigeria’s Niger Delta region and particularly in Iraq from 1974 to
1975, then 1985 to 1992 and from 2003 up to October 2012.
‘The discovery of resource wealth in a discontented region may add fuel
to separatist sentiments’ (Ross, 2001:15). For example the Biafra rebel-
lion in Nigeria, the Cabinda enclave in Angola, and the Aceh rebellion in
Indonesia. Karl argues that ‘Oil may be the catalyst to start a war; petro-
dollars and pipelines may serve to finance either side and prolong conflict
and this, of course, is the biggest resource curse of all’ (Karl, 2005:26). The
Azerbaijan government’s additional US$35 million in military spending in
the 2004 budget did not provide any direct benefit to the citizens (Shultz,
2005:35).
Collier (2009) posited that an increase in the prices of natural resources
in the international market also increases not just the propensity of con-
flict in resource-dependent countries, but also the period of war once it
has started. In his analysis he identified three reasons for this: the first is
that the atmosphere of conflicts creates the possibility for the rebel groups
to have illegal access to the natural resource, be it oil or gas, as is the case
in Angola and Nigeria, and use part of the proceeds from the sales to
broaden and sustain the conflict. Secondly, most recruits to rebellion are
motivated by loot-seeking rather than fighting for any political cause: even
when the conflict began with a political motivation it will in the long run
result in loot-seeking. Thirdly, rebellion might be a consequence of inad-
equate or lack of accountability to their citizens by governments of most
natural resource-dependent countries (Collier, 2009:5–6).
Conflicts create an atmosphere of fear, and may allow rebel or militant
groups to illegally tap pipelines to steal oil, or seize gas fields, or carry out
other nefarious acts like kidnapping and extortion to finance and elongate

conflict periods. The main motivation behind insurrections, rebellions

and wars in resource-dependent developing countries is not just about
greed or the desire to loot; in most cases it is resistance to and reaction
against long-term neglect and socio-economic deprivation in the mineral
resource rich regions, the capture and corrupt control of the revenues
accruing from such resources by the central governments and their lack
of accountability to the citizens. This explains why these type of conflicts
over resources are not happening in Norway or other developing resource
rich countries such as Qatar and United Arab Emirates. If the causes of
wars are merely because of the presence of natural resources or greed to
loot, and not resistance against socio-economic deprivation, marginalisa-
tion and lack of accountability, the same conflicts should be happening
in other developing resource-rich countries. Thus Ake (2000) concludes
that most conflicts labelled as ethnic conflicts are nothing but democratic
conflicts where groups or societies who have been denied benefits from the
national resources for so long struggle to regain their rights and access to
the commonwealth as citizens (Ake, 2000:10).
THE INTERRELATIONSHIP BETWEEN ENERGY

SECURITY AND RESOURCE CONFLICTS
This section will help to explain the interrelationships between the energy
security agenda of the global North and the nature of conflicts and under-
development in the oil and gas producing countries of the global South.
From the end of the cold war to the early 1990s there has been an increase
in internal and regional conflicts in many resource developing nations,
which have led to massive humanitarian interventions by international
NGOs and the United Nations, and also a new form of global govern-
ance by governments in the global North (Duffield, 2001:1). In essence,
it is clear that by ‘the mid-1990s the need to address the issue of conflict
became a central concern within mainstream development policy’, which
was previously in the purview of international and security studies (ibid).
The major explanation for this could be traced to the unequal integration
of the South into the global capitalist system and the nature of this contin-
ued exploitative relationship between the global North and South in terms
of trade, raw materials and cheap energy (oil and gas by all means and at
all cost) to power the industrial development in the North. The conflicts
were further aggravated by the concentration of formal trade, technology
and international finance in the North and East Asia since the 1970s, to
the severe exclusion of the global South (Duffield, 2001:2). This exclusion
and declining investment particularly in Sub-Saharan Africa has now led to

escalating contestation around resource capture – including the state, crimi-

nalisation, breakdown of law and order and a global criminal economy
network (ibid:6–7). The crisis in the oil producing Niger Delta of Nigeria is
a classical example, where the militants in the early 1990s began to attack oil
installations, kidnapping IOCs personnel and demanding ransoms for their
release. This soon graduated into a large network of gangs in collaboration
with high ranking military officers and top government officials stealing
oil from the pipelines and selling to foreign vessels at a cheaper price on the
high seas. Some of the proceeds are in turn used to buy arms and ammuni-
tions to perpetuate their hold on the oil resources. The adverse social and
economic effects of this are not only felt locally within Nigeria but also
globally, as any major disruptions to oil production in the Delta or in the
Gulf of Guinea sends the price of oil higher in the international oil market.
Therefore the current global security challenges go beyond interstate
wars: ‘the threat of an excluded South fomenting international instabil-
ity through conflict, criminal activity and terrorism is now part of a new
security framework’ in which ‘underdevelopment has become danger-
ous’ (Duffield, 2001:2). This has led to the radicalisation of development
policy, which is merging conflict resolution with a neoliberal global gov-
ernance agenda of social transformation of societies in the global South
(ibid). Although it is exclusion and contestation for the few resources
that has led to the conflicts, viewing underdevelopment as dangerous and
as an agent of destabilisation is enough reason for policing and engage-
ment with the governments of the South (ibid:7). For example in the
Gulf of Guinea the establishment of the United States African Command
(AFRICOM) Africa Partnership Station to police the oil facilities in the
region is unsolicited assistance to protect the energy security interests of
the North (Raphael and Stokes, 2011:909–911).
Internationalisation of public policy is also part of the new security and
governance framework; governments in the South are controlled by means
of ‘conditional selective inclusion’ (ibid:7–8). Thus, they are required to
execute international laws such as anti-terrorism, anti-money laundering
and the Kimberley process, for the sake of global peace and security. The
processes of inclusion are sometimes stratified, depending on which side is
to profit most (ibid).
ENERGY SECURITY AND OIL CONFLICTS: THE

CASE OF THE NIGER DELTA, NIGERIA
This section focuses on the persistency of the Niger Delta crisis and com-
petition for resource control by those in the Delta, and argues that the

acceleration of struggle and contestation around resource capture has

escalated dramatically and shaped policy regarding fiscal federalism. It
then examines the resultant socio-economic and environmental impacts
of the crisis and how that challenges the sustainability of oil production
in Nigeria. The conflict in the Niger Delta has a fairly long trajectory: the
structures for the present conflicts were laid by the colonialists and the
first Nigerian political leaders, which successive regimes have built on and
nurtured. After independence in 1960, the post-colonial Nigerian state
continued unabated the totality of power it inherited from the colonialists
over land and all mineral resources (Omoweh, 2006:40). Consequently, the
first post-colonial Nigerian leaders jettisoned the Willink Commission’s
report, abandoned its implementation and the development of the Niger
Delta Development Board, NDDB and thereby laid the foundation for
the current crisis.
The first post-colonial oil conflict in the Niger Delta region was
sparked by Isaac Adaka2 Boro in February 1966 (Tebekaemi, 1982:6 and
International Crisis Group, 2006:4).
The contemporary crisis threatens not just the oil exploration and
exploitation in the Niger Delta region but ‘everything’ about Nigeria:
unity, politics and socio-economic development to its foundation. Echoing
this fact Bush (2007:613–4) posits that:
Resistance is at fever pitch in the Niger Delta. It is opposition to international

oil companies and Nigerian state collusion with exploitation in the region. It is
opposition to corrupt local politicians and leaders and it is driven significantly
by the youth.
By the late 1990s, the situation in the Niger Delta had transformed
into aggressive agitations and violent protest of unprecedented dimen-
sions that shook the very foundations of the Nigerian nation (NDDC,
2002:5). Violence and youth restiveness increased greatly as Nigeria
approached the return to democracy in May 1999. Youths in the region
began to lay siege to oil installations and kidnapped oil workers from
various IOCs, making it unsafe for any socio-economic activity to thrive
(Djebah, 2003:3). The armed resistance started by Isaac Adaka Boro’s
12-day revolution in February 1966 transformed to the commando-style
operations of the Movement for the Emancipation of the Niger Delta
(MEND).3 Consequently, militant groups have increased deadly attacks
on oil facilities and IOCs personnel from 2000 onwards and have taken a
higher dimension since 2005 with activities of MEND, attacking offshore
oil facilities 200 kilometres below sea such as the Bonga FPSO platform
and shooting at IOCs servicing helicopters.
The conflicting claims to oil resources in the Niger Delta between the

federal government and the oil producing states provide major challenges
to the Nigerian state, due to the intensity with which several oil produc-
ing states are clamouring for control of oil resources in their region. As
asserted by the International Crisis Group (ICG) ‘a potent cocktail of
poverty, crime and corruption is fuelling a militant threat to Nigeria’s
reliability as a major oil producer’ (ICG, 2006:1). Corroborating the ICG,
Soyinka (2008) noted:
What is happening in the Delta today, points a finger of guilt in so many direc-
tions and of course, the primary is within Nigeria itself and what Nigerian
leaders have made of this incredible opportunity and however, but at the
expense of some of the people within the Delta region. Then of course the
oil exploration companies with their contempt for basic minimum standard
of conduct towards the areas, the indigenes from whom this wealth is been
dredged. So very often it is a matter of embarrassment, a guilt feeling and so
they pretend it is just a few people restless, violence and kidnapping and so on
whereas this problems goes back decades.
The Niger Delta Crisis: From MOSOP to MEND 1990–2012
From 1990, the late Ken Saro Wiwa,4 the founding leader of the
Movement for the Survival of the Ogoni People (MOSOP), led the Ogoni
struggles against the Shell Petroleum Development Company (SPDC)
and the federal government to put an end to the environmental destruc-
tion orchestrated by SPDC against the Ogoni people in the name of oil
exploration (Rowell et al, 2005:2; Watts, 2007:652). MOSOP produced the
Ogoni Bill of Rights, which was signed in August 1990 and presented to
the federal government. It demanded ‘political control of Ogoni affairs by
Ogoni people and the right to protect the Ogoni environment and ecology
from further degradation’ (Rowell et al, 2005:3). Instead of responding
to the Bill of Rights, the IOCs and the federal government deployed the
security forces to all the oil installations and the towns of Ogoniland,
banned all public protest, and decreed any demand for self-determination
and obstruction of oil production in any form as an act of treason which is
punishable by death (Osaghae, 1995:336). The threats by the government
only propelled the full scale mobilisation and mass attendance of thou-
sands of protesters at the Bori rally of 3 January 1993 (ibid).
This Bill of Rights and the tenacious campaign both at local and
international level to popularise and enforce its aims drew the attention
of the international community to the Ogonis’ plight. The publicity and
campaigning forced SPDC to call off its production throughout the Ogoni
land in 1993 (International Crisis Group, 2008:2 and Osaghae, 1995:336).
The ensuing circumstances brought MOSOP, led by Ken Saro Wiwa and

the Ogonis, into direct confrontation with the Nigerian government and
SPDC. On 21st May 1994 a crisis led to violence between the pro-SPDC
Ogoni elders, who were accused by the radical Ogoni youths of receiving
largesse from SPDC to scuttle the Ogoni struggle process; four Ogoni
elders were killed. It was the moment the government had been waiting
for to finally nail MOSOP and its leaders (International Crisis Group,
2008:2–4).
Ken Saro Wiwa and other MOSOP leaders (including Mr Ledum Mitee,
the chairman of the Federal government 2008 Technical Committee on the
Niger Delta who was arrested but later released), were tried by a Special
Military Tribunal that was constituted by the Abacha regime to try their
case in 1995. They were sentenced to death by hanging with the collabora-
tion of Shell Petroleum Development Company (SPDC) and other IOCs.
Although the SPDC strongly denied their involvement in Saro Wiwa and
other MOSOP leaders’ trial and death, they had a legal representative,
a hired Queens Counsel (QC) flown into Nigeria from London on the
account of SPDC, who monitored the whole trial process (Rowell et al,
2005: 4–5).
On 10th November 1995, Saro Wiwa and eight others were executed by
hanging after 18 months incarceration. To make matters worse the gov-
ernment created more psychological torture for the families of the dead
MOSOP leaders: rather than releasing the bodies to the families, acid was
poured on to the bodies to be sure that they were destroyed, even after
they were certified dead by medical personnel at the hanging (Rowell et
al, 2005:4–5). Apart from protests against SPDC in Europe and America
where it had operational bases, and in a couple of Nigerian foreign mis-
sions, the Commonwealth reacted to the killings at its summit in New
Zealand by suspending Nigeria, and its delegation led by Mr Tom Ikimi,
the Nigerian former foreign minister, walked out. The Nigerian govern-
ment and Shell were also condemned by the United Nations Human
Rights Commission, the European Union and the US States Department.
However, all of them failed to act with any real effect, because the issue
at hand was about security of supply;5 an oil embargo on Nigeria ‘was
deemed unacceptable to the United States’ (Rowell et al, 2005:12). With
the inability of the international community to reprimand Nigeria’s mili-
tary regime, it was ‘mission accomplished’ and the resumption of business
as usual by both SPDC and the federal government in the Niger Delta.
As the security forces continued their crackdown on the residents of oil
producing communities Soyinka (2008) noted:
The international community to some extent felt that this crime committed
against the representatives of the Nigerian people, the defenders of the ecology,

the protectors of the right of indigenous people, Ken Saro Wiwa and his com-
panions, when this crime was committed under such a public global glare that
it would compel the oil companies to tidy up their acts, and to some extent it
did for a short while. But they become complacent once again (Soyinka, 2008).
The Rivers State Internal Security Task Force (a military special squad
put together by the military regime) in conjunction with Lt Colonel Musa
Komo, the state military governor, started negotiating with SPDC to
resume operations in Ogoni. At the same time the chiefs and villagers were
also intimidated into signing documents for SPDC to return to Ogoni. At
the final sitting of the Special Military Tribunal in 1995 Saro Wiwa made
this closing statement:
I repeat that we all stand before history. I and my colleagues are not the only
ones on trial. Shell is here on trial . . . but its day will surely come and the
lessons learnt here may prove useful to it. There is no doubt in my mind that the
ecological war that the company has waged in the Niger Delta will be called to
question sooner than later and the crimes of that war be duly punished. (Rowel
et al, 2005:211)
This statement by Saro Wiwa found fulfilment on 4th June 2008 when
the federal government announced the final withdrawal of SPDC’s
operating licence which has been suspended since 1993, and ordered the
closure of all its operations in Ogoni land by December 2008. According
to late President Yar’Adua it was evident that ‘there was a total loss of
confidence between the Ogoni people and Shell, government decided that
another operator acceptable to the Ogonis will take over all oil operations.
Nobody is gaining from the conflict and stalemate, so this is the best solu-
tion’ (Nigerian Tribune, 2008). On 6 June 2008 Corroborating President
Yar’Adua, Ledum Mitee said ‘we agree that the relationship between Shell
and the Ogoni people has been damaged irreparably and therefore, the
president’s decision is timely and appropriate’ (Nigerian Tribune, 2008).
After the Ogoni crisis, from April 1997 onwards protest against all the
IOCs in the Niger Delta increased considerably and this time it was not
just against SPDC. The military government and the oil technocrats had
‘feared all along; that other communities, inspired by Ken Saro Wiwa and
the Ogoni struggle, would rise up against the devastation of their envi-
ronment’ (Rowell et al, 2005:18). Thus, the various youth groups began
to form resistance movements across the Delta region. The first of such
groups was the ‘Chicoco movement’ formed in August 1997 by Oronto
Douglas6 in Ijaw town of Aleibiri, Bayelsa State with over 1,000 youths
(Rowell et al, 2005:18).
The Chicoco movement was a forerunner to the formation of the Ijaw
National Congress (INC) which managed the implementation of the

Kaiama declaration. In Bayelsa State, the Ijaw youths, under the umbrella
‘Egbesu Supreme Assembly’, drawn from over 500 communities and 40
clans that made up the Ijaw nation and 25 representative organisations,
met in Kaiama on 11th December 1998, ‘to deliberate on the best way to
ensure the continuous survival of the indigenous peoples of the Ijaw ethnic
nationality of the Niger Delta within the Nigerian state’ and put forward
the ‘Kaiama Declaration’. The declaration states that:
As a step towards reclaiming the control of our lives, we, therefore, demand
that all oil companies stop all exploration and exploitation activities in the Ijaw
areas. We are tired of gas flaring; oil spillages, blowouts and being labelled
saboteurs and terrorists. It is a case of preparing the noose for our hanging. We
reject this labelling. Hence, we advise all oil companies’ staff and contractors
to withdraw from Ijaw territories by 30th December, 1998 pending the resolu-
tion of the issue of resource ownership and control in the Ijaw area of the Niger
Delta. (Ijaw Youths Centre, 1998)
This declaration was synonymous to declaring an ‘Ijaw Nation’ and

war on almost all the oil companies in their area (Essien, 1999:5). They
also set up the Ijaw Youth Council (IYC) to coordinate their struggles for
self-determination and justice (ibid). Installations owned by oil companies
were not only seized, but oil production ground to a halt which also led
to a substantial revenue loss to the Nigerian government and increased oil
prices in the international market.
Federal Government and IOCs Security Responses to the Oil Conflicts
The state continued with the militarisation of the oil producing communi-
ties as a response strategy at the instance of community protest. The posi-
tion of the government and the IOCs was that the community protests,
agitations and losses which result from these disasters amounted to acts
of sabotage, and this prompted their actions in an attempt to stem the rate
of increasing communal clashes and violence. Whenever there are crises,
the government often reacts aggressively by drafting the security forces for
reprisal attacks to quell the militants, who are branded criminals, looters
and saboteurs7 of the economy. Generally when the militants could not
be found, the security forces turned their grievances on the communities
resulting in many casualties and loss of innocent lives, and in the process
exterminating some villages and communities in the Delta. This led to the
emergence of more youth groups: from 1998 to 2012, apart from MOSOP
and the Chicoco movement, over 30 ethnic-based minority rights groups
have emerged across the Delta region (Adejumobi, 2002:6 and Ojakorotu,
2005:3). The strategies and tactics of these movements have changed over

the years from non-violence to increasingly militaristic and commando-

style armed groups; this was to ‘counter what local groups viewed as
military’s repressive tactics’ by the Nigerian government’s security forces
(International Crisis Group, 2006:5). Thus there are constant conflicts
between state and various movements in the Delta over resource extraction.
The IOCs are too confident of protection from their own security forces
and that of the federal government, and are quick to call for the State’s
security forces to quell community protest. That normally leads to heavy
casualties on the side of the host communities due to the excesses of the
security forces. For example on 29th October 1990 the SPDC Divisional
Manager in Port Harcourt ordered state security forces through the Rivers
State Commissioner of Police to quell the ‘impending militant attack’ on
Umuechem flow station (Frynas, 2001:50). The events of 30th and 31st
October 1990 were a serious crisis as ‘Mobile Police moved in with teargas
and gunfire, killing about 80 people and destroying almost 500 houses’
(ibid and International Crisis Group, 2006:6). The judicial commission
of inquiry later found there was no planned attack, as alleged by SPDC’s
manager, because the youth protests were non-violent and the youths were
not armed (Rivers State Government, 1991).
The oil producing communities are therefore at the mercy of armed secu-
rity personnel, police and military, who constitute the Joint Task Forces.
Some of these use the cover of providing security and maintaining law and
order to torture and terrorise innocent citizens, openly demanding bribes
from motorists and cyclists. Thus, ‘the ugly relationship between oil and
violence has played out along very clear lines in Nigeria’ (Klare, 2004:127).
From 1966 to 1999 the country was ruled at various times by the military,
which having forcefully taken power had squandered massive oil revenues,
leaving the Niger Delta region to wallow in poverty: this led to the increase in
ethnically based militias in the Niger Delta (Klare, 2004:127). Consequently,
the few key actors in Nigerian domestic policy facilitate and encourage a
mutually dependent process of systematic looting of the country’s oil wealth
(White and Taylor, 2001:324), and therefore have no incentive to change the
fraudulent mutual dependency between the IOCs and the various regimes
that have ruled the country. The responses of the IOCs and the government
through militarisation have been counterproductive as they generate more
crises. The next section will examine the impacts of such crises.
The Socio-Economic Impacts of the Conflict on Nigeria and the

International Oil Market
The conflicts in the Niger Delta have impacted negatively on Nigeria and
is difficult to quantify. The international community feels the effects par-

ticularly in terms of volatility in the price of oil in the international market.

This section will examine the impacts of the conflicts in terms of economic
and other social losses including kidnapping, sabotages, oil bunkering,8
gangs and the resultant effects.
Events in the Niger Delta took another dimension in January 2006 when
four expatriate oil personnel were kidnapped. All were employees of the
Shell contractors Tidex and Ecidrill and were kidnapped from a support
vessel in the Exploration Area (EA) shallow offshore field operated
by Shell Petroleum Exploration and Production Company (SNEPCO)
(Oduniyi and James, 2006). The Movement for the Emancipation of the
Niger Delta (MEND) claimed responsibility for the kidnapping; MEND
demanded the release of Mujahid Asari Dokubo, the leader of another
militant group, Niger Delta Peoples Volunteer Force (NDPVF), who had
been incarcerated but was later released by the federal government as part
of the efforts to calm the militants’ activities. They also demanded US$1.5
billion compensation for oil pollution to the Ijaws, an ethnic group in the
Niger Delta (Daniel and Olaniyi, 2006).
As a result of the attacks on oil installations across the Niger Delta,
IOCs including SPDC, Italian energy giant Eni SpA, ChevronTexaco
and ExxonMobil among others, declared force majeure intermittently
from the emergence of MEND in December 2005, culminating in up to
1.3 million barrels per day (bpd) shut-in of crude oil by the end of 2006
(Nigerian Guardian, 2008). MEND sent a clear signal to the IOCs and
federal government that no oil installation within the Delta was unreach-
able when they launched a major attack on the 225,000 barrels per day
floating production storage facility in SPDC’s Bonga oil FPSO, about 200
kilometres below sea on 19th June 2008. It was automatically shut down
and resumed production after a few weeks (Amaize, 2008) and according
to General Boyloaf 9:
We really wanted to prove that nowhere is untouchable that is why we visited

there. We wanted to make this point because Shell and Chevron, all of them
are moving offshore. So we visited them to prove that there is nowhere to hide.
(Lloyd-Roberts, 2009)
The Commission for Africa (CFA), in its report on the British All Party
Parliamentary Group (APPG) delegation’s evaluation of the Niger Delta,
urged the Nigerian government to stop the yearly theft of an estimated
N625 billion (£2.5 billion) of the country’s oil resources (Obayuwana,
2006:1). Mutiu Sunmonu, the Managing Director of SPDC, also told the
delegates at the Nigerian Oil and Gas conference and exhibition in Abuja
on 24th February 2009 that ‘even with low oil prices, the Nigerian govern-
ment loses between $1 billion and $1.5 billion every year to crude theft

and pose a threat to oil loadings from export terminals’ which was then
reduced to six hours daily because of the security situation in the Niger
Delta (Igbikiowubo, 2009). The restive Niger Delta youths exchanged the
smuggled oil for firearms from their buyers, and the youths in return used
firearms to attack and vandalise oil installations for the accumulation of
more crude oil to be smuggled out for sale (Laba, 2004:3). In his overview
of the Shell Petroleum Development Company (SPDC) of Nigeria to the
British All Party Parliamentary Group (APPG) on the Niger Delta in
August 2005, Basil Omiyi, the former Nigeria Chair, declared that ‘it is
clear for this level of oil theft to continue at its current rate, it is highly
organised’ (Obayuwana, 2006:1).
Other costs included huge annual expenditure on security for oil workers
and facilities by the IOCs. According to the country security manager of
Addax Petroleum Nigeria, at the 2008 Offshore West Africa (OWA) con-
ference in Abuja, IOCs operating in Nigeria jointly spent an estimated
$3.7 billion on security in the Delta in 2008 alone, while the figures for
2007 stood at $3.5 billion (Alike, 2009). It is disheartening to note that in
2008 alone security against the militants cost the IOCs $3.7 billion (N432.9
billion) (ibid), almost five times as much as the government’s budget for
the region in 2009 (N77 billion).
Intra-Community Crisis, Inter-Community Conflicts, Inter-Ethnic Clashes

and Conflicts Between Communities and IOCs
Since the early 1990s, intra and inter-community, inter-ethnic conflicts

and community protest and violence against the IOCs in the oil producing
areas have been increasingly rampant, resulting in serious socio-economic
loss to the Delta region and the country. The increasing unrest has been
mostly due to the high level of underdevelopment in the Delta.
The intra-community crisis

The intra-community crisis is usually between members of a clan, village or
ethnic group with communal identity (UNDP, 2006:113). A good example
was in Nembe, Bayelsa state, where the IOCs reached an agreement with
the local chiefs on the mode of payment of compensation through cash,
job opportunities and contracts for the locals, but through greed the chiefs
allocated more of the benefits to themselves and their associates. The
youths and other excluded members of the community began a protest:
they occupied flow stations, harassed oil workers and took hostages to
force the IOCs to renegotiate and pay them their dues (ibid). Because such
payments are huge, at least in local terms, the youth group soon disinte-
grated into several gangs and continued to extort money from the IOCs.

The result was a reign of terror in Nembe, with violent clashes between
the various rival youth groups resulting in mass loss of life and property
(ibid, 115).
The manner in which the pursuit for compensation was carried out
among the communities has over time helped to exacerbate conflict.
Onosode (1998) posits that:
There is a considerable mistrust between elders and youths, between traditional

rulers and their subjects. The older groups are perceived by the youths to have
‘sold out’; others are branded ‘Oil company chiefs’. (Onosode, 1998:39–41)
According to a World Bank report, ‘compensation may not be paid

to the affected community or individuals – because other communities,
disbursement agents, or powerful individuals may keep the compensation
funds’ (World Bank, 1995: 72).
In an article on this subject, Ibeanu echoes the World Bank’s view by
asserting that ‘The leaders of communities in the Niger Delta are very rich,
and at the same time their people are extremely poor’ (Ibeanu, 2002:163).
By the end of February 1998, about 14,000 claims for compensation for
oil related damages totalling an estimated US$100 million had been sub-
mitted to Nigerian courts by individuals, groups and communities in the
region (ibid).
Inter-community conflicts
Inter-community conflicts occur when communities are not satisfied with
the outcome of a settlement by the government, traditional authorities or
court. In an on-going agitation, usually over ownership of land and other
natural resources, mostly the male youths of two or more warring commu-
nities begin fighting, setting houses and business premises ablaze (UNDP,
2006:115). For example, the conflict that emerged as a result of the loca-
tion of SPDC’s oil flow station in the Olomoro and Oleh communities of
Delta State, occupying 20 per cent and 80 per cent of land in the two com-
munities respectively. The government responded swiftly and drafted the
security forces to maintain law and order, but the security forces instead
burnt down the Oleh community (ibid, 118).
Ethnic clashes
Ethnic clashes have also been on the increase in various parts of the Delta
region; these include Urhobo versus Itsekiri, Ijaw versus Itsekiri in Delta
state, Ogoni versus Okrika, Andoni versus Ogoni in River state and the
Ilaje versus the Ijaw in Ondo state. While some of these conflicts are his-
torical and predate the discovery of oil in the Niger Delta, others were

rovoked by the actions of the government and IOCs (UNDP, 2006:118).

p
For example the violent conflicts which involved the Ogonis and Andonis
from July to September 2003, and the Ogonis and the Okrikas in December
of the same year, seemed to have some support from the government and
IOCs in order to thwart the Ogoni agitations, as the leaders of both the
Ogonis and Andonis asserted publicly through the media that they had no
disagreements before the attacks (Osaghae, 1995:37–38). At the end of the
conflict, over 1,000 Ogonis had been killed and 30,000 people displaced
from their communities (ibid).
Conflicts between communities and IOCs

Conflicts between communities and IOCs emerge as a result of general
dissatisfaction with the benefits from oil. They bear the impact of the
consequences of oil exploration –gas flaring, oil spillages, blowouts and so
on – and government policies failed over the years to translate oil wealth
into meaningful socio-economic development for the communities. The
reactions to their frustrations over the years sometimes resulted in protest
against the IOCs, epitomised by hostage-taking, sabotage to oil installa-
tions, damage to pipelines, flow stations and oil export terminals. This
series of reactions from the communities in the Delta propelled the IOCs
led by SPDC to establish a ‘supernumerary police’ in the early 1990s in
conjunction with the Nigerian Police Force in the Delta to protect their
facilities. On 1st December 1993, Phillip Watts, then SPDC’s Nigeria
Managing Director, requested the police authorities to increase the ‘super-
numerary police guards’ (or the ‘spy police’) from 1,200 in 1993 to 1,400 in
1995; this was in addition to other private security personnel engaged by
the company (International Crisis Group, 2006, HRW, 1999:116; Frynas,
2001:51). The Joint Task Force (JTF) – the Army, Navy and the Police
– was also deployed by the federal government to provide security in the
Delta region and the waterways, which come under the federal govern-
ment’s authority (SPDC, 2006:8).
CONCLUSIONS
This chapter started by examining the significant role of oil in fuelling

modern industrial development, and then examined the role of oil in both
domestic and international politics and conflicts. It noted that the history
of the international oil market has been one with prolonged conflicting
interest where both producers and consumers strive to influence the direc-
tion of the market in their favour, and argued that the main aim on the part
of the consumer nations is to secure energy security. Various factors are

responsible for the instability of oil prices in the international oil market
and conflicts in different oil and gas geopolitical zones of the world. Some
of the major factors include the two gulf wars of the 1990s, the September
11 terrorist attack by Al-Qaida on United States in 2001, and the US-led
invasion in Iraq in 2003. After these events oil prices began to rise and
there was a related realignment in global geopolitics of oil and gas.
This chapter also posits that there is an interrelationship between the
energy security agenda of the Western world and the nature of the con-
flicts and underdevelopment in the oil and gas producing countries in
the global South. The unequal integration of the South into the global
capitalist system and the nature of this continued exploitative relationship
between the global North and South is driven by uneven terms of trade in
relation to raw materials and cheap energy (oil and gas by all means and at
all cost) to power the industrial development in the North.
Two levels of resource conflicts were also analysed: at the macro level
which concerns conflicts of interest between the IOCs, the Western nations
and producing nation governments over fiscal regimes and contracts,
negotiations and unwillingness to grant access to particular IOCs; and at
the micro or local level between national governments and other stake-
holders in the producing nations. A detailed illustration was provided by
the case study of the Niger Delta in Nigeria where various militia groups
turned the oil producing region into a battle ground as a result of lack
of access to socio-economic development and opportunities from the
oil industry in their region. The main motivation behind insurrections,
rebellions and wars in resource-dependent developing countries is not
just about greed or the desire to loot; in most cases it is resistance to and
reaction against long-term neglect and socio-economic deprivation in
the mineral resource rich regions, the capture and corrupt control of the
revenues accruing from such resources by the central governments and
their lack of accountability to the citizens. Therefore, I conclude that most
conflicts labelled ‘resource conflicts’ occur where groups or societies who
have been denied benefits from their national resources struggle to regain
their rights and access to these benefits. The Western nations, IOCs and
oil producing governments need an alliance to ensure the benefits of the
resources reach the citizens of the producing nations. Otherwise, the con-
flicts will continue as it will always be worth fighting for denied benefits.
NOTES
1. Securitisation is ‘the discursive process through which an inter-subjective understanding

is constructed within a political community to threat something as an existential threat to

a valued referent object and to enable a call for urgent and exceptional measures’ (Buzan
and Wæver 2003, 491). This process ‘legitimizes actions outside the normal political
process’ (Buzan et al, 1998, 24, quoted in Trombetta, 2012:2).
2. Isaac Boro an Ijaw, former school teacher and police officer in the Nigerian police
force, was born on the 10th September 1938 in Oloibiri where the first oil was struck by
Shell Petroleum Development Company (SPDC). He landed in Tontoubau in Bayelsa
State on the 23rd February 1966 accompanied by 159 men, and launched a guerrilla
war against the Nigerian government. He led an armed showdown against the Nigerian
Police Force in a bloody battle and defeated them with a ragtag force of native com-
rades. They then grounded all oil exploration activities in the region, declared the State
of the Niger Delta People’s Republic and instructed all IOCs to deal directly with Boro.
They engaged in battle for 12 days before they were rounded up by the federal govern-
ment forces with the help of the SPDC and were tortured, tried and condemned to death
(Tebekaemi, 1982:6).
3. Movement for the Emancipation of the Niger Delta is an armed and formidable militant
group based in the cities and creeks of the Niger Delta, particularly in the western region
of the Delta in and around Warri (the so-called ‘Warri axis’). MEND is responsible for
‘shutting-in’ 40 per cent (November, 2008: approximately 900,000 barrels per day) of
Nigeria’s oil industry through making direct attacks on facilities, taking hostages, and
generally creating an inhospitable and unsafe environment for the oil industry (Kashi and
Watts, 2008:3).
4. Ken Saro Wiwa is an author, environmental activist and businessman.
5. The energy security (security of supply) issue is also about geopolitics: consider the geo-
political position that Nigeria seems to have in relations to the ECOWAS region, and the
US Africa Command (AFRICOM). Nigeria is seen as a steady regional policeman for
the whole Gulf of Guinea up to Angola. Michael Watts posits that a geo-strategic driver
was involved (Watts, 2004).
6. An environmental activist and lawyer and one of the youngest attorneys on Saro Wiwa’s
defence team against the Nigerian government tribunal in 1995. Senior Special Assistant
to the Nigerian President on Research and Strategy 2011 to the present.
7. The accusations by the governments and the IOCs against the people of the Delta of
sabotage and belonging to criminal gangs are similar to the way oppressive regimes treat
resitance to law and order issue. This started in the colonial period when the Colonial
government reacted in a similar way to the attacks on the Royal Niger Company head-
quarters by the youths who protested against RNC’s monopoly in the palm oil trade in
Brass in 1894.
8. Oil bunkering is the illegal tapping of both crude and refined oil into barges or other con-
tainers and loading them on to tankers or cargo ships for sale locally or to neighbouring
countries and other buyers in the international oil market.
9. One of MEND’s senior commanders.
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5. Global energy supply: scale, perception
and the return to geopolitics
Susanne Peters and Kirsten Westphal
1 INTRODUCTION
Energy security is back on the agenda. No longer is it an issue of the past

like it was during the 1973/74 and 1979 crises.
During the heyday of globalization in the 1990s, energy was increas-
ingly framed as a commodity among others with markets taking care of
trade flows between producers and consumers. Since the early 2000s, the
growing consumption of China and India has resulted in tightening of
the hydrocarbon markets and consequently in rising prices. Moreover,
with the 2003 Iraq War it became evident that a geopolitical approach
to energy has revived again as a policy paradigm. This large-scale war
between a third world country and a Western coalition, led by the United
States, which was also fought to gain access to Iraq’s vast untapped
potential brought home the message that “territory”, “geography” and
“state interest” are major categories for constructing energy relations
again.1
Whereas in the United States the geopolitical narrative has been closely
related to oil, the storyline in Europe is somewhat different: in the EU,
natural gas deliveries from Russia have been framed in geopolitical terms.
United States criticism on the Soviet-German gas-pipe deals accompanied
the trade relationship from the very beginning. More recently, the new
Eastern and Central European member states raised the issue of energy
security vis-à-vis Russia in a more pronounced way and the Russian-
Ukrainian gas crises in 2006 and 2009 were framed as a case in point.
We will focus on oil and natural gas, because indeed, these are the two
strategic resources around which geopolitical strategies center, and which
are seen as potential sources of conflicts over access, use and distribution.
In a multipolar age in which power is diversified among many interna-
tional actors across nations, and with multilateralism in crisis, these note-
worthy incidents raise the question whether disputes over territory and
natural resources will again turn into important factors in international
politics and whether interstate war is indeed back on the agenda. The
concern about “energy security” and its geopolitical framing and hence
92

Global energy supply 93
“geopolitics of energy” and the securitization of energy is back and now a

priority issue for governments.
In this brief chapter, we examine the geopolitical and theoretical bases for
a renewed emphasis on energy security. Starting from a discussion of theo-
retical concepts we then look at how “sector fundamentals” have affected
scholarly discussion of energy supply. It has to be emphasized, though, that
energy is about geography. Thus, we will start with a mapping of hydro-
carbon resources as a given underlying reality of producer – consumer and
transit relations. We will also make the point that the landscape of energy
is changing profoundly when you take unconventional energy resources
and most prominently the shale gas revolution in the US into the picture.
We emphasize that the supply situation is characterized by “unprece-
dented uncertainty”. Third, we analyze different phenomena of the past
decade – high and volatile prices, increasing resource concentration, per-
ceived scarcity and state interventions – that have fuelled the fear of resource
conflict. This will also shed light on the fact that the dominating mechanism
for access and distribution of resources is pricing, not state intervention.
Having said this, it is important to preclude that globalization is in retreat.
Price structures start to differ between the various regions. Fourth, we focus
on prominent case studies that have been analyzed under the geopolitical
lens. These case studies illustrate that it makes a difference how analysts
describe and frame the actual development in the markets. “Energy secu-
rity” is indeed back on the agenda, but how governments and/ or markets
pursue such an elusive goal is very much – following these analysts – a ques-
tion of their integration into the global economy, their pluralistic structures,
“good governance” in the sector, as well as the perception of the tightness
of the future supply market and the availability of power projections forces.
2 RETURN OF TRADITIONAL
GEOPOLITICS – WHAT IS “GEOPOLITICS”?
The concept of geopolitics which dates back to the late 19th century
currently is enjoying a revival.2 While used in the post war era with
caution – because of its connection to Nazi Germany – the term was still
a useful tool to analyze the relationship between the superpowers and its
effects on different regions of the world. Concepts like “geo-strategies”
and theories of “falling dominos” were used to explain “influence and
control over other states and strategic resources” (Profant 2010, 41).
These approaches were deeply rooted with theories of realism and neo-
realism, focusing on the state as the main actor in the international system.
According to these approaches, dominance and hegemony over territories,

population and endowment of natural resources shape international

relations.
Under a geopolitical lens, energy relations are analyzed as state rela-
tions driven by state and foreign policy interests. Energy resources are seen
as a source of conflict but also as a power tool in international relations.
This “securitization” of energy relations has been lately (again) promoted
first by US scientists and political circles and then spread to Europe (Götz
2012, 436). Whereas in the US the major focus is on oil, in the EU the
gas deliveries from Russia and the EU’s import dependency have fuelled
geopolitical approaches.
Michael T. Klare explicitly adheres to a geopolitical approach using
traditional and realist concepts. He is a prominent and prolific scholar
in the field of the geopolitics of energy security. For more than a decade
he has warned that the international oil system is soon to break down,
because the growing “energy gap” is going to lead to a geopolitical rivalry
and an implosion of cooperation among the main players. He sees a strug-
gle among the major energy-consuming nations in the “new international
energy system” absorbed in a competitive struggle over some indispensa-
ble resources that are becoming more scarce. The focus is on the United
States as the most important player in a new geopolitical game, challenged
by new emerging players like China, Russia and India.
These power relations which are “(a)lready edgy and competitive (. . .)
hint at future scenarios of conflict among the so-called Great Powers of
a far more dangerous sort.” (Klare 2008, 21) In this “new international
energy order” governments – and not private corporations – would be
the main players and the subjects of geopolitics since governments have
increasingly lost confidence in private firms to acquire new oil and gas
properties in the last decade. Therefore, governments have to take on a
“commanding role” again by taking key strategic decisions leading to new
forms of “resource nationalism” (Klare 2008, 22–23). In a world which
is divided into energy surplus and energy deficit countries the latter are
striving to develop good relationships with the former. It is a logical conse-
quence that the fiercer the competition among the energy-deficit countries
over “what is left”, the more the competing states will feel compelled to
take recourse to means of military involvement with the key resource sup-
plying areas in particular in Africa and Central Asia:
As the scramble for vital resources intensifies, however, governments will

also become increasingly likely to employ more forceful means. In all prob-
ability, countries with major resource deposits will receive more weapons,
military training, technical assistance, and intelligence support from states
that wish to curry favor or establish closer ties. At the same time, combat
forces will be deployed abroad to defend friendly regimes and protect key

ports, pipelines, refineries, and other critical installations. (Klare 2012,

220–221)
Here Klare sees the cause for possible conflicts which might spin out of
control. As the key rival for the United States Klare points to China where
the competition includes all corners of the world where oil is being pro-
duced in big quantities: from the Gulf region over South America to the
Caspian to Africa, but in particular in Africa.
2.1 Critical Geopolitics
But like realism, the concept of “geopolitics” has also experienced cycles of
recognition and dismissal as a valuable analytical tool. With the emergence
of globalization in the 1980s and 1990s, theories with a focus on the role of
economics in international relations seemed to be more apt to explain the
new reality. Apart from mainstream theories which clustered around the
school of neo-liberalism, an interesting school called “critical geopolitics”
developed as an alternative method of analyzing geopolitics and global
change. Scholars of this approach recognized that “along with the chang-
ing ways in which the international political economy operates (new pat-
terns of flows, transfers and interactions) come new representations of the
division and patterning of global space.” (Agnew and Corbridge 1995, 7)
In this transforming world of the 1990s Agnew and Corbridge identified
a process of “deterritorialization” (Agnew and Corbridge 1995, 100) in
which “geography” and “territory” cannot be attributed any meaning and
in which “relative economic power has begun to displace military force
and conquest as an important feature of international relations.” (Agnew
and Corbridge 1995, 3)
For the purposes of our discussion, we use Gearóid Ó Tuathail’s and
John Agnew’s definition of “geopolitics” as a “discursive practice by
which intellectuals of statecraft ‘spatialize’ international politics in such
a way as to represent it as a ‘world’ characterized by particular types of
places, peoples and dramas.”3 For pursuing geopolitics these intellectuals
have to take recourse to a “geo-strategization” which Tuathail defines as
“the making of a discursive claim that a particular foreign policy crisis or
challenge has the locational and transcendent material national interest
qualities that make it ‘strategic’.” (Tuathail 2004, 96) This might apply to
conflict over a particular material resource or might have an impact on
consensual national security interests, but in any event an inventory of
these dimensions is constructed and represented as part of the material self
interest of the state” (Tuathail 2004, 96). This is at the core of our interest
in this analysis: to determine whether after a long phase of globalization

states are again refocusing their attention to spatialize international poli-

tics according to their national interests and “securitize” energy relations.
A geo-strategization is understood in this context as not excluding military
measures as part of a comprehensive concept.4
2.2 Energy Cycles and Corresponding Theoretical Views
Like “geopolitics”, “energy security” has experienced certain cyclical ups

and downs following oil price developments. In very broad terms, “energy
security” is defined as stable and secure supplies at affordable prices.
The attention of governments to energy security follows the fundamental
situation in the respective oil and gas markets: In the 1980s and 1990s,
thanks to a vigorous diversification strategy from the Middle East on
part of the OECD countries and later the dissolution of the Eastern Bloc
the precious resource oil was abundant again and available for very low
prices. Energy was starting to be seen as a “commodity” and no longer as
a trophy in a geopolitical great game. Consequently, energy was defined as
a commodity or a service (electricity).
Ups and downs in the supply situation are part of the raw materials’
market features: physical availability and consequently price develop-
ments are closely intertwined with the issue of appropriate and sufficient
investments. The raw materials investment cycle is characterized by the fact
that projects in the energy sector have remarkable lead times until they are
fully developed and on stream, e.g. the respective pipeline is being filled.
A cycle can unfold: price volatility and uncertainty discourage investment,
as a consequence producing country governments under-invest in produc-
tive capacity, a behavior that is constraining the capacity over time. With
the increase in demand, e.g. oil prices rise thereby resulting in a tightening
of the supply/demand balance. Both sides take actions: in the face of high
prices, consuming country governments take action to curb oil-demand
growth. Oil demand slows with a lag. At the same time the investment
rebounds in producing countries, boosting capacity with a lag. Together
this is leading to over-capacity and causing prices to fall back again (IEA
2010, 141) The (vicious) cycle starts again. These cyclic investment swings
are known as the “pig-cycle” and are reinforced by intransparent markets
and very limited price elasticity of both demand and supply.
After having being treated like a commodity for two decades with the
beginning of the 2000s energy seemed to be back on the agenda of politi-
cians (Yergin 2006). We saw prices skyrocketing and the ever alarming
term “peak oil” made it for the first time into mainstream analyses of oil
supply.5 The first articles appeared indicating that energy security would
be a very dominant subject again in the future, and back were articles

which interpreted “energy security” not as a matter which could be solved

by the “markets and institutions”, but rather by pursuing “geopolitics”
and “geo-strategy”. For those arguing in this line the Iraq War was telling
evidence of this new trend.
But, first we start with an analysis of the geopolitical implications of
today’s supply issues which are characterized by unprecedented risks and
uncertainties.
3 THE UNPRECEDENTED UNCERTAINTY AND

THE INTERNATIONAL LANDSCAPE OF SUPPLY
“Unprecedented uncertainty” (IEA 2010) is indeed the main feature of

today’s energy system, as put forward by the International Energy Agency
(IEA). This is equally true for the demand as well as for the supply side
on which we focus.6 Unprecedented uncertainty characterizes the present
energy system as the size of ultimately recoverable conventional and
unconventional reserves is a major source of uncertainty for the long-term
outlook (IEA 2010, 48). Equally unclear are demand developments in light
of the economic crises but also of possible fuel switching and substitution
effects.
A key issue for determining the quantity of reserves left is how progress
in technology is evaluated against geological fundamentals. The “Peak
Oil” discussion has raised public consciousness because hydrocarbons are
exhaustive and non-recoverable. Estimates differ widely about when oil
production has reached or will reach its plateau. The Association of Peak
Oil (ASPO) argues that the peak of oil production was reached somewhere
between 2005 and 2010; multinational companies are much more optimis-
tic. BP estimates, that the known reserves are able to cover the demand
for the next 40 years. Maugeri has predicted a new revolution in oil
supply capacities and even an “oil glut” based on “deconventionalization”
(Maugeri 2012). Other papers discuss the estimates on ultimately recover-
able resources and price elasticities of supply and demand by bringing
together the opposing approaches of geology and technology (Benes et
al. 2012). The new dreams of resource endowment are fuelled by thoughts
of unconventional resources. “Unexplored and untapped” areas such as
deep waters, the Arctic, East Siberia as well as oil sands, tight oil and
shale oil have contributed to increase the global reserve basis. However,
a clear definition for unconventional is lacking, but is meant for resources
that can only be exploited by new technologies and is unclear with respect
to economical recovery. Exploring (un)conventional oil seems more a
matter of costs and prices and of course is related to new environmental

risks. The above gives evidence that the time of cheap oil is over. And in
our geopolitical context, the most important message is that the use of
the unconventional hydrocarbon resources may change the landscape of
energy relations.
The conventional picture is one of growing concentration in few world
regions and in countries that are characterized by unstable and undemo-
cratic regimes. One of the main particularities of conventional fossil fuels
is their uneven global distribution: In the future, the world will have to rely
to an ever larger extent on the energy-abundant countries of the “strate-
gic ellipsis”: the geographical area stretching from Siberia to the Caspian
Basin, the Persian Gulf to the Arabian Peninsula. The region contains 63.5
per cent of global oil reserves, compared to a 47 per cent share in overall
production in 2009 (BP 2012, 6, 8). The future role of the Organization of
Petroleum Exporting Countries (OPEC) and the implications for security
of supply is among the geopolitical uncertainties. OPEC countries control
more than 76 per cent of global reserves and 63 per cent are located in the
Gulf region. The OECD disposes over only 6 per cent of global oil reserves
(BGR 2009, 37) and conventional oil production in the OECD area has
most likely achieved the plateau.
On a global scale the resource base of natural gas is abundant in com-
parison to those of oil. For gas, the share of conventional gas reserves in
the strategic ellipsis is even higher with more than 70 per cent, while the
bulk of almost 60 per cent is located in four countries: Russia, Qatar, Iran
and Turkmenistan. The countries of the strategic ellipsis also dominate
gas production with around 37.5 per cent (BP 2012, 20, 22). In a global
perspective, most of the reserves are conventional gas. The OECD share is
only about 10 per cent of the world total.
The Arab Spring is a case in point for the (geo)political impacts and
has caused widespread fears about the prospect of oil (and gas) supply
disruptions. Very closely related is the issue of internal reforms that may
go hand in hand with new depletion strategies, a revisiting of existing
Production Sharing Agreements, changes in the managements of National
Oil Companies etc. This in turn, may affect the business conditions for
IOCs and the access regime. Moreover, political and socio-economic
reforms may affect the volumes and direction of exports and there are
strong indications that necessary investment into new sites is on hold,
funds are redirected and domestic price reforms are reversed.
The uprisings in the Arab world that unfolded in 2010 and 2011 question
existing alliances. This is important from a geopolitical perspective and
indeed, the movements mark a watershed (Darbouche and Fattouh 2011,
1). The OECD world had long depended on autocratic regimes because
they seemed to provide stability. This proved to be an error: rather, it is

“stable societies(,) that hold the key to future reliance on MENA hydro-
carbons.” (Roberts 2011, 3) Regionally, there is an immediate risk of
contagion and changing balance of power. Iran and the Shiite minorities
in the Gulf countries are a source of concern. This is particularly sensitive
when it comes to the three countries of the Gulf Cooperation Council
(GCC): Saudi Arabia, United Arab Emirates and Kuwait. Saudi Arabia’s
strategic importance for world oil markets cannot be overstated. It is not
just the sheer size of its production and exports, but its spare capacities to
increase oil production at short notice. Saudi Arabia produces around 10
million barrels daily, and has another estimated 2.5 million barrel capac-
ity,7 which gives the Kingdom the opportunity to act as a balancing swing
producer. Even though the real potential has been questioned (Simmons
2005), there is no doubt about the relative market position: there is no
significant spare capacity outside the Gulf region. Moreover, the region
hosts some of the world’s famous chokepoints and transport arteries with
the Strait of Hormuz, through which 20 per cent of all globally traded oil
passes, the Bab-el Mandeb Strait, the Suez Canal and the Sumed pipeline.
What Saudi Arabia is for oil, Russia is for (conventional) gas. Russia has
been the dominant gas player in the world and has built its regional (read: in
the EU and the CIS) energy power on its pipeline network. Change is in the
air or is even taking place already. The dominating geopolitical theme has
been Europe’s (inter)dependency from Russian gas supplies. With respect
to diversification, the Caspian Basin with its vast, partly unexplored, and
untapped resources is one of the regions that could change the future
pattern of resource development and exports (IEA 2010, 523). Moreover,
the natural gas reserves in the MENA region represent some 45 per cent
of the world’s total reserves, its marketed production amounts to 20 per
cent of the world’s total output (Darbouche and Fattouh 2011, 21). Qatar
is the major player on the world’s LNG market. Another trend observable
in the landscape of supply or more precisely in supply and demand is the
steeply rising demand in energy producing countries. The gas consump-
tion in the MENA countries is a case in point with the growing indigenous
demand. Most countries of the region, with the exception of Qatar, have
faced supply shortages. Gas will be extensively used in the power sector:
the North African countries will see a quadrupling of their electricity con-
sumption till 2030, given annual growth rates of between 4 and 8 per cent.
It will also serve as a feed stock for energy-intensive industries, whilst at the
same time upstream production costs will increase as “easy gas resources”
are depleting. Gas consumption in the Middle East is expected to grow by
3.9 per cent per annum between 2010 and 2030 (BP 2011, 51). The rising
internal demand will most likely affect the disposable export volumes and
constrain the region’s export capabilities.

Rising gas demand and antagonistic relations between neighboring

countries are a threat to regional stability. After the Egyptian revolution in
February 2011, the gas export contracts of the country with Israel and its
other neighbors have been constantly questioned, and the pipeline through
the Sinai has been blown up several times. This is a source of geopolitical
instability in the region, as Israel gets 40 per cent of its imports from
Egypt. The country will be forced to exploit disputed off-shore resources
in the Eastern Mediterranean Sea. The Levant Basin has witnessed the
world’s largest deepwater gas discoveries in 2009 and 2010. This may lead
to conflict between Israel, the Palestinian Authorities and the Lebanon.
Moreover, these vast reserves have increasingly been a source of dispute
between Cyprus and Turkey in 2011 (Popvici 2011).
The dominance of few exporters and the concentration of the con-
ventional gas reserves have raised concerns over the creation of the Gas
Exporting Countries Forum (GECF). Pipeline-dominated gas exports
and the existence of oil price indexed contracts have since its creation been
seen as hindering the formation of a cartel. However, since spot market
transactions in Europe and global Liquefied Natural Gas (LNG) trade
has increased, the room for maneuver for gas exporting countries to steer
export volumes and directions has enlarged. As in OPEC, an effective
cartelization is constrained by diverging (geo)political and commercial
interests of the members. Nevertheless, the developments are a source of
concern which consumer states should keep an eye on.
The shale gas revolution in the US has fundamentally changed the
gas markets. Whether this boom can be reproduced in other parts of
the world, namely in (Eastern) Europe and China is uncertain, though.
The steep increase in shale gas production in the US resulted in a remark-
able fall of LNG imports to the US. This LNG was then exported
to Europe, helping to increase the liquidity of its gas hubs and spot
markets significantly. The gas glut also unfolded because the economic
crisis in 2008/2009 resulted in decreasing demand. Gas prices eroded in
Continental Europe and consumers were able to buy gas at a much lower
price than under the Long Term Contracts with its major Norwegian and
Russian suppliers. As a consequence of these latest developments, the
gas markets are in flux with respect to the marketing areas, the different
price regimes and the relevant actors (Westphal 2012, 2013). At the time
of writing three (or even four) regional gas markets exist with very differ-
ent price levels. LNG trade has not led – as expected less than a decade
ago – to a globalized gas market and converging prices. In the North
American market, gas prices are very low due to the shale gas revolution.
In the European market the price is more than three times higher than in
North America, but still much lower than in the Asian-Pacific market.

Also the pricing mechanisms differ. South America is the fourth region
but on a nascent stage.
The above described geopolitics around hydrocarbons will certainly
change with a transformation toward a more sustainable energy system.
Yet, a more renewable energy based system will not be free of geopolitics,8
because it shapes future regions through interconnecting infrastructure
and new (inter)dependencies. Moreover, inter-and transnational coopera-
tion is a key condition for the expansion of renewable energy and devel-
oping green electricity markets as reflected in the Seatec concept of large
off-shore wind parks in the North Sea or envisioned in the Desert power
concept linking the EU with the MENA region. Moreover, the case of bio-
fuels or hydropower is closely related to the water and food usage. Energy
is part of the water-energy-food nexus which itself displays the linkages
between territory, access to resources, usage and distribution.
The unknown level and the future structure of energy demand is
another uncertainty. However, the preconditions are very different around
the world: the industrialized countries have almost reached their peak in
energy consumption, but the emerging countries and the developing coun-
tries have to cope with a (sharp) increase in demand. This can be described
as the global energy dilemmas (Bradshaw 2010) that complicate the search
for new global energy solutions at a time when we observe a general retreat
of globalization.
4 RETREAT OF GLOBALIZATION – EFFECTS ON

ENERGY SECTOR
The following section will try to shed light on certain trends that provide
evidence for a “retreat of globalization”.
The energy world will soon become much more differentiated in terms of
energy production, consumption paths and the landscape of actors. Major
uncertainty relates to the different development paths and their effective
implementation. Depending on the locational prerequisites needed for
renewable energies, storage facilities etc., the energy production and con-
sumption map will become much more diversified being tailored to local
circumstances. Moreover, oil, gas and coal will likely each share a third of
the hydrocarbon energy mix. This brings about many uncertainties with
respect to the development of costs and winning technologies.
A retreat of globalization also occurred as oil (and even indirectly
gas and coal) markets became global because of the price mechanism.
However, this has always been less true for the physical flow of oil. The
recent price developments as seen in the remarkable gap between West

Texas Intermediate Oil and Brent Oil prices are illustrative. The US has
managed to become increasingly independent from the MENA region.
Europe has proved to be much more vulnerable, in particular from trade
disruptions in North Africa. Yet, the bulk of GCC crude oil exports go
to the Asia-Pacific region.9 What do the physical oil trade flows tell us?
In the future, the North American oil markets may become less intercon-
nected depending on the amount of deep water off shore exploration
in the Mexican Gulf, unconventional (shale) oil production in the US
and Canada, and the prospected off-shore production in Brazil. The US
and the North American market have taken significant steps to become
largely self-suppliers. The US has become a self supplier, most likely also
with (shale and offshore) oil. This may have geopolitical implications as
it results in less immediate interest in the Middle East. This may result
geopolitically in a more isolationist attitude towards issues of supply secu-
rity, in particular with regard to securing oil and LNG flows through the
major chokepoints. More than 40 per cent of global oil exports originate
in the Gulf Region. One-third of all sea-based oil trade transits through
the Strait of Hormuz. The revolution in Egypt in February 2011 has raised
concerns over the SUMED pipeline and the Suez Channel through which
the LNG exports from Qatar to Europe cross. Will Europe and China
step in? Also as yet unknown is how China as a major consumer of oil and
gas flows from the Middle East will behave as “Ordnungsmacht”. So far,
consumer countries’ cooperation is limited by the institutional landscape
of international governance. Neither China nor India are members of the
IEA. However, it is common sense that it will be the emerging consuming
countries that will make the difference.
Another question is whether the US will become a gas exporter and
challenge Russia in that respect. It has already overtaken the Cold War
antagonist in production. If the two clash on market shares in the energy
trade that could mean a qualitatively new situation with regard to already
sensitive international energy relations. Whether Europe will still see an
increased availability of LNG (redirected from the US) depends on the
level of demand increase in the Pacific region. For Europe, the major chal-
lenges to be faced are the strategic partnership with Russia to be developed
further and the energy relationship with China. Both regions are looking
to the same resources in the Caspian region and in Central Asia.
Second, the cyclical development of oil prices has implications for the
national governance of access, use and distribution of hydrocarbons, and
subsequently for the redistribution of rents. Oil prices are the lead currency
for most of the other raw materials. Oil prices are the major reference
point for investment into oil exploration, production and infrastructure,
and they are the major incentive to reduce oil consumption. Moreover,

they determine the income to the state budget of oil producing states. Last
but not least, oil prices are set in a complex interplay of the market funda-
mentals, market expectations and financial transactions and speculation.
Third, with respect to globalization in retreat is “resource nationalism”
and the renationalization and creation of national oil companies (NOCs). At
the beginning of the 2000s, when a steep increase in demand drove oil prices
to record levels, many oil (and gas) producing states took a more assertive
stance towards foreign investments in these strategic sectors. In particular,
the policies of Russia and Kazakhstan to reconsolidate the state’s (read: the
elites’) grab and control over resources has deeply shaken up the market. It
was the dissolution of the Soviet Union, the new volumes of Russian (priva-
tized) oil companies and the prospect for new super/giant fields that fuelled
the dreams of the International Oil Companies (IOCs) but also resulted
in plummeting oil prices. By that time, also under the neo-liberal market
paradigm Western consuming countries and their IOCs achieved significant
inroads into energy-abundant countries (Mommer 2002).
In the early 2000s, Russia and Kazakhstan alarmed energy investors: re-
nationalization and wide scale corruption challenged fundamental rights
guaranteed under production-sharing-agreements. The empirical bases for
Friedman’s first law of petropolitics stating that the price of oil and the
pace of freedom move in the opposite direction (Friedman 2006) unfolded.
Whereas the 1990s witnessed a phase of significant inroads into producing
countries, in the early 2000s the pendulum swung back. Re-nationalization
of the oil industry or at least of its core parts (as exemplified by the Yukos oil
company in Russia that was taken over by state company Rosneft after the
arrest of the Yukos’ CEO Khodorkovsky) significantly changed the business
environment for the multinational oil companies, who were the major instru-
ments for OECD countries to secure timely, stable and affordable supply.
Nowadays, it is the National Oil and Gas companies (NOC) that control
over 80 per cent of the reserves (BGR 2009, 37). NOCs are subjected to
political considerations and serve as a major instrument for the ruling elites
to stay in power. “Resource nationalism” results in limited access for IOCs.
However, the motivation behind the waves of renationalization in
the former Soviet Union and Latin America are different. But high oil
prices have enabled these steps. When the oil price increased money was
soaring into state budgets and enlarged the room for maneuver. Latin
America, Ecuador and Bolivia for instance took the opportunity to revise
and change unfavorable deals that had been agreed upon under different
circumstances. Moreover, disputes among the old elite and leftist socialist/
indigenous movements over the redistribution of rents drove renationaliza-
tion in Latin America (Venezuela, Bolivia, Ecuador) as did diverging inter-
ests over depletion and exploitation strategies as in the case of Argentina.

For the OECD and its multinational oil (and gas) companies the time
of cheap and easily accessible conventional oil is over. Because of restric-
tive policies in many energy-abundant states, but also because of deple-
tion paths in the OECD world, the IOCs have to go to geologically and
geographically ever more challenging areas. All this together, is driving
oil (and energy) prices. The costs escalation is remarkable: in the 1990s,
the costs for an oil field development from exploration until the start of
production lay between US$500 million and US$1 billion; nowadays this
amounts to US$5–10 billion (Oldag 2011).
As a result of renationalization and state intervention we have seen
fragmented markets developing. Whereas the EU has followed a path of
markets, competition and integration based on clear rules and regulation
to provide for a level playing field, other countries have gone in the oppo-
site direction following a “regions and empires approach” (Clingendael
International Energy Programme 2004).10
Last but not least, it has to be emphasized that oil price developments
have not only been a source of conflict but have also driven remarkable
achievements in international governance. When it comes to dealing with
the well-known pig-cycles in raw materials and the shift in the supply and
demand balances, 2008 has been a watershed that has brought energy gov-
ernance further but not far enough: the peak in prices of about US$147 per
barrel (Brent) and the price decrease by almost US$100 per barrel in less
than six months raised the consciousness for mutual vulnerability. Both
consumers and producers are exposed to the damage volatile prices can
cause. Oil price levels and oil price volatility have been a constant source
of concern for all relevant actors and have resulted in new or reinforced
international governance initiatives such as the Joint Organisation Data
Initiative (JODI) of the International Energy Forum. JODI has been
built up as a major initiative to step up dialogue and cooperation between
consuming and producing countries. The year 2008 has been a watershed
for cooperation in the IEF because the decrease of oil prices by almost
US$100 per barrel proved to be equally damaging to producing and con-
suming countries. Since then, the world has witnessed intents to improve
transparency on the oil markets as well as in the financial markets, both
under the umbrella of the IEF as well as under the roof of the G20.
5 CONTROVERSIAL VIEWS ABOUT THE CAUSES

OF AN UNSTABLE “ENERGY SECURITY”
Thus, as has been shown above, the more recent conversation about
energy security has evinced consensus among researchers and analysts that

supply is no longer being guaranteed for the unforeseeable future. Import

dependency of major consumer countries will grow – though for the
mid-term future, the United States will be exempted from this competition.
As early as 2004 the Clingendael “Study on Energy Supply Security and
Geopolitics” concluded that energy will become a determining factor for
international relations in the future and that “energy relations will become
increasingly politicized” (Clingendael International Energy Programme
2004, 16). While gas and also renewable energy have some implications
for energy security, there is also consensus that oil dominates the concern
about energy security, that “(o)il plays a strategic role in both economic
and social development and is one the greatest sources of world power”
(Palazuelos 2012, 301). And, moreover, the question of oil will also deter-
mine whether we will see “cooperation (or conflict) in international rela-
tions” (Palazuelos 2012, 301). But that is where the consensus stops. As
already evident from the discussion above, there are controversial views of
the causes of this unstable situation, but they have different explanatory
analytical power if applied to particular regions and case studies.
Michael T. Klare’s analysis of “Great Power Games” makes sense for
two conflict areas, one of which threatens to result in open military con-
flict in the near future: the conflict over the East and South China Seas; the
other is over the oil in the Arctic.11 It is these areas where exploration and
production open new frontiers, and where borders are unclear or disputed.
5.1 Great Power Game in the East and South China Seas
Three conflict lines are identifiable here: between China and the US,
China and Japan and China and its neighbors to the South and East.
All this reflects the territorially disputed areas of the East and South
China Seas, the Gulf of Thailand and the waters surrounding Indonesia.
The Obama Administration’s “pivot” from the Middle East to the
Asian-Pacific region has to be seen in this context, manifesting itself by
sending US Marines to Australia, combat ships to Singapore, the opening
of a naval base in the Philippines and the redeployment of an aircraft
carrier into the South China Sea12 –leading Klare to suggest that “after
a decade-long-hiatus-cum-debacle on the Eurasian continent, the Great
Game v. China is back on”.13
It is obvious that several Southeast Asian countries have deepened their
military ties with the US and Japan in response to the Chinese build up of
its naval capabilities over the last 15 years and China’s public announce-
ment in 2010 that its South China Sea claims were “among its ‘core inter-
ests’” (Chang 2012, 21). These military deployments to this region can
certainly not directly be linked only and exclusively to energy, since the

issue is also about securing the Straits of Malacca against piracy and the
terror of Islamic groups (Favennec 2011, 129).
But, in general, they can be understood as a commitment by the US to
support its allies in the region. According to Klare “(b)ecause so many
countries have advanced overlapping claims to all or part of these mari-
time regions – China, Japan, and Taiwan in the East China Sea; Brunei,
China, Malaysia, the Philippines, Taiwan, and Vietnam in the South
China Sea – it has proven nearly impossible to establish definitive offshore
boundaries . . .” (Klare 2012, 67). The summer and fall of 2012 saw a con-
flict heating up between Japan and China over the Senkaku islands.14 As
Japan’s ally, the US would be expected to come to her help, but so far the
US has remained silent. Nor are there any regional organizations in place
to mitigate any conflicts, hence Klare’s analysis seems legitimate.
5.2 Russia’s Hegemonic Policy in the Caspian Sea Basin and Central

Asia
Even more than the East and South China Seas, it is Central Asia and the
Caspian region which are generally regarded as the quintessential locus
of inter-imperial rivalry15 and for Klare they are even the “cockpit for a
twenty-first-century energy version of the imperial ‘Great Game’ of the
nineteenth century” (Klare 2008,115). But according to our analysis the
picture is more of a mixed bag. A militarized “geo-strategization” is not
identifiable in the case of Russia’s policy in the Caspian, rather a policy
of a former hegemon that has tried to preserve its geopolitical influence in
the “near abroad” and has aimed to monopolize the gas flows to Europe,
thereby exerting influence on the Caspian Basin energy sector. Yet, this
strategy has faced limitations by the United States and China.
The region is landlocked, which forms a decisive barrier to the devel-
opment of the vast resources, notably because of the complexities of
financing and constructing pipelines across several countries. Alternative
pipelines that bypass Russian territory had to be built. This constitutes
long-term relations. In the Caspian Sea Basin and in Central Asia geopoli-
tics and geo-economics are at play amongst those territorial disputes, such
as the Russia-Georgia conflict in August 2008, the unclear legal status
of the Caspian Sea, policy reversals as regards depletion strategies, and
upstream access, export routes and domestic energy use. Political risk in
the region is considered high and these perceptions have preempted larger
export projects. With the dissolution of the Soviet Union, and most visibly
illustrated in Ukrainian-Russian gas disputes of 2006 and 2009, transit
became one, if not the security of supply issue for Europe.
Russia’s priority from the very beginning has been to maintain the

monopoly for oil and gas flows from the region, and to trade and re-sell
these hydrocarbons with high windfall profits. Transit issues have been
prominently addressed in the Energy Charter Treaty (ECT) and its related
Transit Protocol (Westphal 2011a). For that reason, Russia had never
ratified the ECT as it stepped in as a trader of Central Asian gas and was
not willing to offer free transit. The Russian gas company Gazprom feared
the loss of its strategically important position as the narrow gateway to
Central Asian gas. The decisive point here is that Gazprom has bought
and resold Central Asian gas instead of simply providing transit serv-
ices. Russia has put Turkmenistan in a position of a swing gas supplier,
exposing the country twice to two sharp collapses in deliveries to Russia
because of disputes over prices and volumes (1997–1998 and 2009). It has
also instrumentalized the uncertain legal status of the Caspian Sea as well
as the other littoral states for their own interest. This unclear legal status
has so far prevented a Trans-Caspian pipeline and large scale off-shore
projects of Turkmenistan. Russia has made significant windfall profits
over the past 20 years in re-selling Central Asian gas. And more than that,
it has pressured Kazakhstan and Turkmenistan into the situation of swing
suppliers: with the falling gas demand in Europe, Russia passed the loss in
volumes down to the Central Asian producers.
The US strategy of getting a hold in the Caspian energy sector was the
set up of a pipeline system that allows for a substitute export route for
West Caspian oil that does not pass through Russian territory, the Baku-
Tbilisi-Ceyhan pipeline. Operational since 2006 this pipeline transports
the oil directly from Baku in Azerbaijan to Ceyhan in Turkey.16 In addi-
tion, China started to tap into the Caspian resources since Central Asia’s
oil can be directly delivered to China by land and domestic pipelines, thus
the vulnerability of the oil and gas’s transportation can be curbed (Klare
2008,133–135).
The export option to China is strategically of the utmost importance for
the real independence of Kazakhstan and Turkmenistan from Moscow,
and the Chinese presence has almost put an end to Russian dominance in
price negotiations and play of volumes China is investing predominantly
in Kazakhstan and Turkmenistan in oil and gas pipeline systems and
upstream projects. With the commissioning of the Turkmenistan – China
pipeline gas export has started to diversify.
For the EU, that has repeatedly claimed to diversify its imports, it seems
very likely that gas exports from Shah Deniz Phase II will find its way
through a Southern Corridor into Europe. This might not necessarily be
realized through the Nabucco Pipeline but rather with a smaller project
that is being developed first, and with the possibility of being upgraded
later. In any case, however, these long, overland and multi-country

projects make the reliability of exports contingent on a long chain of

political arrangements, frameworks and circumstances.
5.3 US Hegemony by a Militarized Globalization Strategy
In contrast to Klare’s analysis of the “great power game”, Doug Stokes

and Sam Raphael argue – on the basis of neo-Gramscian theories – that
the United States strives for global power and hegemony over the world’s
oil rich regions by coercing them to open up their oil wealth to a “free
marketization” (Stokes and Raphael, 2010, 2).
But unlike Klare they interpret the hegemonic policy of the US govern-
ment in the international oil system not as a result of US “resource nation-
alism”, but rather as motivated by the intent to maintain a functioning
global economic system based on free trade of oil from which all states,
including non-Western ones, should profit. This capability on part of the
US to control the conditions under which all core powers receive their
oil from the South again contributes to the hegemonic power of the US.
Throughout the world, the US secures control of the global oil supplies
primarily through “transnationalizing” the elite of these oil rich countries
of the South by buttressing their power through a strategy of “military
coercion”. Thus these coercive and military deployments in the “Global
South” are not intended to threaten the big rivals, China and Russia, in
these regions, but rather against the impoverished population in the oil
rich areas who might demand a fair share of the oil wealth produced by
their authoritarian governments. Since Stokes and Raphael believe that
“rival centers of power opt primarily to work under the American strate-
gic umbrella” their conclusion is distinct from that of Klare in that “overt
competition for the world’s oil stocks will continue to be overwhelmingly
pacified” (Stokes and Raphael 2010, 51).
The Iraq war is also interpreted by Stokes and Raphael as the begin-
ning of neo-liberalism in the Gulf region with IOCs starting to have a
greater role to play. Thus by taking recourse to Robinson they argue
that the US invasion cannot be interpreted as a “‘US imperialist plan to
gain the upper hand over French, German, and Russian competition’ by
monopolizing Iraq’s crucial oil reserves”,17 but rather as an opening up
to the “investment by global capital” (Stokes and Raphel 2010, 96). If we
look at the result of the Iraq War, Stokes and Raphael seem to be right.
Only two US companies gained a big share of the bid (ExxonMobil and
California’s Occidental Petroleum). Also five OECD, but non-US, com-
panies (British BP, Dutch/British Shell, Italian ENI, Norwegian Statoil
and the Korea Gas Corporation) became involved in Iraqi oil, but large
shares of the attractive Iraqi energy sector also went to Chinese, Russian,

Malaysian and Angolan companies.18 The United States’ tacit approval of

Chinese and Russian companies’ involvement supports strongly the thesis
of the neo-Gramscian camp that the US interest was to bring the oil to
the international market, and in the long run will profit from having re-
strengthened its control of the international energy market.
6 CONCLUSION: REVISITING THE GEOPOLITICAL

PARADIGM
It is impossible to deny that oil, given newly emerging energy insecurities,

can (no longer) be purely seen as a “commodity”. Too many voices have
warned that oil is getting scarce, from CEOs of big oil companies to the
IEA, though with different levels of urgency. How you frame it depends
on the lens you are looking through. But with the return of energy security,
traditional geopolitical interpretations are very much in vogue and “sexy”
again. Among all players analyzed here only China with its authoritarian
governmental system might oblige the US to come to the support of its
allies in the instable region of the East and South China seas.
But, while “China’s resource undertaking is global and among the most
aggressive in history” (Moyo 2012, 3), it can still be interpreted as using
“soft power”19 in its global search for control of energy – as long as the
search is not in its own neighborhood.20 As for Russia it “only” strives to
maintain hegemony over the former Soviet republics and Eastern Europe.
More importantly in energy terms it is a fact that this strategy has fallen
together with the economically and commercially driven pursuit to pre-
serve, retain or expand its market shares in the respective region. There are
also no signs of a “geo-strategization” to achieve its goal.
In general, these geopolitical narratives tend to ignore developments in
exploration and production of unconventional resources. Moreover, they
perceive the state as the main device and blind out the economic and cor-
porate interests of private companies. Most importantly, the most prob-
able possibility that the resource game is fought via pricing of fossil fuels is
more or less ignored. The geopolitical storyline is about access, and tends
to ignore the “rest” of the supply chain. Theoretical concepts inspired by
institutional economics (North 1990) focus on other levels e.g. substate,
transnational etc. and on other actors, such as companies. The analysis
directs toward corporate strategies, price mechanisms and interdepend-
encies. These theories help to understand that the energy supply chain
in most cases stretches across borders: from the production (upstream),
to transport and trade (midstream) to downstream (processing, retailing
and marketing), sometimes this production chain is vertically-integrated,

in most cases it is not. Consequently, the analytical focus was not only
on the supply side, but also on the demand side. Energy security is not
only defined as supply security, but further takes into account interde-
pendencies, vulnerability and sensitivity (Keohane and Nye 2001). Thus,
resilience of a system plays a major role.
Apart from some select deviating views21 there still seems to be consen-
sus among analysts that it is the European Union which is epitomizing
the “markets and institutions”22 approach since it is very much embedded
in the spirit of globalization and neo-liberalism, trusting exclusively the
forces of the market and its institutions to provide energy security for
its region. But with the US shale gas and oil revolution in full swing, it
remains to be seen to what extent there will be an awakening among EU
politicians that from now on they might themselves have to take care of
the region’s “energy security”. As for the US we learnt that its “intellectu-
als of statecraft” pursue a three-pillar strategy: while pursuing autarky
based on with their domestic shale gas and oil revolution, they are at
the same time preserving its strategy of globalizing the international oil
market without renouncing on a geo-strategization which takes recourse
to military means if necessary. Since even with a scenario of autarky the
US needs to watch global oil prices, the Europeans might be lucky and
might not experience a situation in which they find themselves bewildered
in front of a folded US “strategic umbrella”. Future research will have
to analyze the implications and consequences of this new configura-
tion in the new international energy system, in particular the effects on
transatlantic relations.
NOTES
1. One prominent figure of the US inner circles who confirmed this kind of interpretation
was Alan Greenspan, Former Chairman of the US Federal Reserve Bank, see Peter
Beaumont and Joanna Walters, “Greenspan admits Iraq was about oil, as deaths put at
1.2m”, The Observer, 16 September 2007.
2. For the German case Klinke observes that the “debate is based on an unhelpful binary:
the life or death of geopolitics”, 2011, p. 709.
3. Tuathail (2004, 93), quoting from Tuathail and Agnew (1992), “Geopolitics and
Discourse: Practical Geopolitical Reasoning and American Foreign Policy”, Political
Geography, 11: 190–204.
4. See also Peters (1999, 30–31).
5. See Moran and Russell (2009), who claim that “(t)he idea of peak oil is already
becoming established as a subtext or unspoken assumption among strategists and
policy-makers”, 4. For a detailed discussion of “peak oil” see Peters (2004).
6. See in more detail Westphal (2011b).
7. Own calculations based on EIA (2011) and BP (2012, 8).
8. See for example Smith Stegen (2012).
9. For Saudi-Arabia the figures are as follows: 57 per cent of the crude oil exports go to

the Far East and 50 per cent of the refined product exports, too (Energy Information
Administration 2011, 6).
10. See the 2004 Clingendael study which distinguishes between the “regions and
empires” and “markets and institutions” approach (Clingendael International Energy
Programme 2004, 84).
11. See the chapter on the Arctic in Klare (2012, 70–99).
12. Spiegel online, 17 October 2012.
13. Klare, Michael (2012), “Oil Wars on the Horizon”, at TomDispatch.com, accessed at 19
September 2012.
14. Economist, 22 September 2012.
15. See also Kleveman (2003).
16. See Klare (2008, 125) and Favennec (2011, 160).
17. Robinson, William (2004), A Theory of Global Capitalism: Production, Class and State
in a Transnational World, Baltimore, MD: John Hopkins University Press, p. 140,
quoted in Stokes and Raphael (2010, 96–97).
18. Aljazeera, “Western Oil Firms remain as US exits Iraq”, 7 January 2012. For a more
detailed analysis of the Iraq oil sector see Kadhim (2012).
19. Kinchen, David (2012), “Book Review: ‘Winner Take All’: China uses ‘Soft Power’ to
Gain Control of Mineral Resources, Other Valuable Commodities”, HuffingtonNews.
Net, 26 June.
20. For a balanced analysis see also Downs (2010).
21. For a contrary view, see Bosse (2011).
22. The 2004 Clingendael study sees the EU firmly embedded in the “markets and institu-
tions” approach. See also McGowan (2011) who argues that the “debates and actions
of European policy makers are better understood as being played out in a framework
of politicization rather than securitization”, p. 488.
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Comments C12, March.

PART III
SECURITY OF ENERGY
SUPPLY

6. Securing energy supply: strategic reserves
Elspeth Thomson and Augustin Boey
INTRODUCTION
Strategic Energy Reserves (SERs) are meant to help safeguard a country’s

economic growth and provide a buffer to external price/supply turbulence.
They are intended to dampen domestic price volatility following an energy
supply/price shock and concomitant financial losses incurred as a result
of production stoppages and/or the necessity of making short-term pur-
chases of energy commodities (typically oil, oil products, natural gas or
coal) from the spot market.
Energy supply/price shocks can be extremely harmful to developed and
developing economies alike, potentially disrupting all sectors and exacer-
bating existing weaknesses in economic structures. They can cause GDP to
plummet and also trigger inflation and unemployment.
However, not all people believe that creating and maintaining strategic
energy reserves (SERs) is useful. Some believe there is little point in having
them because they are costly to build and maintain, and if a supply/price
shock is not resolved within a short period of time, the stockpiling is for
naught. Moreover, many regard energy supplies as fungible commodities.
While the advantages and disadvantages of strategic petroleum reserves
(SPRs) have been discussed by governments around the world for some 40
years, recently, governments have also been considering the pros and cons
of maintaining reserves of other forms of energy, hence, SERs, namely gas
and coal. Perhaps in future, governments may also examine the possibility
of maintaining reserves of biomass used in both electricity generation and
transport fuel production.
RATIONALE FOR AND OPERATION OF SERs

Besides discouraging the use of energy supplies as a political weapon,
SERs also provide a number of other benefits for stockpiling states.
Firstly, private sector energy corporations typically do not have suffi-
cient economic incentive to maintain energy stocks beyond levels that are
operationally optimal. The operational stocks cannot provide a sufficient
supply buffer in the event of a supply disruption (Strait, 2009). Thus, in
117

this respect, SERs can be viewed as public goods as they enhance the
energy security and economic resilience of a state. SERs also give stockpil-
ing countries the ability to buy time and to hold off more drastic measures
whilst pursuing diplomatic solutions and other policy measures in the
event of an energy supply shock (Yergin, 2006).
Secondly, though SERs cannot completely mitigate the price spikes and
other economic impacts associated with an energy supply or price shock,
releasing stocks can soften potential macroeconomic impacts, calm energy
markets and prevent panic buying. The reserves are especially crucial for
countries that have little in the way of domestic energy resources, i.e., they
are forced to import most of their energy requirements and are unavoid-
ably extremely vulnerable to any change in international energy markets.
SERs help ensure that there are adequate supplies in the short term,
and that the market price of these energy reserves remains the same or
stabilises during price increases.
THE HISTORY AND EVOLUTION OF STRATEGIC

ENERGY RESERVES
The events surrounding the Yom Kippur War in 1973 were the catalyst
for the establishment of the International Energy Agency (IEA) in 1974.1
In response to the United States’ support of the Israeli military, exports
of oil to the United States were embargoed by the Organization of Arab
Exporting Countries (OAPEC) in October 1973. Oil prices to America’s
West European allies were raised by 70 per cent. This led to severe supply
shortages and caused the price of crude oil to soar. The key specific goal
behind the IEA’s establishing the Strategic Petroleum Reserves (SPRs)
was ‘to help countries co-ordinate a collective response to major disrup-
tions in oil supply through the release of emergency oil stocks to the
markets.’2
The use of petroleum as a political ‘weapon’ during what came to be
known as the ‘first oil crisis’ was a turning point in governments’ energy
security planning and the objectives of energy security came to be com-
monly defined as ‘assuring adequate, reliable supplies of energy at reason-
able prices and in ways that do not jeopardize major national values and
objectives’ (Yergin, 1988). Following the first oil crisis and a second in
1979,3 a number of energy security-related initiatives were set in motion to
boost the resilience of national energy systems and, by the same token, to
prevent or mitigate the impacts of energy supply and price shocks. Energy
supplies and prices at any given time are a function of a combination of
political, economic, social, military, transport and geological factors. A

Securing energy supply 119
supply/price ‘shock’ can occur as a result of loss in equilibrium by any one

or combination of these factors.
The cost of building and maintaining these reserves is seen as being
justified against the far greater economic and political costs of an oil crisis
(Paik et al., 1999). SPRs are believed to serve an important function in
the strategic capacity and short-term energy security and economic health
of stockpiling nations. It must be emphasised, however, that they consti-
tute but one part of a comprehensive suite of short-term and longer-term
energy security measures. The requirements for ensuring a country’s
energy security are context-dependent and the various component policies
and measures, including SPRs, vary in importance across countries.
SPRs are typically in the form of crude oil due to the lower overall
costs of acquisition, storage and transportation (East-West Center, 2005).
However, some are in the form of refined products.4 They can be held
either by the government, private companies, stockholding agencies or a
mix of these. The calculation of a country’s total SPR stocks can include
oil or refined products held in operation, distribution or transport,
namely, in tankers or pipelines en route to refineries or consumers. When
and how a country’s SPRs are released is typically debated and enacted by
the highest level of government.
OECD (IEA) COUNTRY SPRs
Net oil importing countries within the IEA are legally obliged under
the International Energy Programme (IEP) to hold emergency oil
reserves equivalent to 90 days of the prior year’s net imports. This obliga-
tion was enacted in an attempt to balance the OECD grouping against
the oil-producing OPEC countries’ power to cause serious economic
harm. Canada, Denmark, Norway and the United Kingdom are exempt
from this requirement as they are net oil exporting members. However,
Denmark and the United Kingdom are required to hold stocks under
consumption-based European Union regulations. About two-thirds of the
IEA’s strategic oil stocks are held by the oil industry. The IEP also pro-
vides a framework for rapid response and decision-making in the event of
oil supply disruptions. It is supplemented by the Co-ordinated Emergency
Response Measures (CERM), which are an additional set of measures
established in 1984 that may come into force in the event of an oil supply
disruption that is too small to trigger the IEP emergency measures.
The IEA member states currently together hold around 1.5 billion
barrels of oil in their strategic reserves and around 4.1 billion barrels of oil
stocks in total.

The United States has the largest SPR, which in March 2012 held
about 695 million barrels. This represented around 45 per cent of the
total volume of the IEA’s member states’ SPRs. The United States’
SPR will be expanded to 1 billion barrels of crude oil under the require-
ments of the Energy Policy Act of 2005. The second largest SPR belongs
to Japan, which holds around 320 million barrels. Germany has the
third largest SPR with approximately 180 million barrels. Japan and
Germany together hold about 40 per cent of the IEA member states’
SPRs. The USA’s SPRs are almost entirely in the form of crude oil,
with the exception of a much smaller heating oil reserve. The formal
agreement to build them took place in December 1975, but filling them
did not begin until 1977. They were controversial right from the start.
Some observers feared soil contamination and other environmental
implications in the immediate area, as well as high construction and
maintenance costs.
The US’s reserves are contained in subterranean salt domes, thou-
sands of feet underground, at four locations along the Gulf of Mexico.
These natural caverns are by far the least costly and most secure types of
storage.5 Within the various countries, SPRs are held in different types
of storage sites. Other stockpiling methods include aboveground storage
tanks, partially buried storage and offshore floating platforms. These are,
of course, much more vulnerable to terrorist attack.
Most IEA member governments offer various forms of financial
support to oil companies holding stocks which could be instantly released
when given the decree. Some impose a penalty on oil companies that
default on their stockholding requirements.
The Release of OECD Reserves
As noted, the SPRs in the United States have been controversial right
from the start. Whenever there is some event, either a natural disaster or a
large-scale war effort, the pundits always debate vigorously about whether
or not to release some of the reserves. Some argue that the SPRs are meant
strictly for US war efforts (either on US soil or abroad), while others
contend they should be used exclusively to buffer the economic impacts
of high prices. The latter group also justify this stance by saying that a
recession in the US could easily cause other countries, indeed the world
economy, to slide into recession.
To date, the IEA has released oil stocks from its member states’ SPRs
three times: during the 1991 Gulf War,6 in the aftermath of the 2005
Hurricanes Katrina and Rita (Yergin, 2006) and in 2011 during the
Libyan revolution.7

SPRs Held by Non-OECD Countries
Though the IEA/OECD member countries have the most developed SER
programme, several other countries have demonstrated interest in devel-
oping their own strategic energy reserves. Most of these are still in the
planning and capacity-building stage. Of note are the measures taken by
various rapidly developing Asian economies which must import rapidly
increasing quantities of oil in tandem with their economic growth (Paik et
al., 1999; Downs, 2004). These governments are offering similar economic
incentives as the IEA member countries to maintain SPRs designed to
avoid the economic impacts of higher expenditures on oil imports and
the loss of GDP during oil shocks. The need for SPRs as an emergency
measure is likely to increase as Asian economies become more vulnerable
to oil shocks due to their increasing reliance on the politically unstable
Middle East for oil, the reduction in spare stocks and spare production
capacity in the private sector, increasing oil flows through potential oil
transit chokepoints and the short-run price inelasticity of oil (East-West
Center, 2005; Paik et al., 1999).
The IEA posts data on its website indicating its member states’ SPR
stocks. However, most other countries do not publish this information.
They are not required to report their SPR stockpiles and are far less
transparent with respect to their SPR programmes. The specific types,
volumes and locations of strategic energy reserves are considered a matter
of national security and are typically not fully disclosed. When non-IEA
countries make announcements about current or planned additions to
their SPR capacities, the actual scale of the reserves is open to inference as
SPR capacity does not usually indicate base stock levels.
China
China is currently building the largest SPR outside of the OECD. It has
had three phases of oil reserve construction since the launching of its
strategic oil reserve plan in 2003, with the bases in the first phase holding
30 days’ worth of China’s oil imports (Yan, 2010). Construction of the
storage tanks began in 2004, and filling began in 2005. The decision to
start building the reserves was not unanimously endorsed by the leader-
ship. There was disagreement, dating back to at least 1992, over what
volume ought to be stockpiled and when and how to finance it. The IEA
was behind China’s development of SPRs. When the US and UK were
preparing to invade Iraq, the IEA feared that the war could reduce or halt
the export of oil from the Middle East region and that China, with its very
rapidly growing demand for oil, could worsen the already fragile world oil
markets.

The four completed SPRs on the eastern coast have a capacity of over
100 million barrels of storage, and there are plans to increase SPR capacity
to 500 million barrels by 2020 (IEA, 2012: 9). In addition to the current
strategic oil reserves that are stored in the form of crude oil, there is dis-
cussion about expanding the reserves to encompass refined oil supplies as
well (IEA, 2012). In addition to the SPRs, China requires state-owned and
medium-sized oil companies to maintain their own oil reserves (Chen and
Lim, 2008). This became mandatory when the energy law was passed by
the State Council in 2007.
China is potentially very vulnerable to supply and price shocks. At the
same time, as the second largest oil consumer and importer in the world,
how it behaves in the international oil market is watched very closely
around the world. In the 1980s, China was a major exporter of crude oil.
However, by 1993 it had become a net importer of oil. Today, the country
must import over 50 per cent of its oil requirements. Other factors of
key significance are the fact that most of China’s oil imports come from
regions suffering from political instability (Africa and the Middle East)
some 60 per cent of the imports must pass through the Malacca and
Singapore Straits, a critical geographic chokepoint which some analysts
believe could be blockaded, albeit temporarily. Since the 1970s, sudden
price hikes in transport fuel have caused political unrest in several Asian
countries. Thus another reason for China’s establishing SPRs is to prevent
similar riots from occurring in China.
Other non-OECD countries

The second largest non-IEA SPR will be in Russia, where up to 15 million
tons of SPR stocks are being amassed. Russia initiated the creation of an
SPR in 2011 mainly for short-term economic reasons. The government’s
stated goals for its SPR were to ‘influence oil exports and gain profits
from price fluctuations’ (Izvestia, 2012). Taiwan, India, Chile, Thailand
and Vietnam have SPRs that have been confirmed by official announce-
ments and/or government legislation. Rwanda, Uganda, Yemen, Kenya
and Zambia have been cited as possessing SPRs. The Philippines has
announced intentions to build an SPR. The reasons given by these gov-
ernments for building SPRs are the same as those given by IEA member
states: namely, short-term energy security via emergency preparedness
against oil supply disruptions.
Thailand’s government announced in June 2012 that it intends to
increase the amount of SPRs held by private firms from 44 days worth of
imports to 90 days, citing the fact that Thailand imports around 80 per cent
of its oil from the politically volatile Middle East (Praiwan, 2012). These
reasons also provide justification for the SPRs in Vietnam and Taiwan

(Energy Information Administration, 2008; REEEP, 2009). The Indian

government announced plans to establish SPRS in 2004. Comprised of
both crude oil and oil products, the goal was to amass the equivalent of
15 days of consumption for contingency plans and also to lower market
prices of oil in the event of price fluctuations (Ma and Sharma, 2011).
The Philippines also announced its intention to create an SPR to provide
oil security in the event of an oil crisis and also to mitigate oil import price
volatility (PhilNews.com, 2011). Regarding energy security-related stock-
piling as a non-priority in such countries provides a possible explanation
for the relatively small size of their SPRs, as they are not meant to substi-
tute for consumption on a scale similar to the IEA members’ SPRs.
The justification and operation of SPRs in these countries is thus based
on a wider definition of ‘strategic’ compared to countries with SPRs
managed in accordance with the IEA SPR policy. While the IEA countries
use their SPRs to enhance energy security and economic resilience, the
strategic importance in these particular non-IEA countries centres around
their SPRs’ potential to function as a hedge against oil price fluctuations.
Drawdowns from the SPRs of such countries will likely be far more fre-
quent to fulfil their objectives of maximizing short-term economic gains,
whereas the IEA’s SPRs may be drawn upon only in the event of an actual
physical shortage of oil.8
PROBLEMS WITH SPRs
Maintaining SPRs is costly and also requires the good will of the private
sector in terms of keeping precise records and transparency (Bohi and
Toman, 1996: 126). At any given time, the government must know exactly
how much oil is available. There must be clear guidelines within the coun-
tries pertaining to the release of the reserves, especially if some are held by
private companies.
SPRs may well ease a short-term crisis. However, if the political problem
causing the supply/price disruption dragged on for months or longer, the
SPRs would soon be exhausted.
STRATEGIC GAS RESERVES IN OECD COUNTRIES
Compared to strategic oil reserves, global strategic gas reserves are much
more modest, with both the stockpiling regulations and actual physical
stocks still in nascent stages of development. Strategic gas reserves are
commonly stored underground or aboveground as LNG, with the latter

method being smaller in size and more costly. The methods of under-
ground gas storage include oil field reservoirs, aquifers (EIA, 2004),
as well as caverns percolated out of salt layers (GDF SUEZ, n.d.). At
present, there are 12 countries that have gas storage equivalent to at least
10 per cent of their annual demand (EIA, 2004).
In the United States, the 2005 hurricane season resulted in a 10 per
cent fall in natural gas production in the Gulf of Mexico. Following this,
policymakers began to consider the benefits of building a natural gas stra-
tegic reserve (Sandia National Laboratories, 2006). In 2006, H.R. 5048
was introduced to direct the Secretary of Energy to undertake a study of
the need for and feasibility of establishing a strategic natural gas reserve
(Opencongress.org, 2006).
The Danish government has access to about 515 million cubic metres
(mcm) of strategic storage capacity. This includes an amount directly
reserved by Energinet.dk9 and volumes made available from ship-
pers’ storage filling requirements. In Italy, the Ministry of Economic
Development Communiqué sets strategic stock volumes each year based
on assumptions of import reduction through the system’s major entry
points. Strategic stocks belong to storage companies. Stocks should
cover for 60 days or a 50 per cent disruption of peak capacity at the main
national entry point. In 2010, Italy had around 5.1 bcm of strategic stocks.
During the winter of 2005–2006, Italy faced a gas shortage due to reduced
supply from Russia. In response, the Italian Administration decided to
release 1.5 bcm from the strategic reserves (IEA, 2010).
As of December 2011, Hungary was the only IEA country with strategic
gas reserves under government control. These were created in the wake of
the gas crisis of January 2006. Stocks reached the initial planned level of
1.2 bcm in early 2010, covering 40–45 days of average demand. As of July
2011, this had been reduced to 0.92 bcm, equivalent to around 30 days of
demand (IEA, 2012b).
In Poland, compulsory gas stocks are held at the disposal of the
Minister of Economy. These stocks may be released by operators after
receiving permission from the Minister of Economy (IEA, 2011a). In
Portugal, mandatory gas reserves are mixed with commercial stocks. The
average stock of mandatory gas reserves was estimated to be around 234
mcm in 2008, equivalent to 20 days’ imports. The volume of commercial
stocks was estimated to be equivalent to 3.5 days of imports (IEA, 2011b).
In Spain, according to Royal Decree 1766/2007, natural gas and LPG
operators are obliged to hold minimum stocks equivalent to 20 days’
consumption, consisting of 10 days of strategic reserves and 10 days of
operational reserves (IEA, 2011b).

STRATEGIC GAS RESERVES IN CHINA AND INDIA
Due to critical gas shortages in 2009, construction of three gas stock

facilities in China began in 2010, with a total working capacity of 1.4 bcm.
Another 10 facilities are being planned (IEA, 2012a). These reserves are
regarded as crucial for China given its aim to double the consumption of
gas from about 4 per cent of total energy consumption to 8 per cent by
2015. China’s natural gas consumption grew 20 per cent in 2010 to reach
106 bcm, and is expected to reach 260 bcm by 2015 (Oliver, 2012). The
main reason for the rapid expansion in the use of gas is the fact that the
carbon emissions released in the burning of gas are far lower than those
of oil or coal.
The Indian government is currently studying ways to construct 15 days’
worth of strategic gas reserves to ensure that supplies will not be disrupted.
This is in anticipation of increased demand for natural gas in the future.
India’s gas consumption is projected to increase from 65 mcm per day to
300 mcm by 2025 (Silicon India, 2012).
PROBLEMS WITH GAS SPRs
Although strategic gas reserves can help to reduce price volatility and
smooth variations in supply, the costs and limitations of storing natural
gas are significantly higher than for oil storage. According to the IEA, the
costs of underground gas storage are five to seven times higher than for
underground oil per ton of oil equivalent stored. The variable costs for
maintaining gas in storage are also significant. The variable cost of main-
taining 90 days’ imports in reserves across the IEA was USD 5.4 billion per
year in 2010. Variable costs are determined by economic factors such as
interest rates, maintenance and cost of personnel, and also gas leakage,10
a factor specific to natural gas. The main reasons for the high costs of gas
storage compared to oil are twofold: the gaseous nature of natural gas and
its low energy density.11 In order to prevent the gas from escaping, natural
gas must be fully contained at all times. Its low energy density also means
that its energy density must be increased so as to make storage economi-
cal. As a result, natural gas must be stored as a liquid, either via compres-
sion at high pressures or through condensation at low temperatures, both
of which result in significant equipment and energy costs (IEA, 2012d).
Gas reserves are also less effective than oil reserves in mitigating supply
risks. Compared to oil, gas has a less robust and interconnected infrastruc-
ture. For instance, disruptions in a gas pipeline will affect the entire down-
stream distribution of gas. On the other hand, repairs to an oil pipeline are

not only cheaper, alternative transport options in the form of oil trucks or
tankers can also be utilised. As a result, this calls for multiple gas reserves
to be sited close to corresponding consumption centres throughout the
country, and this further increases the cost of storage (IEA, 2012d).
Due to its high cost and lower effectiveness compared to oil stocks,
few countries have strategic gas reserves. The IEA recommends using gas
storage as a part of a wider suite of options such as fuel switching and
interruptible contracts (IEA, 2012d).
STRATEGIC COAL RESERVES
To date, there are no countries with established strategic coal reserves. The
only country with such plans is China, which aims to create a strategic coal
reserve by 2015 (China Daily, 2009; Yu, 2008). Nearly 80 per cent of the
electricity generated in China is from coal. The country has a staggering
appetite for coal, with over 80 per cent of the global increase in coal demand
coming from China alone. China’s share of global demand increased from
27 per cent in 2000 to 47 per cent by 2010, with coal use more than doubling
to 2,350 million tons of oil equivalent. In 2009, China consumed more coal
than the next 16 largest consumers combined (IEA, 2012c).
China’s total coal reserves (proven reserves ready for extraction) in
2011 stood at 1.021 gigatons (Gt), with a reserve-to-production ratio of
70 years. Most of these are underground, with only around 100 Gt of coal
reserves able to be extracted from existing mines. Domestic output con-
tinues to increase. However, as the country has not been able to meet the
continuously increasing demand, the country became a net coal importer
in 2009. A second reason for importing is coal quality. Under strong
international pressure, the government is trying hard to minimise carbon
emissions. To this end, it is importing coals which are of higher quality
than the local coals. A third reason is insufficient railway capacity. There
are not enough railway cars available for loading at the mine sites, and the
railway lines emanating from the main coal mining areas in the interior of
the country simply cannot handle more coal traffic to the power plants in
the eastern region. This has been a continuous problem since the 1950s but
hitherto has been resolvable (Thomson, 2003).
A strategic coal reserve will help balance market demand with supply
and keep coal prices down. Coal reserve legislation was put forward in
September 2008 under a scheme to establish a Chinese legal system for
coal which aims to ensure sustainable development of the industry (Yu,
2008). The strategic coal reserve will include rarer types of coal, and will be
a mixture of spot and resource reserves.

In 2009, the National Development and Reform Commission (NDRC)

commissioned China Shenhua Energy Co, the nation’s top coal producer,
to build 10 storage facilities for coal throughout the nation. These reserve
sites will hold a total of between 100 to 200 million tons of coal. Zhejiang
and Shandong, two major coal producing provinces, have already starting
building pilot coal reserve bases. China aims to keep the equivalent of 10
per cent of its domestic consumption in reserve (Letzing, 2009).
It was reported in 2011 that the State Council had approved a pro-
gramme for emergency state coal reserves, which would begin storing 5
million tons of coal in the same year. At the provincial level, Shandong
announced plans to build up to eight coal reserve plants with total reserves
of 6 millions tons by 2015 (Chinamining.org, 2011a). Dafeng Port in East
China’s Jiangsu province has also been selected as one of China’s coal han-
dling bases for strategic reserves. The port has a throughput of 3.6 million
tons of coal per annum and its warehousing and logistics businesses will be
further developed to serve coal mining enterprises in neighbouring areas
such as Qinhuangdao (Chinamining.org, 2011b).
PROBLEMS WITH COAL STORAGE
Similar to natural gas, coal has a lower energy density compared to oil.
This therefore leads to high transport costs and high storage requirements,
which translates into high maintenance costs. In addition, there are also
safety issues to consider as steam coal is prone to spontaneous combustion
and efflorescence (China Daily, 2009).
CONTROVERSIES SURROUNDING THE RELEASE

OF SERs
SERs are created with the intention of addressing supply disruptions.

Strategic stocks, by definition, are different from commercial stocks. The
latter are held by private companies or private consumers to guarantee
the smooth functioning of their equipment, or in anticipation of financial
gain when prices could rise in the future. Commercial stocks are therefore
determined by the requirements of the stockholder, the size of available
storage facilities and expectations about future prices. On the other hand,
strategic stocks are meant to deal with extraordinary situations, when
a security threat is perceived. At the extreme, this could refer to open
warfare, but as one moves away from the extreme towards more nuanced
situations, it becomes increasingly difficult to differentiate commercial

and strategic threats, and hence when it is appropriate to draw down stra-
tegic reserves (Luciani and Henry, 2011).
A physical shortfall and major change in price are usually related, since
a drop in supply will raise prices. However, it is difficult to define a histori-
cal point in time when a physical shortfall has resulted in a threat to energy
security. Although political unrest and turmoil can disrupt a country’s
output, global supply consists of the sum of declines in some fields and
increases in others. Therefore, it is often the case that any shortfalls are
made up by increased production from other countries.
According to the IEA, the most important oil supply disruption
occurred during the Iranian Revolution, when 5.6 million barrels per
day were lost for six months. However, this loss was compensated for by
increased production in other countries, even leading to an increase in
global oil production between 1978 and 1979. As such, situations in which
there is a clear disruption in physical supply are extremely rare. A defini-
tion of a threat based on high oil prices would thus be much clearer than a
definition based on physical supply. However, doing so would mean that
there is little difference between strategic and commercial stocks (Luciani
and Henry, 2011).
This conundrum is visible in the history of the United States’ SPR,
where there have been differences in opinions as to what constitutes a
“severe energy supply interruption” (Energy Security Analysis, Inc, 2003;
Styles, 2012). This includes increases in prices of oil products independent
of crude prices and also increases in crude prices without any measurable
shortages in crude supply. A glaring example of the thin line between stra-
tegic and commercial stocks can also be seen in the example of the Clinton
Administration selling 7 million barrels of oil to help finance the SPR pro-
gramme in FY 1996. This set a precedent for three further sales in FY1996
for budgetary reasons (Bamberger, 2009).
The proper use of SPRs has thus been a perennial subject of contention.
There has been increasing flexibility in the latest coordinated drawdowns
from the IEA’s SPRs. During the Gulf War, for instance, the IEA coor-
dinated a release of SPR stocks to mitigate an anticipated price increase
associated with fears of an impending crude oil shortfall. The use of the
SPR to mitigate an anticipated price increase, instead of a “severe energy
supply disruption”, was controversial and was the subject of debate. This
event revealed the complexities inherent in governments’ decision-making
processes in controlling their oil stockpiles. This debate was revisited
during the 2011 SPR drawdown, triggered by the Libyan revolution,
where the release of SPR oil stocks was justified as a pre-emptive measure
to prevent price spikes and the consequent economic impacts. According
to the IEA, the Libyan drawdown was justified as a means to ensure

an adequate supply of oil in the market in order to protect the global

economy from ‘unnecessary damage when it is in a fragile state’.12
WHY SOME GOVERNMENTS HAVE NO PLANS TO

BUILD SERs
Several non-OECD countries choose not to maintain strategic energy

reserves (Taylor and Van Doren, 2005). Just as some IEA member coun-
tries are not required to maintain SPRs because they are net exporters
of oil, net exporters of oil outside the IEA, such as Papua New Guinea,
Brunei and Mexico, do not to maintain SPRs. As noted above, Russia has
recently chosen to create an SPR, but for commercial rather than energy
security-related reasons.
The reasons why net oil-importing countries choose to not maintain
SPRs are less clear as information from official sources is sparse. In coun-
tries such as Zambia, Tanzania and Uganda, where plans for SPRs have
been either aborted or left incomplete, the poor progress of their SPR
projects can be reasonably, or at least partially, attributed to the inability
of their economies to provide adequate funding and also the instability of
their political regimes.
Some inferences can be drawn from China’s SPR experience. China
is in the process of constructing the largest SPR outside the OECD but
progress on it has not been without opposition. Even after it was officially
endorsed, there has still been a strong anti-SPR faction in China that has
contributed to delays in implementing the project (Downs, 2004). The eco-
nomic rationale cited by opponents of China’s SPR include the contention
that China cannot afford to build an SPR that is large enough to be effec-
tive for energy security and its scarce resources would be better allocated
to more important and pressing priorities (Downs, 2004). Another reason
cited is the fact that China’s electricity is generated mainly by coal and
thus creating an SPR is unwarranted, though this overlooks the rapidly
growing demand for oil in the transport sector (Downs, 2004). The oppo-
nents of China’s SPR also contend that creating an SPR is unnecessary as
China’s energy security would be better enhanced through other means,
such as energy diversification and acquiring stakes in overseas oil fields
(Downs, 2004).
Other countries may have other reasons not to maintain an SER.
Malaysia’s lack of an SPR and decision to enhance energy security by
reducing oil consumption through a fuel diversification policy can be
seen to reduce the need for an SPR by focusing upon long-term energy
security measures and reducing oil import dependency. Singapore, which

maintains substantial commercial oil reserves but lacks an SPR, likely

chooses not to maintain an SPR due to the lack of land and also because
the government has, in the event of an oil shock, guaranteed access rights
at market prices to commercial oil stocks stored by the country’s large
petrochemical industry.
CONCLUSION
Most governments build strategic energy reserves to help keep their

economies on an even keel in the event of an external price/supply
shock. The aim is to reduce domestic price volatility and financial losses
resulting from production stoppages and/or the imperative to make
short-term purchases of energy commodities from the spot market.
They are also often seen as contributing to international price stabil-
ity in the long run. Some governments also build reserve capacities of
oil, gas or coal for commercial reasons, i.e., to take advantage of price
variations.
The 28 OECD countries, through the International Energy Agency,
have the most sophisticated SER programmes. All must have oil reserves
equivalent to 90 days of net oil imports, and many are also establishing, or
planning to establish, strategic natural gas reserves.
Several non-OECD/IEA countries have begun, or are considering,
building SERs, mainly for genuine energy security-related reasons.
However, the perceived utility of SERs is not universal. Many govern-
ments do not believe the potential gains are greater than the considerable
costs of building and maintaining them. No doubt, many governments
have keenly watched the confused political wrangling in the United States,
where the precise purpose of the SPRs has been frequently debated, most
notably just before elections.
NOTES
1. Currently, the IEA’s 28 members are: Australia, Austria, Belgium, Canada, Czech
Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy,
Japan, Luxembourg, Netherlands, New Zealand, Norway, Poland, Portugal, Republic
of Korea, Slovak Republic, Spain, Sweden, Switzerland, Turkey, United Kingdom and
United States. Full details of the IEA’s oil stockpiling guidelines are available at: http://
www.iea.org/topics/energysecurity/ (accessed August 2012).
2. Full details of the IEA’s oil stockpiling guidelines are available at: http://www.iea.org/
topics/energysecurity/ (accessed February 2013).
3. The 1979 oil crisis was caused by the fall of the Shah in Iran.
4. Much of this information is from Elspeth Thomson (2005), “China’s Construction of

Strategic Petroleum Reserves: How Urgent?”, East Asian Institute Background Brief,
no. 243, 11 May.
5. Salt domes are also used in Alsace, France and Lower Saxony, Germany.
6. Thirty-four million barrels were released at the start of the war, though only half were
actually delivered.
7. Thirty million barrels were released to offset the lower quantities of oil exported from
Libya due to the revolution that ended Colonel Gaddafi’s regime.
8. The USA and the UK recently discussed releasing SPR stocks in order to mitigate high
gasoline prices, allegedly to boost President Obama’s electoral support in the 2012
presidential elections. This planned drawdown did not have the support of the IEA. See
(Falloon and Mason, 2012).
9. Energinet.dk is the Danish national transmission system operator for electricity and
natural gas.
10. In underground storage, gas leaks from high pressure into the atmosphere which is of
lower pressure.
11. Energy density refers to the energy content per unit mass or volume of a fuel.
12. See IEA Collective Action: Frequently Asked Questions: http://www.iea.org/topics/oil/
oilstocks/ieacollectiveaction/ (accessed 1 March 2013).
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7. Securing energy supply II: diversification
of energy sources and carriers
Kas Hemmes*
INTRODUCTION
The world energy supply is largely based on fossil fuels: oil, gas and coal.
Several scenarios for the future energy supply distribution have been made
and reported by official institutions, such as the International Energy
Agency. Depending on assumptions, a faster or slower growth of renew-
able energies is depicted. These pictures are overall scenarios for the world
energy supply. However distinctions have to be made between global
and local, centralized and decentralized systems. Moreover a distinction
also has to be made between electricity supply and other forms of energy
needed such as heat and transport fuel. It should also be kept in mind that
there is a competition on fossil fuels for use as an energy source and for
use as a bulk chemical in the chemical process industry. All these issues are
relevant in the transition to a more sustainable energy system. However,
in the process of restructuring the energy system the security of supply has
top priority. It is rather like when renovating a shop the owner puts up a
sign which says: “Business as usual during renovation”. In this chapter we
will explore the renovation of the energy sector, what kind of innovations
are taking place and can be expected, and how that could improve the
security of supply, while taking into account issues of scale and different
time horizons.
ENERGY SOURCES AND ENERGY CARRIERS
Energy Carriers
The present energy system is characterized by several energy carriers,

partly the fossil fuels themselves – coal, natural gas, oil, gasoline – but also
electricity. Reducing the number of energy carriers can increase security of
supply if it is accompanied by more interconnections in the energy system
and if we are able to convert one form of energy into the other.
Because we are so used to fossil fuels the distinction between energy
133

Nuclear Waste
Renewable 4% 3%
10%
Coal
21%
Oil
3%
Gas
59%
Source: http://www.cbs.nl/en-GB/menu/home/default.htm?Languageswitch5on (accessed

March 2013).
Figure 7.1 Distribution of energy sources for the production of electricity

in 2011 for the Netherlands
source and energy carrier has often not been very strict. For example
natural gas is an energy source as well as an energy carrier. The same
holds for coal. With oil it is a bit more difficult. Although oil tankers still
transport the bulk of the energy contained in oil across the oceans, in the
refineries oil is converted into several other bulk chemicals and fuels such
as Nafta and gasoline. We can consider oil the source but locally gasoline
is the energy carrier. For electricity the distinction is quite clear. Electricity
is not produced in nature (except perhaps in lightning, which we do not
and cannot harvest on a significant scale). So electricity only is an energy
carrier and the energy source can be quite diverse, as it is currently. In
Figure 7.1 we see the distribution of energy sources for the production of
electricity in the Netherlands.
Analysis of Energy Systems
In the next figures we see a number of possible energy systems in which

we can supply energy to the consumer; indicated by D (demand) and we
supply it from a source Y (Yield of energy). In general we have to convert
the energy form of the yields into a form that we can transport and after
transportation sometimes we have to convert it into another form as
demanded by the consumer. This is called the energy chain.
However, we must be aware that there are several interconnected chains

Diversification of energy sources and carriers 135
Y T C T D
System
boundary
Y = Yield, supply
T = Transport
i,in(x,t) j,out(x,t)
C = Conversion C
S = Storage
D = Demand
loss(x,t)
Figure 7.2 Supply chain in an energy system
in real life energy systems – certainly on longer scales. They can be inter-
connected in different ways at different points depending on the use of
converters and what type of energy carrier is dominant.
Multisource operation on a national scale increases energy security, but
if the supply systems (the energy chains) are separate, failure in one chain
will disrupt the whole supply chain. As a hypothesis we can claim that the
security of supply increases if more interconnections exist in the energy
system between the different supply chains. Interconnections can exist on
different scales and in different forms. For instance we can have fuel blend-
ing in which we mix coal with biomass and use that mix in a coal-fired
power plant. Other examples of fuel blending are the blending of bio-diesel
into fossil fuel diesel or ethanol mixed with gasoline into E-10 and other
fuel blends. There have also been studies on the blending of hydrogen into
the natural gas grid as a way of decarbonizing the natural gas fuel. This is
also a form of blending fuel. When we blend different fuels of course the
conversion devices should be suitable for – or adapted to – the new blends
of fuels. They are preferably continuously adoptable to a wide range of
mixing ratios.
In general energy conversion leads to losses, but these can be minimized
by technical improvements of the efficiency, but also by using a waste
stream as in combined heat and power. Combined heat and power is a
form of making interconnections in the energy system since the waste heat
is coupled into the energy system as an energy carrier and used down-
stream. If combined heat and power is not applied the supply chains are
not interconnected and heat is wasted into the environment (air or cooling
water of the power plants). So by interconnections total conversion

efficiency can increase. Some systems can produce three products and
are called tri-generation systems. Although the name can refer to any
three energy carriers as a product, often the name is reserved for systems
that produce power, heat and cold. Below as an example the so-called
Superwind concept will be described. In short Superwind is a concept
based on a high temperature fuel cell capable of coproduction of hydrogen
and power with some waste heat with natural gas or biogas or a mixture
of both as the energy source. Here efficiencies even further increase even
without counting heat as a useful product in the efficiency definition.
Issues of Scale
As discussed elsewhere, the issue of scale in energy supply is important. It

refers to time (short-term versus long-term) as well as place (local versus
global). Security supply can be analyzed on different timescales and length
scales. On the timescale we can distinguish between short-term, medium-
term and long-term issues. Considering the short-term security of supply
normally we call it differently namely: ‘reliability’. We can link security of
supply on the medium term to the flexibility of our system to cope with
temporary disruptions in one form of energy and therefore switching to
another form of energy as our main source. Security of supply on the
long term refers to our sources of energy in the long run when fossil fuel
reserves will be diminished.
When we consider the scale length or the size of the system, security of
supply on smaller systems such as a household or a neighborhood or an
industrial installation refers to the security of supply in the sense of reli-
ability of our system to perform what it is supposed to perform. Security
of supply on median-length scales could refer to the energy supply for a
region or country whereas security of supply on a long-length scale would
refer to security of supply for the whole earth or security of supply glo-
bally. If you put these in a matrix, length scales versus timescales, we can
distinguish nine areas with different issues and sometimes also different
names for what we in general might call security of supply (see Table 7.1).
Flexibility
Obviously when the supply of one sort of energy is hampered either by the
fact that it is running out (long-term issue) or that the transport is blocked
by technical (gas pipeline rupture) or geopolitical issues, the security of
energy supply is increased if one can replace one source of energy easily
by another source of energy that still is available. The energy system thus
becomes more robust if it is flexible in its sources of energy. This holds for

Table 7.1 Main security of supply issues on different length scales and

time scales
SoS main issues Short term Medium term Long term

Single Unit – eco park Reliability Economic Availability of
feasibility of particular energy
particular energy form needed
source
Region – country Geopolitics Transition Backcasting
and technical management
disruptions in
the supply chain
Global Market price Choice of energy Energy scenarios
fluctuations carriers and its
transport
example for a small energy system like a car (single unit) that can run on
gasoline as well as on LPG and can easily switch between them, as well as
for a country that can switch between different fuels on a national scale.
The latter can be achieved with either multi-fuel appliances like the car
in the example above, or by multiple appliances that can be chosen to
operate depending on the type of fuel available. Another approach is the
choice of energy carrier and associated infrastructure.
The dual fuel or even multi-fuel appliances are to be preferred in general
because less capital is needed for the infrastructure and the same appliance
can be kept running on one fuel or the other depending on its price and
availability. In the case of separate appliances they will stand idle if the
particular fuel is not available or is too expensive.
Fuel Blending
Another form of flexibility in energy sources is mixing fuels. This is done

on a large scale in the transport sector with the introduction and mixing
of bio-diesel in ordinary diesel and for example bio-ethanol with gasoline.
The European Renewable Energy Directive introduces a binding target of
10 per cent renewable energy in transport by 2020.
On a much smaller scale synthetic natural gas (SNG) is produced from
biomass and introduced into the natural gas grid. With this European
objective of blending biofuel with fossil fuel for the transport sector huge
amounts of biomass will be reserved for this application and probably
little will be left for synthetic natural gas production. But the principle is

blending of fuels and thereby increasing security of supply in two ways:

firstly decreasing the use of fossil fuels maintaining their reserves and
secondly broadening the supply base with introducing a second supply
source, SNG in this case.
A simple form of integration is the co-firing of biomass in a coal-fired
power plant. Other simple forms of such integration are the preparation
of blended fuels obtained by mixing bio-ethanol or bio-diesel into the
respective fossil fuels. However, the co-firing of biogas from a biomass
gasifier in a natural gas fired power plant would be a form of integra-
tion of sources going one step deeper, because it is not just a mix of fuels
entering the same equipment that would need only small adaptations to
the new fuel mix. Sometimes a biomass gasifier is needed to first covert
one of the input streams before it is mixed with the other conventional
main stream.
Multisource Multiproduct Energy System
There is a new development called multisource multiproduct (MSMP)

energy systems. These systems differ from dual fuel appliances in the sense
that in dual fuel appliances either one or the other fuel is used like in the
example of the car running on gasoline or LPG, while in multisource mul-
tiproduct energy systems the system in principle can run on two or more
energy sources simultaneously in a flexible way and produce more than
one form of energy output. Multisource multiproduct systems are defined
on the level of the conversion devices on the small length scale. Of course
we can see the whole energy system for a country as a huge multisource
multiproduct system but we want to exclude that from the definition,
because it has no added meaning.
MSMP systems introduce flexibility needed in energy systems that have
to cope with fluctuating demand and with the introduction of renewable
energy sources like solar and wind also have to deal with fluctuating
and not controllable supply. In general we will illustrate a topology of
integration levels in multisource multiproduct energy systems. There are
different forms of integration from loosely coupled through producing
electricity for a common grid, to more intimately coupling in coal and
biomass combustion for example or blending of biofuel into gas, gasoline
and diesel:
● Single input single output conversion systems

● Combined heat and power
● Tri-generation.

F Biomass
E-net
Co-firing
F Bio-ethanol
Transport
Bio-diesel mix
Figure 7.3 Simple form of multi-input systems combining fossil energy

with renewable energy by blending
1 Linear energy system
2 Co-generation system
3 Tri-generation system
Figure 7.4 Classification of energy systems
The principle of cogeneration is well-known and widely applied for

example in combined heat and power applications. The term tri-generation
has been proposed for systems capable of the co-production of electricity,
heat and cold, but also for the co-production of electricity and heat in
combination with a chemical product such as hydrogen. This illustrates
that a linear system as in Figure 7.2 is not generic, but only a simple repre-
sentation of an example system. In general, often more than one product
is produced. The other products are seen as a byproduct or even just as
waste.
However, more than one source can also be applied on the input side,
while the degree of integration may differ strongly. This can be illustrated
by the familiar example system, called ‘House’. Often the house is con-
nected to three sources of energy: natural gas, electricity and passive sun-
light for space heating, but those sources are not controlled and integrated
but largely function independently.
Hence we must consider integration of sources into multisource
multiproduct energy systems.

P L
P
Energy Hub
Inputs Outputs
MSMP L
P L
Figure 7.5 Schematic illustration of a multisource multiproduct energy

system (or energy hub)
We will give several examples of such multisource multiproduct energy

systems:
● Superwind
● Direct carbon fuel cell producing CO
● Hybrid systems of CSP and gas.
Superwind
Problems in practice are often different from those first anticipated. In the
case of wind energy the problem is often phrased as the unpredictable and
fluctuating character of the produced electricity. The solution generally
proposed is to store the energy in batteries or to convert the wind electric-
ity into hydrogen by electrolysis and subsequently store the hydrogen for
later use in a fuel cell to produce electricity when there is little wind. This
conventional ‘hydrogen’ storage solution suffers from a number of prob-
lems. Because a series of conversion steps are needed, overall efficiency
becomes very low. For a rough order of magnitude calculation we may
assume an efficiency for electrolysis of 80 per cent, 20 per cent losses in
hydrogen storage and 40 per cent efficiency for the fuel cell. These indica-
tive figures lead to an overall efficiency of only about 25 per cent! (0.8 *
0.8 * 0.4 5 0.256). Moreover, this conventional solution requires three
types of equipment: electrolysis, hydrogen storage and fuel cells each with
associated high capital costs. In addition, this expensive equipment is not
used all of the time. On the contrary, it is intended to be used only when
there is a surplus of electricity that absolutely cannot be used directly or
fed into the grid. In an economic evaluation this will evidently lead to a
poor return on investment.
However from the perspective of an individual wind turbine owner
or wind corporation, the problem is to deliver electricity as promised on
the “one day ahead” market (for example the APX, Amsterdam Power
eXchange). When the wind fails to deliver what is predicted by weather
models and subsequently offered to the market, the owner faces financial

penalties from the electricity traders. So wind turbine owners are looking
for a technology that “fills in the gaps” rather than for a technology that
“shaves the peaks”. The conventional solution is a typical exponent of
our way of thinking about energy systems, being linear and either fully
renewable or completely based on fossil energy. The idea of producing
pure renewable (“green”) electricity or hydrogen is very appealing to
policymakers and the public. Large projects are carried out or planned to
demonstrate this option that lacks rationality when seen from a system
perspective as argued above. As long as wind energy is not the main source
of electricity, storage is often not absolutely necessary as was shown in a
recent study for the Dutch government. Instead, flexible production by
complementary systems can be considered and of course demand side
management, whenever that is possible. Yet part load operation of con-
ventional technology will lead to decreased efficiencies, and a temporary
stop of production will lead to a decreased economic efficiency. For fuel
cell technology however, the situation is quite different. In principle the
efficiency of fuel cells increase when operated in part load. But even more
interesting the flexible co-production of hydrogen and electric power by a
high temperature internal reforming fuel cell fueled by natural gas, offers
the possibility to continuously produce valuable economic products all
the time (Hemmes et al., 2008). If less electricity is needed the operation
can be changed to produce more hydrogen. This concept that we called
Superwind is a promising alternative if a hydrogen market is developing
in the future, for example for the automotive sector (Hemmes et al., 2007).
Flexibility of this Superwind concept can also be used to adapt gradually
to a growing demand for hydrogen when more and more hydrogen fuel
cell vehicles appear on the roads and the hydrogen demand increases.
Applying the Superwind concepts allows the operator to produce more
hydrogen when needed, without additional investments in the production
capacity while in the beginning at low hydrogen demand this installation
is still economically producing valuable goods namely electricity and heat.
Also, large-scale industrial energy conversion systems such as coal
gasification units combined with integrated gasification combined cycle
technology should be studied for their possible suitability for the flexible
coproduction of hydrogen and electric power.
In many places natural gas and sometimes biogas or even hydrogen is
available and these can be applied in combination with wind and solar in
order to compensate for, or better, to be complementary to these fluctuat-
ing renewable energy sources. So, more research should be focused on the
development of flexible and dynamic electricity production methods. The
research on large-scale production and storage of hydrogen produced by
electrolysis from wind and solar energy does not seem to be necessary at

E-power E-power
IR-FC
CO/H2
NG
Heat
Figure 7.6 Schematic representation of the Superwind concept
the moment. The situation might change if wind and solar are applied at
such a large scale that significant overproduction may exist at a significant
fraction of the time.
Direct carbon fuel cell producing CO

In earlier work we have proposed an exciting, but still theoretical, pos-
sibility of the electrochemical gasification of (pure) carbon into carbon
monoxide with the simultaneous conversion of (solar) heat and reaction
enthalpy into electric power (Peelen et al., 1998). Because carbon mon-
oxide can be converted with steam into hydrogen and carbon dioxide
in the so-called shift reaction, we have in fact obtained a fuel cell that
produces hydrogen instead of consuming it, and converts heat into power
instead of dissipating heat. This would be a true MSMP system in which
carbon and solar energy are converted into hydrogen, electricity and heat
(Hemmes, 2004). Additionally solar energy can first be used to convert
natural gas into carbon and hydrogen. And subsequently the carbon can
be electrochemically converted into carbon monoxide with the help of
solar energy input, while this carbon monoxide can be a second source
for hydrogen through the shift reaction with steam. Needless to say that
this still requires further simulation and feasibility studies and if these
are positive a huge technological development is needed. A most suit-
able location for the implementation of the concept would be North
Africa (Algeria, Egypt) which has a large potential for solar energy and
resources of natural gas. The hydrogen produced or hydrogen methane
mixtures as proposed in the European research project NATURALHY,
can be transported to Italy by pipeline to supply Europe with an increas-
ing amount of renewable energy.
Hybrid systems of CSP and gas

A further integration of energy sources is for example achieved by the
performance of endothermic chemical reactions like steam reforming of

natural gas with the aid of the heat from concentrated solar power or
nuclear energy. This example also illustrates the possibility of the inte-
gration of a fossil energy sources with a renewable energy source or even
nuclear power. An alternative would be the thermal decomposition of
natural gas (methane) with the aid of the heat from concentrated solar
power. The clean hydrogen produced is easily separated from the solid
carbon contrary to steam reforming where it has to be separated from a
gas mixture containing carbon monoxide, carbon dioxide and steam using
PSA (Pressure Swing Absorption) or other costly separation technologies.
Obviously one has to find useful applications for the carbon, or carbon
black as it is often called. There are applications for carbon in printers
and in car tires, but not for the quantities in which it will be produced in
the future if these technologies are applied on a large scale. This would
require a demand for much larger quantities. A number of them are
proposed in the literature by Muradov et al., one of them being Direct
Carbon Fuel Cells which are presently under development (Muradov and
Veziroglu, 2005).
In cooperation with the University of Perugia we have calculated that
in a solar natural gas decomposition setup a ratio of 80/20 is typical for
the relative contribution of fossil energy versus solar energy (Cinti 2011).
Hydrogen as a Universal Energy Carrier
Since the 1970s hydrogen has also been proposed as an energy carrier, with
the idea that fossil fuels will eventually run out and have to be replaced
by renewable energy sources such as wind energy and solar energy. These
renewable energy sources mainly produce electricity but contrary to
fossil energy these are fluctuating and do not include a storage function.
Another well-known drawback of solar and wind related to this is the
fluctuating nature of these sources on different time scales (seconds to
days, weeks and even seasonal fluctuations). Some are very predictable
such as day/night patterns for solar, but some are less predictable such as
clouds for solar and wind speed forecasts for wind energy. As a solution,
storage in the form of hydrogen has been proposed. But hydrogen can
also be used in the transport sector and does not need to be converted
back into electricity. With the development of a hydrogen economy as it
was called other sources for the production of hydrogen can also be devel-
oped. In fact one of the main advantages proposed by the promoters of the
hydrogen economy is that hydrogen can be made in so many ways, from a
variety of sources, thereby providing or at least increasing energy security.
In the early days of the ideas on the hydrogen economy and sometimes
even now, one can observe a rather naïve attitude towards real-life energy

systems, leading to severe criticism on the hydrogen economy (e.g. by

Bossel 2006). Since hydrogen is not an energy source but only an energy
carrier, it must always be made by conversion from another form of
energy and – although often ignored – a source of hydrogen atoms, for
example water. Conversions are accompanied by losses and conversion
units cost money, so hydrogen in general will be more expensive than the
original source.
Secondly hydrogen can be stored, as is often claimed, but not so easily,
nor on a large scale. Also the required purity of hydrogen for different
applications is an issue that is not often considered in general concepts of
the hydrogen economy. Thirdly a quantitative argument holds that as long
as electricity production from renewable energy is not abundant, it makes
much more sense not to convert renewable energy but to keep it in the
form of electricity as the energy carrier. Also converting it on a large scale
would require a huge capacity in the form of electrolyzers. Electrolyzers
are devices similar to fuel cells and similarly priced.
The conversion efficiency argument can be addressed by MSMP
systems with inherent higher efficiency. This can be illustrated with the
very ambitious plans of the Dutch government. The 6 GW offshore wind
energy parks would only provide about 2 GW continuously, providing 1.6
GW of hydrogen when assuming 80 per cent efficiency of the electrolyzers.
If we compare this with the 40 billion normal cubic meters of natural gas
consumed in the Netherlands on a yearly basis, the hydrogen thus pro-
duced from offshore wind energy would only suffice to provide 3.5% of
total Dutch natural gas consumption. (1.6 GW/(40.109 Nm3/year 10 kWh/
Nm3). (1/(8760 h/year)) x 100%)
CONCLUSIONS
An attempt is made to systemize energy systems in terms of building

blocks, supply chains and their interconnectivity. Building blocks are
yield (the source), transport, conversion, storage and end use (demand).
Interconnections are seen in fuel blending, combined heat and power,
tri-generation systems and in MSMP energy systems. Interconnections
also follow from reducing the number of energy carriers of which the
hydrogen economy is an extreme case, in which hydrogen and probably
also electricity are the only energy carriers.
Disruption in one energy source (Yield) does not lead to the disruption
of the whole supply chain, because other sources from a redundant chain
can take over via a common hydrogen energy carrier. This disruption need
not only be on a large scale over a longer period of time, but can also be

fluctuations in, for example, renewable energy sources like wind energy
and solar energy. MSMP energy conversion systems especially are shown
to be highly efficient and flexible thereby improving the system’s security of
supply and overall efficiency at the same time. Moreover, interconnections
between different supply chains often make the use of storage unnecessary.
NOTE
* This research has been partly financed by a grant of the Energy Delta Gas Research
(EDGaR) program. EDGaR is co-financed by the Northern Netherlands Provinces,
the European Fund for Regional Development, the Ministry of Economic Affairs and
the Province of Groningen. The author would like to thank the section “Technology
Dynamics and Sustainability” of the Faculty of Technology Policy and Management,
Delft University of Technology, for constant support.
REFERENCES
Bossel, Ulf (2006), “Does a Hydrogen Economy Make Sense?”, Proceedings of the IEEE,
94(10), October.
Cinti, G. and K. Hemmes (2011), “Integration of direct carbon fuel cells with concentrated
solar power”, International Journal of Hydrogen Energy, 36(16): 10198–10208.
Hemmes, K. (2004), ‘Fuel Cells’, in R.E. White, B.E. Conway and CG. Vayenas (eds),
Fuel Cells; in Modern Aspects of Electrochemistry, Modern Aspects of Electrochemistry,
Vol 37, New York, Kluwer.Academic/Plenum Publishers, pp. 131–251.
Hemmes, K., L.M. Kamp, A.B.H. Vernay et al. (2007), “A multi-source multi-product
internal reforming fuel cell energy system as a stepping stone in the transition towards
a more sustainable energy and transport sector”, International Journal of Hydrogen
Energy, 36(16): 10221–10227, DOI: 10.1016/j.ijhydene.2010.11.017.
Hemmes, K., J.L. Zachariah-Wolff, M. Geidl et al. (2008), “Towards multi-source multi-
product energy systems”, 2nd European Hydrogen Energy Conference, Zaragoza, Spain,
22–25 November 2005, International Journal of Hydrogen Energy, 32(10–11): 1332–1338,
DOI: 10.1016/j.ijhydene.2006.10.013.
Muradov, N. Z. and T.N. Veziroglu (2005), “From hydrocarbon to hydrogen-carbon to
hydrogen economy”, International Journal of Hydrogen Energy, 30(3): 225–237.
Peelen, W.H.A., K. Hemmes and J.H.W. De Wit (1998), “Carbon a major energy carrier
for the future? Direct carbon fuel cells and molten salt coal/biomass gasification”, High
Temperature Material Processes, 2(4): 471–482.
Vernay, A.L. G. Steenvoorden and K. Hemmes (2008), “Superwind: A feasibility study.
Integrating wind energy with internal reforming fuel cells for flexible coproduction of
electricity and hydrogen”, final report for Senternovem, November 2008, Project number:
NEOH 02010 Senternovem. 2008, Delft, TU Delft.

8. Energy security assessment framework
and three case studies
Aleh Cherp and Jessica Jewell
INTRODUCTION
The interest in measuring energy security results not only from its rising
prominence but also from its increasing complexity. In the past, energy
security concerns were no less acute than they are today. Consider, for
example, the importance of access to oil for nations engaged in major wars
of the 20th century. Yet, to strive for energy security in such cases did not
require complex measures because policy makers were directly engaged
and closely familiar with these immediate and pressing issues. In contrast,
today’s energy security problems often overlap national, institutional and
sectoral boundaries stretching the cognitive abilities of experts and policy
makers to deal with diverse situations and challenges which may not be
directly familiar or predictable. One approach to cutting through this
complexity is relating energy security to a common yardstick that would
allow comparing it across different countries, at different points in time or
to other policy priorities, in other words quantitatively measuring energy
security.
The challenge of measuring energy security is not only to see through
natural, technological, and economic complexities and uncertainties, but
also to address the fact that it has different meanings for different groups
(Chester, 2009). No single set of metrics is suitable for assessing energy
security for all purposes in all situations. Instead energy security should
be measured through application of an assessment framework sufficiently
systematic to ensure scientific rigor and sufficiently flexible to account for
specific circumstances and perspectives (Cherp and Jewell, 2011a). This
chapter outlines such a framework and illustrates its application in the
following three cases:
● The International Energy Agency’s Model of Short-term Energy

Security (MOSES) (Jewell, 2011). The purpose of MOSES was to
depict the energy security landscape of the 28 IEA member coun-
tries by characterizing their energy security profiles and grouping
together countries with similar energy profiles.
146

Energy security assessment framework 147
● The Global Energy Assessment (GEA) (GEA, 2012), a major inter-

national effort to evaluate energy challenges and construct long-
term scenarios for meeting these challenges. The purpose of GEA’s
energy security assessment (GEA Chapter 5, Cherp et al., 2012) was
to “identify common energy security concerns (in over 130 coun-
tries) affecting significant parts of the world’s population”.
● A set of recent studies of energy security in future scenarios based
on the methodology originally proposed by (Jewell, 2010) and
subsequently used in Chapter 17 of GEA (Riahi et al., 2012) as
well as in Jewell et al. (2012) and Cherp et al. (2013). The purpose
of these studies has been to analyze energy security in long-term
(up to the year 2010) scenarios of transformation of global energy
systems.
METHODOLOGICAL CHOICES
Any quantification of energy security requires certain methodological

choices. Making such choices is a difficult task because of the multitude
of interpretations of energy security (see overviews in Cherp and Jewell,
2011b; Sovacool, 2011; Chester, 2009; Winzer, 2012). The two most funda-
mental methodological choices in energy security assessments are (1) the
choice between perceptions and facts in deciding what constitutes a signifi-
cant energy security concern and (2) the choice between the specific and
generic in deciding on what is the appropriate level of detail of the assess-
ment. As we explain in the next section these choices need to be made with
respect to vital energy systems, their vulnerabilities, and selection and
interpretation of indicators.
The first choice in deciding what constitutes an energy security concern
and whether such a concern is significant is between facts and perceptions.
Focusing on facts means conceptualizing energy security as an objective
property of energy systems which makes it easier to quantify and compare
(e.g. by Le Coq and Paltseva, 2009 and Gupta, 2008). This approach,
however, sometimes fails to explain the actual energy security policy
priorities influenced by such hard-to-quantify factors as history, culture,
politics and psychology.
On the other end of the epistemological spectrum are perceptions.
For example, Sovacool and Mukherjee (2011) solicit views of various
stakeholders to arrive at a set of “dimensions” and indicators of energy
security. However, stakeholders can be biased, manipulative or poorly
informed. They may either use security rhetoric or ignore obvious con-
cerns to advance their own interests. As a result, an assessment guided

Generic
Choices within an
Perceptions energy security Facts
assessment
Specific
Figure 8.1 Major methodological choices in measuring energy security

and the energy systems approach
by such a survey would risk not being policy relevant. Thus, an energy
security analyst should be aware of biases and try to reduce them while
still remaining policy relevant. Cherp (2012) argues that perceptions can
be useful in framing energy security assessments only if they are solicited
from a relevant group of stakeholders and in such a way that forces priori-
tization of various concerns.
The three case studies discussed in this chapter strive to combine analy-
ses of energy systems and insights from energy security policies to arrive
at findings that are both scientifically rigorous and reflective of policy
concerns. MOSES was conducted under the oversight of IEA member
countries and in direct and continuous dialogue with policy-makers. The
GEA analysis frames its quantitative findings with an analysis of energy
security policies. Finally, the analysis of future energy scenarios derives its
approach from the careful study of the evolution of energy security policy
paradigms over last century to distill generic concerns which can be plau-
sibly valid for the next 100 years.
The second choice is between the generic and the specific in choosing
the scope, focus and tools for an assessment. The three case-studies dis-
cussed in this chapter feature various degree of specificity. MOSES uses

approaches specific to energy supply of developed market economies.

GEA’s approach is more generic as it needs to be applicable to over 130
countries. Finally, the analysis of energy security of future scenarios needs
to deal with energy systems which are widely different from those of today
and thus uses the most generic approach of the three cases.
In summary, an effective energy security assessment is specific enough
to reflect context-specific issues and yet generic enough to enable suffi-
ciently wide comparison. Likewise, it is based on hard facts, not opinions
while still responding to perceptions and policy priorities. Finding such
trade-offs is the science and art of energy security assessments. There is no
blueprint for achieving this balance, but in all the three cases it has been
guided by an energy systems approach. This approach proceeds from the
premise that the term “energy” in “energy security” designates not a black
box with amorphous content, but rather a set of interlinked systems each
consisting of elements connected to each other and to the outside world
and each with their own sets of vulnerabilities.
Thinking in such systems terms can support methodological choices
within energy security assessments. For example, perceptions of energy
stakeholders, especially policy makers, can be structured in accordance
with three fundamental security questions: What to protect? From which
risks? And by which means? Answers to these questions reflect the way
policy makers perceive energy systems which can be related to objective
facts about them.
The energy systems approach can also support the choice between
the specific and the generic in energy security assessments. Specific
approaches developed for particular situations work better when the
assessment compares similar energy systems (e.g. the change in energy
security of a particular country from one year to another). However, the
wider the difference in energy systems that require comparison is (for
example involving many diverse countries or addressing the situation in a
distant future), the more generic the energy security assessment method-
ology should be. The range of addressed concerns may need to be wider,
the indicators more universal and their interpretation involve stronger
qualitative elements.
The methodological choices in an energy security assessment should be
systematic rational and transparent. They should reflect the configura-
tion of energy systems (real and perceived), justified based on the purpose
on the assessment and clearly explained for the intended audience. The
proposed energy security assessment framework presents an approach for
guiding such choices through several stages as explained in the following
section.

ENERGY SECURITY ASSESSMENT FRAMEWORK
The energy security assessment framework includes five stages:
1. defining energy security for the purpose of the assessment;

2. delineating vital energy systems;
3. identifying vulnerabilities of vital energy systems;
4. selecting and calculating indicators for these vulnerabilities;
5. interpreting the indicators to answer the questions posed by the
assessment.
Defining Energy Security
Because there is no universal definition of energy security (Chester, 2009;

Winzer, 2012), any energy security assessment should start with choosing
or operationalizing an appropriate definition. For example, the analysis
of energy security in future energy scenarios uses the most generic defi-
nition of energy security as low vulnerability of vital energy systems. It
covers a wide variety of situations and at the same time provides a clear
direction of operationalizing it for a specific context by narrowing down
the concepts of “vulnerability” and “vital energy systems”. The GEA
defines energy security as uninterrupted provision of vital energy services.
The focus on energy services reflects GEA’s emphasis on energy’s role in
human welfare and sustainable development. As we shall see later, the
GEA’s actual approach to measuring energy security covers not only
energy end-uses but also sources and carriers linked to those services.
MOSES proceeds from the IEA definition of energy security as the
uninterrupted physical availability at a price which is affordable, while
respecting environmental concerns. MOSES focuses only on the short-
term physical availability of energy referred to in the first part of the
definition.
Vital Energy Systems
As already mentioned, energy security is fundamentally a systemic notion.

What is secure for a particular system may not be secure for its sub-system(s)
and vice-versa. Thus, evaluating energy security entails clearly and explic-
itly defining the boundaries of the energy systems, which are being evalu-
ated. The choice of these systems is not arbitrary. In addressing the What
to protect? question, energy security policies are focused not on some
abstract “energy” but rather on protecting energy systems which are criti-
cal for societies, in other words, vital energy systems.

An early example of a vital energy system can be traced to the time when
the British Navy switched from coal to oil on the eve of the First World
War (Yergin, 1991). The first vital energy system critical for the survival of
the British Empire consisted of a fleet of navy ships and oil wells connected
by transportation lines. It formed a true system: shortfalls of oil supplies
could be replaced by oil from another source but not, for example, by coal
or wood. This explains why even though oil was a tiny proportion of the
overall energy consumed at that time it was still at the center of its energy
security concerns.
Thus, the notion of a vital energy system combines two aspects. The
term “vital” means that it is critical for the functioning and stability of a
society.1 The term “system” means that it consists of resources, materials,
infrastructure, technologies, markets and other elements connected to
each other stronger than they are connected to the outside world. From
the energy security angle, the meaning of such connections is that in the
case of a disruption the elements within a system can replace each other,
but the elements from outside the system – can’t.
Energy systems can be delineated along geographic or sectoral bounda-
ries. Various combinations of geographic and sectoral choices define a
potentially large number of energy systems (see Figure 8.2 for an illustra-
tion). Only some of these combinations making up vital energy systems
will be relevant for a particular energy security assessment.
With respect to geographic boundaries, energy security concerns are
primarily articulated at the national level.2 This is because historically it
has always been the responsibility of the nation state to protect security.
Even such supra-national entities as the IEA and the European Union
respect national boundaries by focusing on energy security of their indi-
vidual member states. Thus, MOSES focuses on national energy systems
of the IEA member countries and GEA focuses on energy security of over
130 countries.
Regional and global energy systems can also be viewed as vital by energy
security policies. An historic example is the US Carter doctrine which
called for the protection of global oil-producing regions and transporta-
tion routes because they are linked to US “vital interests” (Carter, 1980).
More recent UK and EU energy security strategies address Eurasian and
global gas markets. The Australian National Energy Security Assessment
(NESA) analyzes the global markets in liquid fuels and natural gas
(Department of Resources, 2011). State-supported Chinese investments in
overseas oil assets have been driven by concerns over the security of the
global oil market (Zhang, 2012). Bridge et al. (2012) develop an elegant
notion of the “global production networks” for the energy system encom-
passing natural gas production and trade. The GEA discusses energy

s ecurity in individual regions and analyzes the global market for interna-
tional traded fuels and the global nuclear fuel cycle.
The analysis of energy security in future scenarios (as well as earlier
studies of future energy security such as Turton and Barreto (2006) and
Costantini et al. (2007)) faces the limitation that global long-term energy
models do not have national-level resolution, instead they generate sce-
narios for a dozen or so “global regions” (for example the Middle East
and North Africa). Based on the assumption that intra-regional energy
integration and trade will likely be stronger than at present, these assess-
ments analyze energy security at the regional (as well as the global) level.3
With respect to sectoral boundaries of vital energy systems, some aca-
demic literature refers to “security of supply” drawing the systems bound-
aries around all primary energy sources. The supply-focused approach is
implicit in such generic concepts of energy security as the “4 As” (avail-
ability, accessibility, affordability and acceptability) (proposed in APERC
(2007)). Such an approach is based on the assumption that various primary
energy sources can substitute one another, which is often not the case. In
reality, different primary energy sources often have distinct vulnerabilities
which need to be analyzed separately. That is why for example Le Coq
and Paltseva (2009) analyze vulnerabilities of oil, gas and coal separately.
We already mentioned the historic focus of energy security analysis on
oil. This focus has persisted starting from early 20th century and been
fueled by such events as the two world wars4 and the oil embargoes of the
1970s. Security of oil supply clearly remains on the global energy security
agenda, however, other sources have entered the picture as well. The IEA’s
“comprehensive view of energy security” is reflected in MOSES’ analysis
of seven primary energy sources (oil, natural gas, coal, biomass and waste,
nuclear energy, hydropower and geothermal energy). The vital energy
systems addressed in the GEA are shown in Figure 8.2. They include
biomass particularly important for developing nations.
An example of a vital global energy system examined in the GEA is
the nuclear fuel cycle. The GEA analysis shows that while nuclear power
plants are constructed and maintained nationally they depend upon
supply of nuclear fuel, parts of nuclear reactors and nuclear fuel reproc-
essing organized globally. Such global systems are another example of
“global production networks” (Bridge et al., 2012).
Vital energy systems may also be structured around energy carriers
such as electricity analyzed in the GEA (Figure 8.4) and the future energy
studies. National electricity grids and power plants represent a truly
unified energy system (often backed up by international interconnections).
Electricity generation usually relies on a mix of sources so that disruptions
in one fuel can be compensated by increased input from another fuel.

Primary energy sources (PES) Carriers and End-uses

infrastructure
Domestic coal,
gas & oil
Biomass Hydro power
National
electricity
National systems
Transport,
National PES industry, R&C,
mix exports
Regional Regional
gas markets
Global
Globally traded Global nuclear industry
coal, gas & oil and fuel cycle
Note: The dotted arrow represents vulnerabilities associated with the concentration of
nuclear reactor parts, nuclear fuel reprocessing and long-term nuclear waste storage.
Source: Adopted from Cherp et al. (2012).
Figure 8.2 Vital energy systems covered in the GEA
That is why many energy security policies and studies (e.g. Stirling, 1994;
Awerbuch, 2006 and Grubb et al., 2006) address security of electricity.
Other energy carriers include oil products (diesel, gasoline and others)
and biofuels (both categories are analyzed in MOSES) or liquids fuels in
general (Department of Resources, 2011; Cherp et al., 2013).
The assessment of energy security in future scenarios faces a major chal-
lenge to delineate vital energy systems of the future which might be signifi-
cantly different from those of today. Thus, this energy security assessment
looked into primary energy sources and energy carriers which will play a
significant role in future energy systems. With respect to energy sources, it
considers tradable fuels: oil, gas, coal and biofuels. With respect to energy
carriers, it included synthetic fuels and hydrogen in addition to electricity
and liquid fuels.
Finally, end-use sectors (sometimes called “energy services”) can also
be considered as vital energy systems (an example of an analysis focused
on end-use services is Jansen and Seebregts, 2009). For example, one
energy end-use vital for all countries is transportation. In the same way as
the British Empire could not defend itself without a fleet of navy ships, a
modern society cannot function without a fleet of motor vehicles. Other

end-uses analyzed in both the GEA and the assessment of future scenarios
include the residential and commercial sector and the industrial sector.
In addition, the GEA assessment also addresses energy exports as a vital
energy system for energy exporting nations, sometimes referred to as
“demand security”.
In summary, delineation of vital energy systems for an energy security
assessment can be supported by the following checklist:
˛ Is this a true system? Are the elements within this system mutually sub-
stitutable? Can it be divided into sub-systems or merged with a larger system
without making the assessment less meaningful?
˛ Is this a sufficiently significant system in terms of its size or the population
using it or the economy it supports? Does this system support truly vital func-
tions of a society?
˛ Is there a history or plausible scenario of disruption of this system or
similar systems?
˛ Is this system consistently delineated and meaningful for all situations
covered by the assessment?
˛ Are there energy security policies or discourses that address this system?
Vulnerabilities
Vulnerabilities of an energy system are a combination of its exposure

to risks and resilience, i.e. its capacity to respond to disruptions. Some
authors only look at risks (e.g. APERC, 2007; Winzer, 2012) others focus
primarily on resilience (Stirling, 1994; 1998) whereas others (e.g. Kendell,
1998; Gupta, 2008) look at both risks and resilience. Energy security risks
differ with respect to their time-profile (shocks or stresses) and the nature
of disruptions (physical or economic). Resilience can relate to specific risks
(e.g. the presence of alternative pipelines may help to reroute gas imports
in case of problems in transit countries) or to more general risks catego-
ries (e.g. strategic storage can protect from shocks of supply caused by
political, economic or technical factors). The distinction between risk and
resilience capacities is not always observed in reality: sometimes these two
can only be analyzed in combination.
Disruptions of vital energy systems come in the form of shocks (rapidly
unfolding short-term disruptions) and stresses (slowly approaching and
longer-lasting phenomena) (Stirling, 2010). Historically the energy secu-
rity agenda was primarily shaped by shocks such as the oil crises of the
1970s, the coal miners’ strikes of the 1980s, and the disruptions of natural
gas supply and electricity blackouts of the 2000s. Stresses include unrelent-
ing demand growth, resource depletion and aging of infrastructure.
The second distinction between physical and economic risks is drawn
in a classic definition of energy security “sufficient supplies at affordable

prices” (Yergin, 2006). Whereas “sufficient supplies” is an intuitively

clear concept referring to physical risks, “affordable prices” is more of a
widely debated political construct. Policy rhetoric on this issue uses such
colorful but unhelpful terms as “reasonable”, “true”, “fair”, “affordable”,
“cost-effective” and “competitive”. A wide body of literature (among
which Keppler (2007), Greene (2010) and Helm (2002) can be especially
recommended) explores the economic aspects of energy security. An
analysis of the policy measures from the UK, Sweden and the EU shows
that despite the rhetoric their real focus (compatible with the overall idea
of energy security) is on stable and competitive prices that do not threaten
the operation of vitally important industries. Whatever the case, the exact
meaning of economic risks to energy systems should be clarified at this
stage of the assessment.
The literature proposes multiple ways to classify vulnerabilities often
dividing them into economic, political, natural, technical, military, etc.
(see e.g. Alhajji, 2008). However, in order to be useful for energy security
assessments such classifications need to be more fundamental. Indeed,
gaining insight into the causes of potential vulnerabilities of vital energy
systems requires detailed understanding of how these systems function.
This understanding needs to go beyond common sense and be rooted in
a disciplined epistemological community and armed with an effective tool
kit. Cherp and Jewell (2011b) identify three such perspectives on energy
security rooted in their own historic experience and different disciplines as
summarized in Table 8.1.
Historically, the energy security discourse emerged in the context of
military hostilities and therefore focused on risks associated with hostile
actions such as attacks on supply lines or oil fields. The risk that an adver-
sary would attack or otherwise disrupt vital energy systems has remained
high on the political agenda for the last 100 years (be it in the discourse
of the “Arab oil weapon” (Paust and Blaustein, 2008), “the Russian gas
weapon” (Baran, 2007), or in discussing possible “resource wars” between
the US and China (Klare, 2008). The notion of targeted and intentional
embargoes is now broadened and more nuanced: it includes concerns over
political extortion, political stability of suppliers or collateral damage due
to unrelated energy disputes. Nevertheless, all these concerns focus on
risks arising from foreign control over vital energy systems. As an influen-
tial UK energy security policy document puts it: “[energy security would
allow the UK to] retain independence in its foreign policy through avoid-
ing dependence on particular nations” (Wicks, 2009:8). This sovereignty
perspective on energy security analyzes risks in terms of interests, alliances,
power balances and space for maneuver as the sovereignty perspective.
The second perspective on energy security sees the origin of risks in

Table 8.1 Three perspectives on energy security
Perspective Sovereignty Robustness Resilience

Historic roots War-time oil supplies and the Large accidents, electricity Liberalization of energy systems
1970s oil crises blackouts, resource scarcity
Parent discipline Security studies, international Engineering, natural science Economics, complex system analysis
relations, political science
Key risks Intentional actions by Probabilistically predictable Diverse and partially unpredictable
malevolent agents including natural, technical and economic factors: political instability, labor
politically motivated factors. Infrastructure failures actions, terrorism, climate, economic
disruptions, political extortion and aging, extreme natural volatility etc.
156
and price manipulations events, depletion of resources,
demand growth
Resilience capacities Competitive market Emergency stocks and Diversity of energy technologies,
arrangements, diversity of redundancies, spare capacities, low energy intensity, emergency
actors, trusted suppliers and infrastructure diversity preparedeness, investent in research
reliable regimes and development, etc.
Primary protection Control over energy systems Upgrading infrastructure, Increasing the ability to withstand
mechanisms and institutional arrangements constraining demand, switching and recover from various disruptions
preventing disruptive actions to more abundant resources
Source: Modified from Cherp and Jewell (2011b).

natural and technical factors rather than in hostile or intentional human

actions. It puts at the center concerns such as aging of infrastructure,
depletion of resources, and vulnerability of energy systems to extreme
natural events. This robustness perspective has its roots in natural science
and engineering and relies on forecasts and estimation of probabilities for
risk evaluation.
The third, resilience perspective sees the origin of risks in increas-
ing complexity and uncertainty of technological, social and economic
factors affecting energy systems. It recognizes that many disruptions and
risks cannot be accurately predicted. It shifts attention from identifying
and managing risks to building resilient energy systems that are able to
respond to diverse disruptions.
Among the three assessments, MOSES has the narrowest focus on
short-term physical disruptions whereas the GEA and the analysis of
future energy scenarios cover both shocks and stresses with both a physi-
cal and economic nature. All of the assessments seek to integrate the three
perspectives on energy security though MOSES predominately focuses
on sovereignty and robustness concerns (which it classifies in external
and domestic risk and resilience factors, see Table 8.2) whereas the future
analysis in its current form only covers sovereignty and resilience con-
cerns. The list of potential future vulnerabilities (see Table 8.4) is largely
derived from the prioritization of the current vulnerabilities as identified in
the GEA (Table 8.3 and Figure 8.4) and interpreted in more generic terms
to be applicable to future vital energy systems.
As with vital energy systems, it is important to make systematic
and transparent choices of which vulnerabilities (either listed in Table
8.1 or additional ones) to include in (and which to exclude from) the
energy security assessments. The following checklist may aid identifi-
cation of vulnerabilities of vital energy systems in an energy security
assessment:
˛ Does a particular vulnerability characterize one of the vital energy systems
identified at the previous stage of the assessment?
˛ Is the vulnerability likely to cause a significant disruption to one of the vital
energy systems?
˛ Is the vulnerability addressed in energy security policies or rhetoric?
Selecting Indicators
Energy security indicators should reflect the vulnerabilities of vital energy

systems identified at the earlier stages of the assessment. They can be
selected from those suggested in the abundant literature or designed
specifically for the purpose of a particular assessment. Selection of indi-

cators should be guided by how well they represent a particular risk or

vulnerability of a vital energy system. However, an indicator is rarely a
direct measure of a risk or a resilience capacity. Rather it is a quantitative
proxy, a signal of a state of a complex and dynamic energy system. A good
analogy here is body temperature as an indicator of human health. As a
proxy it does not exactly point to the causes, nature or extent of illness
but it is still widely used and relatively reliable, especially when used in
conjunction with other observations. So are energy security indicators.
One indicator may signal the presence of several risks. For example,
import dependency may reflect the exposure to deliberate supply cuts,
disputes with transit countries, failures or sabotage of transportation lines,
or price volatility. Similarly, one vulnerability can be reflected in several
indicators. For example, the risk of blackouts may be reflected by their
historic frequency, the age of the power plants, the spare capacity, and the
diversity of electricity generation.
Some indicators can be directly found in existing statistical informa-
tion and other data sources. In most cases, however, the indicators will
need to be calculated based on available data. For example, MOSES
used data from the IEA, the World Bank and the IAEA; the GEA used
publicly available IEA and BP energy statistics as well as Platts energy
database, the World Bank, and the IAEA. The analysis of energy security
in future energy scenarios derived its data from the variables calculated
from Integrated Assessment Models such as MESSAGE and REMIND.
Calculation of indicators may use relatively simple formulas such as
the reserves-to-production (R/P) ratios or a diversity index such as the
Shannon-Weiner Diversity Index or the Herfindahl Hirschmann index.
An example of a more complex formula is the calculation of the diver-
sity of energy sources used in transport in future energy scenarios which
reflects dozens of links inside the energy system (Jewell et al., 2012).
MOSES uses 35 indicators (see Table 8.2 for a sample, the full list is
available in Jewell (2011:11) grouped into four dimensions of vulnerability
for each of the primary sources and secondary fuels.
GEA uses some 30 indicators most of which are listed in Table 8.3. In
contrast to MOSES, GEA addresses a wider range of energy systems and
vulnerabilities and thus uses less detailed but more diverse indicators. The
more general nature of the GEA indicators is also explained by the fact
that the GEA analysts did not have access to as detailed information for
all 134 countries as MOSES had for the IEA members.
The analysis of energy security in future energy scenarios used 20 global
and five regional indicators summarized in Table 8.4 (some of these are
proposed for future studies).

Table 8.2 Indicators of crude oil supply security used in MOSES
Risks Resilience
External External risks: External resilience:
● Import dependence ● Number of ports
● Political stability of suppliers ● Number of pipelines
● Diversity of suppliers
Domestic Domestic risks: Domestic resilience:

● Share of offshore production ● Domestic storage level
● Volatility of domestic production
Source: Jewell (2011).
Selection of energy security indicators may be guided by the following

checklist of questions:
˛ Is the indicator a characteristic of one of the vital energy systems?

˛ Does the indicator reflect one or more significant vulnerabilities (risks and/
or resilience capacities) identified earlier?
˛ Does the indicator provide useful information about this risk or vulner-
ability in addition to that provided by other indicators?
˛ Are there reliable data and tools (models, etc.) available for calculating
the indicator at all time points or for all situations covered by the assessment
purposes?
Making Sense of Indicators
After the indicators have been calculated, the complex journey from the
initial assessment questions to a set of numbers needs to be traced back-
wards: from those numbers to meaningful answers. The final task is to
process, interpret and communicate the indicators in such a way that they
convey accurate and relevant information cognitively accessible to the
intended audiences of the assessment. There are three interrelated strate-
gies for achieving this objective:
● interpreting individual indicators;
● reducing the number of indicators by combining them into aggre-
gated metrics;
● presenting the indicators (individually or jointly) in a format that
facilitates the assessment.
First, well-selected indicators can sometimes directly provide the
answers. For example, policy makers often use indicators such as import
dependency, R/P ratios, demand growth rates, blackout frequencies and

Table 8.3 Indicators used in the GEA energy security assessment
Energy system Energy security indicators

Shocks Stresses
Globally traded fuels: oil, gas Import dependency, cost of imports Global R/P
and coal Domestic R/C
Growth in oil consumption
Fuel intensity of GDP
Nuclear Average age of nuclear power plants
Start of last plant construction (reflecting the
capacity to replace existing fleet)
Hydro Diversity of hydro power dams
Electricity Dependency on imported fuels Electricity demand growth rate
160
Rate of access to electricity
Diversity of energy sources used in production of electricity
End-use sectors: transport, Dependence on imported fuels Demand growth rate in the sector
industry, residential and
commercial Diversity of sources and carriers used in the sector
Energy exports Revenue from energy exports as share of GDP R/P ratios of exported fuel
(reflecting exposure to price fluctuations)
National Energy Systems Overall energy import dependency Energy demand growth
Cost of energy imports compared to GDP
Cost of energy imports compared to export earnings
Diversity of PES; Energy intensity

Source: Adopted from Cherp et al. (2012).
Table 8.4 Vulnerabilities of future energy systems and related indicators
Energy systems Perspectives:

Sovereignty Resilience
Primary Total Primary Global energy trade (absolute Diversity of TPES
energy Energy Supply and relative to the total TPES) Energy intensity
sources (TPES) Net import dependency*
Oil, gas, coal, Global fuel trade
biofuels Fuel import dependency*
Regional diversity of fuel production
Carriers Hydrogen, Global trade in carrier Diversity of PES
electricity Regional diversity of carrier used in carrier
production production
Reliance on imported fuels in
carrier production*
End-use Transport, Reliance on imported fuels in Diversity of PES
sectors industry, end-use sector* used in the end-use
residential and sector
commercial Energy intensity of
end-use sector
Notes: *Regional level indicator.
Source: Jewell et al. (2012).
the age of power plants. Interpretation of individual indicators may

involve comparison between countries or different points in time or relat-
ing them to some reference values such as the baseline. For example, the
ranking of indicators for crude oil supply used in MOSES is shown in
Table 8.5. Each indicator is assigned to a band of low, medium or high
vulnerability on the basis of the indicator’s values for IEA countries.
The GEA uses simple indicators to demonstrate that oil is the most vul-
nerable among the globally traded fuels because it has the lowest global
R/P ratio, the highest proportion of international trade in global produc-
tion, the largest number of people living in countries with major oil import
dependency and the highest concentration of global production. The
assessment reaches these conclusions by comparing indicators for global
and national oil vulnerability with those for coal and natural gas.
Interpretation of individual indicators of future energy security is based
on their comparison to the present situation and other scenarios (including
business as usual development). For example, in most low-carbon scenar-

Table 8.5 Ranges of indicators for crude oil supply in MOSES
Dimension Indicator Low Medium High

External risk Import dependency #5% 40–65% $80%
Political stability of suppliers ,2.5 $2.9
Internal risk Volatility of production ,20% .20%
Share of offshore production ,5% .90%
External Diversity of suppliers .0.8 0.30–0.8 ,0.30
resilience Import infrastructure Ports 0–1 2 3–4 $5
(entry points) Pipelines 1–2 3–4 5–8 $9
Internal Storage levels #15 20–50 $55
resilience
Source: Simplified from Jewell (2011:16).
ios the global energy trade decreases in comparison to the present situa-
tion and the diversity of fuels used in the most vulnerable transport sector
increases. At the same time in the business-as-usual scenarios the levels of
global energy trade significantly rise and the diversity of transport fuels
rises much slower. This leads to a conclusion that most low-carbon energy
transition scenarios are beneficial to energy security at the global level.
In many cases, however, direct interpretation of individual indicators
is not sufficient. Policy makers often need to see an integrated picture of
energy security as reflected in several indicators. However, the more indica-
tors that come into the picture the more difficult it is to make sense of them,
especially if each tells a different story. Thus, the second strategy is aggregat-
ing indicators into energy security “indices” using one of the many methods
proposed in the academic literature (Gupta, 2008; Scheepers et al., 2007).
The rationale for such indices is that they can reduce the amount of infor-
mation and thus make the results of an assessment more understandable.
However, policy-maker’s enthusiasm for compound indices has been
varied. The problem is not that they have an aversion to aggregation as
such: in fact even the most simple, straightforward and much used energy
security indicators are already to some extent aggregated. For example,
the most widely used indicator of import dependence aggregates imports
at different periods of time (usually across a year) from different suppliers,
at different prices, by different routes and for different purposes. There is
even more aggregation involved when import dependence is calculated not
for an individual fuel or a carrier (such as LNG or gasoline) but for “oil
products”, “fossil fuels” or total “energy”.

In systematic energy security assessments energy security indicators

should be aggregated at the level of vital energy systems and their vulnera-
bilities (e.g. Le Coq and Paltseva (2009) aggregate vulnerabilities of individ-
ual fuels). If the initial identification of systems and vulnerabilities correctly
accounts for policy perspectives, policy makers are comfortable with such
aggregation, because it corresponds to their familiar boundaries of energy
systems and their ideas of vulnerabilities. If, on the other hand, the methods
of aggregation (or calculation of complex indicators in the first place)
produce a disconnect between the intuitively familiar systems and vulner-
abilities and the numbers resulting from the assessment, policy-makers
are likely to feel much less comfortable. In this latter case, the aggregated
metrics designed to make the results more understandable achieve exactly
the opposite: they complicate and obscure the message of the assessment.
Thus, any aggregation must strike a very delicate balance between on
the one hand reducing the amount of data and on the other hand staying
true to the systems and vulnerabilities which were identified as important
at earlier stages. In line with the energy systems approach, the aggrega-
tion of indicators should to the extent possible correspond to how energy
systems function. Aggregation makes more sense when the indicators
relate to the same vital energy systems and/or to vulnerabilities which can
potentially interact. For example, it may take into account how particular
risks may exacerbate one another and how particular resilience capacities
may mitigate specific risks. Such aggregation preserves the focus of the
assessment on key energy systems and their vulnerabilities and thus facili-
tates achieving the purpose of the assessment. In contrast, aggregating
indicators which relate to different and disconnected energy systems or to
vulnerabilities which reflect different perspectives on energy security or dif-
ferent types of risks and resilience capacities is usually counterproductive.
The first step of aggregation is closely connected to interpretation of
individual indicators that we discussed above. As a result of such inter-
pretation, indicators may be normalized or related to a non-dimensional
scale (e.g. ranking) making them comparable. Once indicators are normal-
ized, the methods of aggregation can be based on simple semi-quantitative
matrices as shown in Table 8.6 illustrating semi-quantitative aggregation of
two external resilience indicators for crude oil in MOSES. The aggregation
in MOSES proceeds through several similar stages until arriving at the final
results (illustrated in Table 8.7). MOSES does not aggregate results across
fuels and carriers because energy officials guiding this process perceived
that important information might be lost as a result of such aggregation.
The energy systems approach used in MOSES and GEA allows aggre-
gating not only vulnerabilities related to one and the same energy system,
but also indicates the proliferation of vulnerabilities from one energy

Table 8.6 Aggregating indicators for external resilience of crude oil

supply in MOSES
Import infrastructure
Low Medium High
Diversity of suppliers Low Slovakia Finland
Medium Ireland Sweden
High Austria Turkey Japan
Note: As a result of combining these two indicators, the countries are divided into four
groups indicated by different shades, the lighter shades indicating more resilience. One
country is listed for every group as an example.
Source: simplified from Jewell (2011:17).
system to another. For example, MOSES accounts for the aggregate secu-
rity of crude oil supply in calculating the vulnerability of oil products. The
GEA takes into account for concerns associated with individual primary
energy sources in calculating vulnerability of electricity systems and end-
uses that rely on those sources.
In the quest for an “objective” evaluation of energy security, many
studies use mathematical operations to aggregate indicators into a com-
bined index. Scheepers et al. (2007) use relatively arbitrary (but transpar-
ently defined and explained) weights to aggregate indicators throughout
the energy system into the “S/D index” for EU countries (Scheepers et al.
2007, 31). Gupta (2008) analyzes oil security by using principal compo-
nent analysis to remove correlation between indicators to avoid double-
counting vulnerabilities.
Aiming for a strictly objective evaluation of energy security is futile. All
methods for interpreting and aggregating indicators require some form of
human judgment, implicit or explicit, on the relative importance of energy
systems or their vulnerabilities. For example, in MOSES expert judgments
are used to determine the “safe” levels of risks or “adequate” resilience
capacities (see Table 8.5). Some of the aggregation methods solicit such
judgment in a more formal and sophisticated way. Badea et al. (2011) use the
idea of risk aversion to prioritize energy security concerns in cases a country
ends up at the bottom of the list with respect to a particular indicator.
Though complex manipulations of indicators can be very thought-
ful and elegant they always involve a lot of assumptions and a risk that
they might conceal rather than highlight truly important information.
Therefore if the main reason for aggregating indicators is to reduce their
number, two alternative approaches may be tried. Firstly, it is important

Gas trade versus

Electricity diversity in 2100
100
Business-as-usual
Trade volumes (EJ/year) 80
60
40
20
2010
0
0.8 1.0 1.2 1.4 1.6 1.8
Electricity diversity
Note: Different shapes and shades of the data points represent different scenarios.
Scenarios represented by lightly shaded crosses imply high energy efficiency and constraints
on renewable energy penetration.
Source: Adopted from Jewell et al. (2012).
Figure 8.3 Aggregate analysis of energy security in future energy

scenarios using a two-dimensional plotting
to ask whether all of the indicators are necessary in the first place. Do they
all tell meaningful stories? Perhaps some of them looked promising at the
stage of selecting indicators but turned out to not be sufficiently reliable
or differentiating. Perhaps the focus of the assessment was initially defined
too widely and it is necessary to exclude some systems or vulnerabilities for
the purposes of communication.
Secondly, it may be possible to present disaggregated indicators in such
a way that they are more understandable without aggregating them. For
example, instead of combining two independent indicators they can be
presented on a two-dimensional scatterplot as shown in Figure 8.3, giving
an example of analysis of future energy scenarios. The analysis does not
combine two unrelated indicators of electricity diversity and the gas trade
into a single index but instead presents the two most prominent vulner-
abilities identified in the assessment in a two-dimensional plot. It clearly
shows that low trade and high diversity (the optimal conditions for energy
security) are only possible in certain scenarios.
There are other techniques for visualizing multiple numerical data
which can be successfully used in communicating assessment results. Since
energy security is very much about context and perceptions it is useful
to consider methods of communication which have a clear qualitative
aspect such as narratives or visuals. For example MOSES summarizes

Table 8.7 Results of the crude oil analysis for MOSES
Group Countries that: No. of

countries
A Export crude oil or import #15% of their crude oil 5
consumption.
B Import 40–65% of their crude oil consumption or 4
Import $80% of their crude oil consumption and have
● $5 crude oil ports, high supplier diversity and $55 days of
crude oil storage.
C Import $80% of their crude oil consumption and have: 9
● $5 crude oil ports, high supplier diversity, and ,50 days
of crude oil storage or
● 2–4 crude oil ports, high supplier diversity and .20 days
of crude oil storage.
D Import $80% of their crude oil consumption and have: 6
● 2–4 crude oil ports, high supplier diversity, and #15 days
of crude oil storage or
● 2 crude oil ports or 3 crude oil pipelines, low supplier
diversity, and $15 days crude oil storage or
● 1–2 crude oil pipelines or 1 crude oil port and have either:
❍ medium to high supplier diversity and $15 days of
crude oil storage or
❍ low supplier diversity and $55 days of crude oil storage.
E Import $80% of their crude oil consumption and have: 3
● 1–3 crude oil pipelines or 1 crude oil port and #15 days of
crude oil storage or
● 1–2 crude oil pipelines, low supplier diversity and ,50
days of crude oil storage.
Source: Jewell (2011:18).
its results in terms of “profiles” of energy security of individual countries

which together form a “landscape” of energy security in the IEA Member
Countries. The terms “profile” and “landscape” convey clear qualitative
images. The results of MOSES convey holistic stories about countries
(divided into groups according to their vulnerability profiles) as shown in
Table 7 for the case of crude oil.
The GEA messages are also expressed in a narrative and qualitative
form. Thus GEA summarizes one of its main messages as follows (note
how quantitative indicators and depiction of energy systems which span
end-uses and primary energy sources are woven into the narratives):

Oil is at the center of contemporary energy-security concerns for most

nations, regions, and communities. Oil products provide over 90% of trans-
port energy in almost all countries. Thus, disruptions of oil supplies may
have catastrophic effects, not only on personal mobility, but also on food
production and distribution, medical care, national security, manufacturing,
and other vital functions of modern societies. At the same time, conventional
oil resources are increasingly concentrated in just a few regions. The concerns
over political stability affecting resource extraction and transport add to
uncertainty. Moreover, the global production capacity of conventional oil is
widely perceived as limited. Furthermore, the demand for transport fuels is
steadily rising, especially rapidly in emerging Asian economies. Thus, for most
countries, an ever higher share of their oil, or even all of it, must be imported.
More than three billion people live in countries that import more than 75% of
the oil and petroleum products they use. An additional 1.7 billion people live
in countries with limited domestic oil resources (including China) which are
likely to experience similarly high levels of import dependence in the coming
decades.
In summary, interpretation of indicators can use the following

approaches:
˛ Individual indicators may be interpreted by comparing them across the

systems (or points in time) covered by the assessment or with meaningful
reference values;
˛ Several indicators may be aggregated into a compound index. Such
aggregation makes sense if it:
● Combines indicators related to systems or vulnerabilities that poten-
tially interact with or affect each other;
● Uses techniques which reflect such interaction;
● Does not obscure or conceal important choices and trade-offs that are
meant to be highlighted by the assessment.
˛ Other methods for making sense of a large number of indicators and data
points include various visual techniques and qualitative narratives;
˛ Subjective judgments are an inevitable part of interpreting indicators and
should be made in a transparent way consistent with the overall purpose of the
assessment.
CONCLUSIONS
This final section recaps the main messages of the chapter and outlines
the agenda for further development and application of the energy security
assessment framework. In contrast to the mainstream tradition the frame-
work does not place indicators at the center of measuring energy security.
Instead it focuses on how to make transparent and informed choices
at five distinct stages of an energy security assessment as schematically
shown at Figure 8.4.

Generic vs. Specific
Energy systems approach
Delineating Interpretation
Operational Identifying Selecting
vital energy and
definition vulnerabilities indicators
systems communication
Energy systems approach
Facts vs. Perceptions

Figure 8.4 Energy security assessment framework
The first set of choices reflects the idea that energy security is as much
about perceptions as it is about the hard realities of energy systems.
The second set of choices reflects the fact that energy security is a highly
contextualized characteristic of energy systems which nevertheless should
be rendered generic for the purpose of comparison. A good assessment
strikes the right balance between these major choices at each of its five
stages:
● At the first stage, it selects a definition of energy security acceptable

to the audience of the assessment and sufficiently operational with
respect to all energy systems analyzed.
● At the second stage it delineates vital energy systems, in a manner
that is meaningful and consistent for all points of comparison, with
reference to both policy concerns and the realities of energy flows.
● At the third stage, it identifies the vulnerabilities of these vital
energy systems. Existing policy concerns are a good starting point,
however, human perception of risks can be severely biased towards
higher-profile, particularly dreaded events, especially resulting from
actions of hated adversaries rather than “Acts of God”. This bias
may need to be adjusted by an objective analysis.
● At the fourth stage, it selects energy security indicators that reflect
(but not necessarily measure!) the identified vulnerabilities. It
is usually easier to start with the metrics already used in policy-
making because (a) they will be more familiar and easier to interpret

and communicate; and (b) there will usually be data available for
such metrics. More complicated calculation and data mining may
be required to obtain indicators for vulnerabilities which for one
reason or another are not on the political agenda. Such complex
indicators will also require more efforts to interpret and communi-
cate. While indicators should be relevant for a particular situation,
they should also be comparable across all situations covered by the
assessment.
● At the fifth and final stage, the indicators are interpreted and pre-
sented in a form that facilitates answering the original questions
posed by the assessment. This may require aggregating indicators
quantitatively into compound indices or qualitatively into narra-
tives. Perspectives of the audiences of the assessment need to be
taken into account in this process. They should, however, not distort
the rigor of the assessment or obscure its main messages.
As indicated in Figure 8.4, the energy systems approach helps making

informed choices at each stage of the assessment. It means that at every
stage analysts should work not with a black box of amorphous “energy”
but with actual energy systems. Vital energy systems should be deline-
ated based on an understanding of energy flows and their significance for
societies. Vulnerabilities should be identified based on how energy systems
might respond to disruptions. Indicators are selected based on their abili-
ties to serve as proxies for such complex system behavior. Finally, indi-
cators should be interpreted, processed and presented to reflect the way
actual energy systems function.
This chapter illustrates the application of the proposed framework in
three case studies summarized in Table 8.8. Despite the fact that all the
studies make different choices about the definition of energy security, vital
energy systems, key vulnerabilities, indicators and approach to their inter-
pretation they all systematically move through the five stages and apply
the principles of the energy systems approach.
There are several ways in which the proposed framework can be further
developed and used. This research agenda can also be structured in line
with the key stages of the assessment, as follows. There should be better
understanding of different types of vital energy systems; for example, more
research is needed to understand the vulnerabilities of nuclear energy,
renewable energy sources and traditional biomass. There should be better
methods to explore vulnerabilities of vital energy systems, for example
through researching their reaction to possible disturbances in dedicated
modelling exercises. Based on this understanding new indicators of energy
security may be developed, e.g. based on indicators used to characterize

Table 8.8 Cases of energy security assessments presented in this chapter
Energy security assessment IEA model of short-term Global Energy Assessment Future energy security
energy security (MOSES) (Energy and security chapter)
Scope and purpose Develop energy security Identify the most prominent Examine energy security
profiles of 28 IEA energy security challenges at implications of long-term
countries present and in the near future energy transition scenarios
affecting the world as a whole
(134 countries)
Vital energy systems
Geographic and National Global and national, qualitative Global and regional
political boundaries regional discussions
Sectoral boundaries Seven primary energy Primary energy sources, Globally traded fuels and
sources and secondary electricity, key end-uses carriers, electricity, selected
170
fuels end-uses
Vulnerabilities Short-term physical Stresses and shocks both physical Primarily physical shocks and
disruptions and economic stresses, sovereignty risks and
resilience factors
Indicators 35 indicators 34 indicators 20 global and five regional
indicators
Interpretation and Comparative ranking Narratives to describe the most Narratives to describe the
aggregation method between IEA countries, significant vulnerabilities dynamics of future energy
then semi-quantitative security
aggregation to characterize
their “energy security
profiles” and the IEA

“energy security
landscape”
resilience of ecological systems and social networks. In order to make

sense of the new and existing indicators, large and consistent data sets will
need to be created spanning a range of energy systems and time points
for monitoring and comparison. Energy security assessments should go
hand in hand with developing a toolkit for energy security policy analysis,
in which policies and vulnerabilities of energy systems are understood as
interacting and co-evolving.
NOTES
1. This is in line with the classic definition of the objective of energy security by Daniel
Yergin (1988:112): ‘The objective of energy security is to assure adequate, reliable sup-
plies of energy at reasonable prices and in ways that do not jeopardize major national
values and objectives.’ (emphasis added)
2. It is also not uncommon, especially for larger countries, to address energy security of
sub-national regions (e.g. regional electricity grids in Sweden or the US or regional gas
markets in Australia).
3. In the case of some regions this approach is a good proxy of assessing national energy
security. This concerns highly integrated and homogenous regions (e.g. the European
Union) and those that are dominated by a single major country (e.g. North America by
the US, South Asia by India and Centrally Planned Asia by China). In other cases such
as Africa, Latin America and the former Soviet Union the results of the assessment using
this method are likely to be very different from an assessment from national perspectives
which unfortunately cannot be conducted when dealing with long-term radical energy
transformation scenarios.
4. We have already mentioned the importance of crude oil for the British Navy in World
War I. The importance of oil products for the USSR during the World War II is vividly
described by (Matvejchuk, 2012).
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9. National energy strategies of major
industrialized countries
Stephan Schott and Graham Campbell
1 INTRODUCTION
Energy security in major industrialized countries has traditionally been

concerned with securing the supply of particular energy commodities at
reasonable cost. For many countries, this has meant a secure supply of
fossil fuels in order to support a manufacturing base, to enable increasing
living standards based on large centralized electricity grids, and to support
fossil fuel based transportation systems. Energy strategies, therefore, typi-
cally consisted of ensuring availability of energy commodities and avoid-
ing disruption to energy supplies. This situation has drastically changed
in the last two decades as a consequence of the integration of the former
Eastern bloc countries into Europe, the ever more visible threat of climate
change, new emerging global energy suppliers like Norway, Australia,
Canada, China and Russia, and new rapidly growing large scale energy
consumers like China and India, which greatly expand opportunities for
sale of primary energy commodities to meet their rapidly growing demand.
More recent energy strategies are more concerned about securing the
supply of energy services, rather than energy commodities per se, moving
towards a more diverse suite of energy generation sources, such as nuclear
energy and renewable energy technologies. There is a growing trend in
weaving energy strategies with either economic development strategies (as
in the case of Russia and Norway), economic, regional development and
industrial strategies (as in the case of Canada, Australia and Norway), or
climate change policies (as in the case of the European Union). Certain
industrialized countries illustrate this broadened interest in energy secu-
rity. For example, the United States is trying to rely more on domestic
or secure energy supplies and sees energy security as an employment,
innovation and economic rejuvenation strategy. Exporting countries, such
as Norway, Russia, Canada and Australia, recognize the importance of
energy exports to their long-term economic development prospects.
Our approach to examining developments in energy strategies is to
select a suite of industrialized countries, which are characterized on the
basis of their import/export dependence in primary energy commodities.
174

National energy strategies of major industrialized countries 175
Countries can be characterized under this approach as being: net energy

exporters, concerned primarily about the security of demand for their
commodities (such as Russia, Norway, Australia and Canada); countries
that are both importers, say of crude oil, but are also emerging as major
exporters, in part due to recent technological advancements (such as
Canada as a result of advancements in oil sands technologies, potentially
the EU with a more integrated electricity grid and the United States due to
the recent progress in shale gas extraction); and countries which are almost
totally reliant on limited domestic production and a major share from
imports for their energy supplies (as is the case in Japan). Countries can
change from one category to another suddenly. For example, a natural
gas revolution (Voser 2012) arising from the exploitation of gas resources
in shale formations, has changed the global supply-side picture dramati-
cally, facilitating the potential of establishing a global natural gas market
featuring new players.
Many international institutions such as the IEA, the G8, the G20 and
many others are addressing energy security issues. But recent failures in the
world financial systems and the Euro crisis question the ability of world
institutions to coordinate actions and to successfully implement common
objectives. Furthermore existing institutions need to be overhauled and
strengthened to secure energy flows between net exporters and importers
(Goldthau et al. 2010). As a result there have been calls for a new institu-
tion, an Energy Stability Board similar to the Financial Stability Board
(Victor and Yueh 2010).
On a more limited scale, the G8 countries declared seven principles of
energy security in St. Petersburg in 2006, and annually measure progress
for each G8 country. The principles are aimed at increasing transpar-
ency, predictability and stability of global energy markets, improving
the investment climate in the energy sector, enhancing energy efficiency
and energy saving, diversifying energy mix, ensuring physical security of
critical energy infrastructure, reducing energy poverty and at addressing
climate change and sustainable development. In the latest G8 Summit at
Camp David (The White House 2012a) the countries agreed to pursue a
comprehensive energy strategy that focuses on safe, efficient and environ-
mentally sustainable development of a mix of energy sources. The action
plan also encourages the facilitation of access to energy resources in order
to enhance energy security, decrease price volatility and to provide for a
favorable investment climate in the energy sector. The G8 also promote
the sustainable deployment of renewables and addressing climate change
by reducing short-term pollutants.
Each of the selected countries, with the exception of Canada, has devel-
oped a long-term national energy strategy with their own particular focus

and characterization of energy security. In this chapter, we examine the

structure of national energy strategies in the G8 countries and Norway,
and evaluate and contrast different components of individual strate-
gies. We chose Norway in addition to the G8 countries because of its
unique strategic position in Europe and the Arctic and its progressive
views on many environmental and energy related polices. We hope to
contribute to the better understanding of the importance and meaning of
national energy strategies, differences in the definition of and approach
to energy security, and the compatibility of strategies with the emerg-
ing world energy order. We start by assessing current energy mixes and
flows (imports and exports) of these major industrialized countries. We
then discuss stated energy strategies in all these countries and regions and
contrast them with respect to a number of identified criteria. We examine
future desired energy profiles and the role of trade links and markets, and
the role and definition of energy security in each case. Finally we analyze
the compatibility of energy strategies and the potential for national,
regional and global energy security.
2 CURRENT ENERGY MIX AND IMPORT

DEPENDENCE
The countries referenced in this chapter are among the leading global
industrialized nations. Each country’s perspective on the issue of energy
security is influenced by the national situation for supply and demand for
the principal energy commodities. We examine the picture for energy secu-
rity from the standpoint of countries characterized by security concerns
dominated by supply of energy commodities, and those concerned about
the security of demand for their energy commodities from foreign markets
(see Table 9.1).
Countries with a rich resource base are more likely to be economi-
cally dependent on the sale of their energy commodities into foreign
markets; exceptions are countries which have large unsatisfied domestic
energy demand arising from a large population with increasing expec-
tations for energy services, such as China and India for example. The
export-dependent countries typically orient their energy security strate-
gies to developing indigenous resources to maintain export revenues. For
example, Norway exports over 89 per cent of its oil and gas production to
markets in Europe. Other countries have a more balanced picture between
exports and imports, and their energy security strategies will be concerned
with both domestic supply issues and foreign demand issues. While the
economic development and growth of these countries is dependent on

Table 9.1 Export-import dependence of selected countries
Country Coal Crude Oil Natural gas

Exp/ (prod 1 Imps) Exp/ (prod 1 Imps) Exp/ (prod 1 Imps)
High Export Dependence
Norway 71% 80% 94%
Balanced Export-Import Dependence
RU 41% 51% 28%
CA 42% 51% 52%
AU 76% 34% 39%
High Import Dependence
EU 7% 8% 14%
US 6% 1% 4%
JA 1% 0% 0%
Source: International Energy Agency (2009).
sales of energy commodities into foreign markets, these countries also face
issues around domestic security of supply. Russia, Canada and Australia
are in this situation.
Countries, which rely on domestic production and imports to support
their economic development and growth, are primarily concerned with
energy supply issues, lacking a significant export trade in energy com-
modities. The high level of dependence on imports is expected to result
in a dominant focus on security of supply issues in the formulation of
their energy strategies. We will evaluate national energy strategies in more
detail next and will assess the driving factors of energy security issues.
3 FEATURES OF NATIONAL ENERGY

STRATEGIES: A COMPARATIVE APPROACH
3.1 Australia
A balanced, commodity-dependent import/export picture characterizes

Australia (Table 9.1). Australia enjoys a significant resource endowment
in important energy commodities: oil, gas, and coal. Coal resources,
located primarily in the southeast quadrant, are a major export commod-
ity, that contribute a significant share of Australia’s export revenue (31 per
cent of total national export revenue). Natural gas markets are well estab-
lished in the southeast, southwest, and northwest quadrants; LNG exports

Table 9.2 Characteristics of national energy strategies in countries with

high export and balanced export-import dependence
Country/ Energy Strategy Focus of Energy Components of Definition of

Region (Name and Strategy Energy Strategy Energy Security
Date)
Australia Draft Energy To build a Priority areas: Adequate,

White Paper: secure, resilient (1) strengthening reliable and
Strengthening and efficient the resilience competitive
the Foundations energy system of Australia’s supply of
of Australia’s that: energy policy energy to
Energy Future (1) provides framework support the
National accessible, (2) reinvigor- nation’s
Energy Security reliable and ating the energy economic
Assessment competitively market reform and social
2011 priced agenda (markets development
energy for all and energy
Australians productivity)
(2) enhances (3) developing
Australia’s Australia’s
domestic and critical energy
export growth resources –
potential particularly
(3) Delivers Australia’s gas
clean and resources
sustainable (4) accelerating
energy clean energy
outcomes.
Norway For petroleum, For petroleum For petroleum, Open and

an industry (includes oil and (1) improved transparent
for the future gas), to ensure recovery from world markets
– Norway’s the profitable existing fields, with clear
petroleum production of (2) development price signals
activities oil and gas in of discoveries (Norwegian
(Report: white a long-term not yet on Minister of
paper for the perspective, to production, Petroleum and
Norwegian improve the (3) proving up Energy, Ola
Parliament) quality of life undiscovered Borten Moe in
in Norway for resources, in a speech in the
years to come. areas open for U.S. in March
For electricity, exploration now, of 2012)
increase ability and in areas to
to manage be opened in the
near future

Projected Institutions Flexibility/ Reliance on Reliance on int.

Energy Governing Adaptability unconven- cooperation/
consumption Energy tional markets
mix Coordination/ energy
Strategy sources
Total energy For Periodic Recent For security of
produced: Commonwealth situation development supply, relies
18,000 PJs in government: and policy of coal entirely on
2011 to 43,000 Department reviews, and seam gas international
PJs in 2035 of Resources, assessments. in Victoria, oil market,
Coal: Energy and Sound offshore gas with concern re
10,500 PJs in Tourism, awareness of production implications of
2011 to 18,700 Energy Security global and well- future political
PJs in 2035 Council (to be domestic established instability and
(93% exported) created) – developments (since 1989) future price
Natural Gas: For States: and trends. on NW shelf. increases.
2400 PJs in Territories: Largely self- For security of
2011 to 8,300 their ministries, sufficient foreign markets,
PJs in 2035 own resources, in energy relies on Asia
(67% exported) responsible for resources, for purchases of
Uranium: production, other than coal, Uranium
3,200 PJs transport, land- crude oil and and LNG,
in 2011 to use, mineral products. expecting very
14,500 PJs in rights, and Expectations large growth in
2035 (100% environ-mental for large sales between
exported) assessments. growth in AU’s now and 2034–
(Department exports of coal, 2035 (coal to
of Resources, uranium and double, natural
Industry natural gas. gas by five times)
and Tourism
(2011))
Oil: Ministry of abundant Unconven- Norway derives

2.1 mbopd in Petroleum and potential tional the bulk of its
2009 to 1.2 Energy oil and gas resources are national revenue
mpopd in 2030 resources not being from sale of
(90% exported) underlying pursued in oil and gas
Gas: the northern Norway. The production to
130 Bcmpd in shelf and in the focus is on western Europe
2009 to 130 far Northern exploration and the UK.
bcmpd in 2030 offshore. Also, and develop- This source
(95% exported) revenues from ment of of revenue is
Ministry of development conventional seen as the key
Petroleum and of offshore offshore economic factor
Energy (2011) natural in Norway’s
gas resources future. In this
will offset sense, “energy
security” in

Table 9.2 (continued)
Country/ Energy Strategy Focus of Energy Components of Definition of

Region (Name and Strategy Energy Strategy Energy Security
Date)
Norway shortfalls in For electricity,

supply from (1) increase
hydropower share from other
in times of renewables
low reservoir (primarily wind)
capacity. (2) improve
Strong reliability and
commitment to resilience of
energy efficiency. electricity system
Russia Energy Strategy Creation of (1) Energy National

for the Period innovative and security security,
up to 2030 efficient energy (2) Energy ability to
(Ministry of sector, meeting efficiency withstand
Energy 2010) foreign economic (3) Budget threats to
interests, socio- efficiency of the reliable supply
economic energy sector of fuel and
development (4) Environmen- energy and
objectives tal safety of the threats caused
energy sector by external
factors
(geopolitical,
macro-
economic and
market)
Canada n/a n/a n/a Global energy

security with
a free choice
of energy
mix (Foreign
Affairs and
International
Trade,
Canada)


consumption Energy tional markets
mix Coordination/ energy
Strategy sources
the ongoing oil and gas Norway means
decline in resources. secure access to
revenues from European and
oil production. UK markets,
supported
by pipeline
infrastructure.
For electricity
supply, Norway
relies on imports
from the
neighbouring
countries via
the NordPool
electricity
market.
2030: Ministry Built-in Not a strong Stability of

46% Nat. Gas of Energy, adjustment of focus foreign demand,
22% Liquid Institute development security of transit
fuels of Energy paths
18.5% Solid Strategy
fuels
13% Non-fuels
Federal Limited Oil sands Heavy reliance

Minister flexibility due and shale on international
of Natural to provinces’ gas explora- markets
Resources, authority over tion in some particularly the
Council of the energy policy provinces U.S. market,
Federation, (mora- strong urge to
National torium on diversify market
Energy Board, shale gas in access
Canadian Québec)
Nuclear Safety
Commission

make up a growing share of national export revenue, originating from the

Northwest shelf in 1989, and more recently from the development of coal
seam resources in the southeast quadrant. As domestic oil production
dwindles, Australia is becoming progressively more reliant on imports,
largely through the Singaporean transportation corridors.
Given the importance of energy commodities to the national economy,
Australia has periodically developed an energy strategy, supported by
a national assessment of energy security risks associated with each
primary energy commodity. Most recently, the draft Energy White
Paper has been issued and is entitled “Strengthening the Foundations
for Australia’s Energy Future” (Department of Resources, Energy and
Tourism, Government of Australia 2011), complemented by the most
recent National Energy Security Assessment (December 2011). Taken
together, these documents provide an objective, comprehensive picture of
how Australia is coming to grips with energy security issues. Four priority
areas are explored in depth in the draft Energy White Paper: resource
development to meet both domestic needs and to benefit from providing
primary energy commodities to the export market; the safe and sustain-
able development of energy resources through community engagement
and proper environmental regulation of resource development activities
and management of competing pressures associated with diverse, multi-
ple interests; investment across the energy supply chain in new and aging
infrastructure; and prudently addressing the increasing energy costs which
arise from investments in new energy technologies and infrastructure and
which directly affect consumers and industry alike.
The objectives of the energy security framework are to ensure an
adequate, reliable and competitively priced supply of energy to support
Australia’s ongoing economic and social needs. The White Paper lists
several factors which have a direct bearing on Australia’s energy secu-
rity: the ability to efficiently and sustainably develop energy resources;
domestic and global political conditions which influence the operation
of international energy markets and financial markets; the efficiency and
robustness of domestic and international energy markets; the degree of
integration with international energy markets and supply chains; and the
impact of domestic and global energy prices.1 The policy framework has
seven key elements:
1. promoting timely and efficient development of Australia’s energy

resources and developing robust energy markets that provide reliable
and efficient supply-side and demand-side outcomes;
2. ensuring effective and resilient governance and regulatory institutions
with effective and transparent market monitoring arrangements;

3. ensuring energy and related resource policies are appropriately and

efficiently integrated with climate change and other environmental
policy frameworks;
4. developing new generation and end-use technologies to improve per-
formance (including environmental outcomes), diversify the energy
system and reduce critical dependencies;
5. providing a stable, attractive and open economy that facilitates inter-
national trade and investment;
6. undertaking effective international engagement and collaboration
with key trading partners; and
7. international energy organizations.
3.1.1 National Energy Security Assessment

The Energy White Paper is supported with the outcomes from the peri-
odic National Energy Security Assessment (NESA), most recently issued
in December 2011 (Department of Resources, Energy and Tourism,
Government of Australia 2011). With respect to particular energy com-
modities, Australia has analyzed the overall risks and opportunities
associated with crude oil, natural gas, and electricity. Each commodity
is given a categorization of the security risks (high security, moderate
security, or low security2) over three time periods (2012, to 2016, and to
2035). The assessment of Australia’s security in liquid fuels indicates high
security with respect to adequacy and reliability through the medium term
of the analysis, and moderate security throughout the analysis period due
to uncertainties in global oil prices, in part due to pressures from growing
international demand for oil and higher production costs associated
with new sources of supply. Natural gas security is rated as moderate for
adequacy and reliability3 through 2018. Affordability ranges from moder-
ate in the short term, due to the current market situation where supply
is adequate at moderate market prices, to low in 2018 due to anticipated
tighter domestic supply conditions and completion between domestic and
international market prices as the global market for LNG expands in the
near future.
An interesting component of the security assessment is consideration of
the role of critical infrastructure and cyber security. As noted in the NESA
2011, “. . . the rise of more interactive and technology-connected energy
systems creates an emerging area of vulnerability through cybersecurity
threats.”4 Cyber security threats are rated as moderate in keeping with
the experience gained through known cyber security incidents and the
fact that there is a growing concern for further vulnerabilities to attacks
from remote sites since proximity is no longer a requirement to cause
interruptions to energy supply or damage to infrastructure.

The global energy scene is characterized by ever more rapid changes,

which could arise as a result of political upheavals, the deployment of new
energy technologies which permit access to previously-untapped compo-
nents of the resource base, or new policies which are developed to address
environmental needs or market failures. As a result, energy security poli-
cies should be kept under constant review by governments so that updated
assessments can be issued frequently. The Government of Australia has
committed to undertaking four-year strategic reviews of national energy
policy, starting in 2016, and to a biennial national energy security assess-
ment starting in 2014. In addition, and in clear recognition of the divided
responsibilities for energy matters in Australia, the Commonwealth gov-
ernment of Australia will undertake a risk preparedness audit of the coun-
try’s energy sector, in collaboration with the six states and territories, with
industry, and with energy market bodies. With respect to the outlook for
domestic consumption of energy commodities, Australia foresees steady
growth in domestic use of natural gas, matched by gradual decline in use
of coal, and significant decline in domestic oil production.
3.2 Norway
The energy security situation in Norway differs significantly from the

other countries selected for study in this chapter. Norway is one of the
world’s leading energy suppliers, based on its rich endowment of oil
and gas resources, which are the source of current and future petroleum
production. Due to its secure and reliable source of petroleum, Norway
provides a significant contribution to the security of supply for countries
in Western Europe and to the UK.
Fields developed to date are located in basins beneath its quadrant
of the North Sea and in the southern offshore areas. Norway’s overall
energy production is dominated by oil (52 per cent) and gas (41 per cent)5
(International Energy Agency 2011). Geological assessments have indi-
cated significant undiscovered oil and gas resources beneath the central
and northern offshore areas, and farther north adjacent to the islands of
Svalbard. These resources position it to be a major oil and gas supplier for
decades to come. The bulk of Norway’s petroleum production is exported
to Western Europe and the UK; 80 per cent of oil production and 94 per
cent of natural gas production (see Table 9.1). Globally, Norway is the
third largest oil exporter, after Saudi Arabia and Russia.
The revenues from petroleum exports contribute a correspondingly
large share to Norway’s total revenues: 22 per cent of national value
creation6 in 2009 (Norwegian Petroleum Directorate 2010). The reliance
on petroleum export revenues as the basis for Norway’s economic future

means that “energy security’’ translates into continuation of long-term oil

and gas production, the availability of secure and reliable infrastructure
for transportation of production to foreign markets, and open and secure
access to foreign markets without import barriers and at international
prices.
3.2.1 Norway’s strategies for maintaining and growing petroleum

production
Norway recognizes that production from oil fields is currently declining,
and that there is a significant opportunity to increase natural gas produc-
tion in the future. According to data from the Ministry of Petroleum and
Energy, oil production peaked in 2001 at 3.3 million barrels of oil per day
(mbopd) and had declined to approximately 2.1 mbopd by 2011; projected
production by 2030 is 1.2 mbopd (International Energy Agency 2011).
The situation for natural gas is an increasing trend, from approximately
26 billion cubic metres (bcm) in 1985, to 105.9 bcm in 2009; with projec-
tions to up to 130 bcm by 2020 depending on the timing of new production
projects (International Energy Agency 2011). Norway’s strategy to ensure
continuation of this favorable, export-oriented situation for petroleum has
key elements aimed at sustaining oil production and growing natural gas
production over the long term. In brief, the elements are:
1. improved recovery from existing fields based on tapping undeveloped

reserves;
2. development of discoveries not yet on production; and,
3. proving up undiscovered resources, in areas open for exploration
now, and in areas to be opened in the near future.
3.2.2 Electricity: security of supply

In contrast to Norway’s strong situation as an energy supplier of oil
and gas, the situation is dramatically different for electricity generation.
Norway obtains over 96 per cent of its electricity from its hydropower
facilities (International Energy Agency 2011), a very favorable situation
with respect to clean energy generation. However, the amount of gen-
eration is directly dependent on reservoir capacity; fluctuations in rainfall
and reservoir inflow result in significant year-to-year variations in annual
generation. “Since 2000, hydropower generation has ranged from a low of
106 Twh in 2005 to an all-time high of 140 Twh in 2008.” (International
Energy Agency 2011) Norway is addressing this electricity security issue
through actions by the country’s transmission system operator, Statnett,
which uses market-based practices and back-up generation to ensure suf-
ficient supply and power quality. The first recourse is to draw on the Nord

Pool spot market, based on the quantities and prices available at that time.
Statnett attempts to have access to at least 2000 MW of capacity in the
balancing market every hour. If the bids from producers and consumers
in the balancing market are insufficient to meet peak power requirements,
Statnett can conclude contracts for reserve capacity with producers and
power consumers so that a prudent balance can be maintained. Lastly, the
TSO also has two mobile gas turbine plants (150 MW capacity) to provide
reserve generation capacity (International Energy Agency 2011).
Looking ahead over the long-term, Norway’s security strategy with
respect to electricity is intended to address the country’s vulnerability to
fluctuations in reservoir levels, and stresses:
1. an increased share from other renewables (primarily wind);

2. improving reliability and resilience of the electricity system.
3.3 Russia
Russia’s latest energy strategy is documented in great detail in “Energy

Strategy for the Period up to 2030” (Ministry of Energy of the Russian
Federation 2010). Its main objectives are the effective use of natural
resources, the potential of the energy sector to sustain economic growth,
and to strengthen the foreign economic position of the country. Russia
aims to create an innovative and efficient energy sector that meets foreign
economic interests and socio-economic development objectives. The
national energy strategy identifies three implementation phases. The first
phase (that is supposed to end between 2013 and 2015) aims to over-
come the economic and energy crisis in the country. It is also recognized
as a renewal phase and an opportunity to modernize the Russian fuel
and energy complex. In the second phase (2016–2020/2022), an array of
cutting-edge, highly efficient innovations and technologies are to be intro-
duced: greenfields are to become operational and new capital-intensive
energy projects in Eastern Siberia and Far East, on the continental shelf
of the Arctic seas and the Yamal peninsula are to be fully operational. The
latter projects are supposed to be implemented in the first period. In the
final period of 2021/2023–2030, considerably improved energy efficiency
coupled with enhanced use of non-fuel energy sources (nuclear, solar,
wind, etc.) are expected to gradually transition Russia’s energy sector
and economy. The state is supposed to have an important role in guiding
investments and steering the economy in the right direction (Ministry of
Energy of the Russian Federation 2010).
It seems somewhat surprising that energy security is the first of the
four main strategic components of the energy strategy. Energy security is

defined as being provided and determined by resource sufficiency, as well

as economic availability and ecological and technological acceptability
of energy sources. Resource sufficiency refers to the deficit-free supply
of energy to the Russian population. Economic availability relates to the
profitability of energy supply and the determination of appropriate market
prices. The Russian energy strategy is concerned about improving energy
efficiency and energy conservation and aims to utilize market signals to a
larger extent. Russia also realizes, however, that there are ecological and
technological limits that need to be respected to guarantee operational
safety of energy facilities and to meet environmental standards.
Russia also has experienced regional disparity in energy supplies, a
high degree of fixed asset depreciation and low levels of investments in
the fuel and energy complex. The national energy strategy, however, real-
izes Russia’s heavy dependence on natural gas and natural gas markets
in Europe and Asia. Energy security is, therefore, also expressed as the
ability to withstand threats to reliable supply of fuel and energy and
threats caused by external factors (geopolitical, macroeconomic and
market). Russia aims at strengthening partnership with the leading energy
producers and developing active dialogue with the consumers and transit
countries in accordance with the principles of energy security adopted by
the G8 Summit in Saint Petersburg in 2006 (Shadrina 2010). The other
three major components of the energy strategy are the improvement of
energy efficiency in all sectors, budget efficiency of the energy sector to
become more competitive with world markets and environmental safety
of the energy sector. Budget efficiency refers to the predictability of public
revenues from business entities of the energy sector and necessary state
investments to further develop the energy sector.
Russia predicts a reduction in the share of natural gas in the primary
energy consumption from 53 per cent in 2008 to 46 per cent in 2030.
This will be offset with an increase in the proportion of liquid fuels and
non-fuels. Energy exports are expected to rise by around 13 per cent over
2008 figures and natural gas exports to far-abroad countries are estimated
to rise by 65 per cent (Ministry of Energy of the Russian Federation 2010).
Based on these figures Russia is still planning to be a fuel-based energy
exporter in 2030. It is, of course, very uncertain what the political and
economic situation in 2030 will be. Since the energy strategy was crafted
we have already seen drastic changes in the world energy situation. The
natural gas revolution might result in world markets for natural gas
similar to the trade in oil, particularly if countries invest into liquefied
natural gas terminals and other continents develop production from shale
gas reservoirs on a larger scale. The Russian economy needs to be flex-
ible and cannot just count on the current trade in natural gas based on a

2030 (predicted)
Non-fuel 2008 (actual)
Solid fuel
Liquid fuel
Gas
0 10 20 30 40 50 60
Source: Ministry of Energy of the Russian Federation (2010).
Figure 9.1 Russia’s primary energy consumption by fuel as a percentage

of total consumption
monopoly position and long-term contracts rather than spot market and
future markets. The Russian energy strategy recognizes this to some extent
and, therefore, has different development adjustment paths. It is more
difficult for a country like Russia that is still in a transition to pinpoint
in what direction its economy will be heading. The abundance of natural
resources could very well fuel a more value-added manufacturing sector.
The Russian Ministry of Energy and the central government is very much
in charge of the direction Russia is taking. Coordination between energy
sectors will not be an issue in Russia. The downside is that state energy
policies determine to a large extent what investments will be made and
what investments and technological innovations will occur. This could
stifle innovation and the entry of new energy players.
3.4 Canada
Canada is the only country that does not currently have a formal energy
strategy even though the current Prime Minister, Stephen Harper, has
referred to Canada as an emerging “energy superpower”. Canada has vast
resources of bitumen in the oil sands, shale gas, uranium, hydropower,
coal, oil and natural gas, and a vast potential of alternative and renewable
resources in the form of wind, solar, biomass and tidal power. The country
is a net exporter of energy with 99 per cent of all energy exports going to
the United States (Foreign Affairs and International Trade Canada.
While Europe is dependent on a single supplier of natural gas for much of
its energy demands, Canada relies on a single buyer of its resources. Due

to the geographic separation of Canada’s oil supply basins and the major
areas of demand, about 50 per cent of the crude oil used by Canadian
refiners to meet consumers’ oil product needs comes from imports. About
44 per cent of those imports come from OPEC countries and 37 per cent
come from the North Sea. Because of this import and export dependency
and tremendous potential benefits from further development of the vast
renewable resource potential, it seems astounding that Canada has no
official energy strategy and vision. There are a number of reasons that
have contributed to this. The Dominion of Canada is a federal state, but
one of the most decentralized ones in the world. Provinces have author-
ity over crucial sectors such as energy, education, health and natural
resource management. This complicates coordinated decision-making
at the federal level or between the provinces. Although the federal gov-
ernment has a proscribed role to play, it has the sole responsibility for
development of national strategies (see also the latest report, Standing
Senate Committee on Energy 2012), depending to a large degree on politi-
cal will and leadership of the federal government in power. Under Pierre
Elliot Trudeau as Prime Minister in the 1980s, the federal government
implemented the National Energy Programme (NEP) that divided the
country. Some of the main objectives of the NEP were to promote oil self-
sufficiency for Canada, maintain the oil supply for the Eastern Canadian
manufacturing base, promote oil exploration in Canada, and to increase
government revenues from oil sales through taxes, other instruments and
agreements between the federal government and the provinces. The NEP
also capped the price of oil for Canadian producers. The province of
Alberta and Western Canadians were, therefore, deprived of cashing in on
escalating prices arising from the international oil crisis. Instead they had
to subsidize the manufacturing sector of the Eastern part of the country.
Canada’s western producing provinces objected strongly to the intrusion
of the NEP into their jurisdiction over resources. For these reasons, no
federal government after Trudeau’s has attempted to devise a national
energy strategy.
Subsequently, Western Canadians have seized the opportunity to accel-
erate development of the provinces rich resource base of bitumen in oil
sands and shale gas resources for domestic and export markets. In the last
10 years Alberta (and soon also Saskatchewan) has experienced an ongoing
oil boom (with small interruptions through the world economic crisis). The
problem they face today is the lack of pipeline capacity to deliver bitumen
to existing and new export markets. Due to monopsonistic power by the
United States and a glut of supply in the Western U.S., Alberta oil is
receiving heavy discounts. The Natural Resources Minister is estimating
that the price differential to global markets costs Canadian producers over

$ 20 million a day (Plecash (2012)). Alberta is, therefore, very keen on

diversifying its export markets. In addition, under the free trade agreement
with the U.S. and Mexico (NAFTA), article 605 requires that Canada con-
tinue the amount exported to the U.S. and Mexico as a ratio of Canadian
production and not to disrupt natural supply channels. The commitment
to new pipelines to the United States could, therefore, seriously impede
Canadian energy security and could tie them to lower prices in the U.S.
market. Pipeline companies such as Enbridge and TransCanada have
recently applied to the Canadian National Energy Board to have an oil
pipeline between Sarnia and Montreal reversed in order to provide a
means to flow western Canadian bitumen to Canadian customers, refiner-
ies, and potentially export markets. This will open the door for access to
world markets outside of North America. In order to expand and diversify
Canadian energy markets, Canadian provinces need to coordinate their
support for pipelines, which pass through different provinces in order to
cross the Canada-US boundary or to reach export terminals.
In addition, Canada must properly account for environmental damages,
particularly carbon emissions from bitumen extraction, transportation
and the electricity sector in order to be seen as environmentally respon-
sible and to win support for exporting energy commodities and products
to European markets. Canada and the EU are in the process of signing a
free trade deal, which would open up new markets for Alberta oil. Trans
Canada Pipeline is considering conversion of the existing natural gas pipe-
line to enable transportation of bitumen from Alberta through Québec
and New Brunswick to a future east coast export terminal.
Because all these energy developments require substantial coordination
and policies at the national level, it is no surprise that the current Alberta
premier Alison Redford is pushing for a national energy strategy. The
current federal government has, however, chosen to not get directly involved
and instead defers to the Annual Meeting of Federal, Provincial and
Territorial Mines and Energy Ministers to make progress on this matter.
The 2011 Meeting of Provincial and Territorial Premiers meeting resulted in
a declaration of commitment to a “Pan-Canadian” approach to developing
the country’s natural resources based on economic development, energy effi-
ciency and innovation (Plecash 2012). Alberta Premier Redford refers to an
action plan from 2007 that included improvements in energy efficiency and
conservation, the acceleration of clean-technology deployment, clean energy
for the future, a modernization of the energy transmission infrastructure
(including an East-West grid), streamlining the regulatory process, develop-
ing human resources in the energy sector, and permitting the provinces and
territories to participate in international energy negotiations.
The making of energy policy in Canada is a divided responsibility between

the federal and provincial governments. Provincial governments own the

energy resources within their boundaries and develop independent energy
policies for the development, management, and taxation of their resources.
At present, the federal government has not taken an interest in develop-
ing a national energy strategy. Any strategy and any future changes would
require the approval of 13 provincial and territorial premiers. At the most
recent meeting of provincial premiers, all provinces except British Columbia
agreed to proceed to develop a Canadian energy strategy. The province
of British Columbia (B.C.) is currently boycotting the development of a
national energy strategy because of the risk associated with the controversial
Northern Gateway pipeline proposal that is planned through pristine areas
of B.C. and many aboriginal lands in order to transport Alberta bitumen to
Asian markets through B.C. ports. The B.C. premier is not willing to take the
risks of pipeline leaks and shipping accidents in the pristine marine environ-
ment without being properly compensated from oil revenues.
3.5 The European Union
The European Union (EU) has a long-term (European Commission 2011)

and a short-term (European Commission 2010) energy strategy. The EU
is committed to reducing greenhouse gas emissions to 80–95% below 1990
levels as stated in its “Roadmap for moving to a competitive low-carbon
economy in 2050”. In its long-term energy strategy the EU is explor-
ing ways to achieve its decarbonization objective while at the same time
ensuring security of energy supply and competitiveness. The short-term
and long-term energy strategies of the EU are, therefore, guided by the
decarbonization policies. Consequently the EU strategy heavily relies
on the transition to renewables and significant improvements in energy
efficiency. In addition it relies on natural gas imports, and in contrast to
the United States, is cautious on the development of internal market shale
gas deposits. Instead it counts on a diversification of energy fuels and a
doubling of electricity in final energy demand. Electricity will be generated
with a mix of nuclear, renewables, coal and natural gas. The latter two are
planned to be effectively connected to CCS technologies by 2030 in order
to control carbon emissions from the energy sector.
The EU framework is technology neutral in the sense that it does not
dictate specific technologies on individual member countries but instead
attempts to provide incentives through carbon pricing, as for example
through the EU Emission Trading System (ETS). Since member states
have very different views on certain technologies such as nuclear, renewa-
bles or unconventional natural gas, there is large uncertainty about the
role of various energy sources in 2050. One EU objective does stand out

Table 9.3 Characteristics of national energy strategies in countries with

high import dependence
Country/ Energy Focus of Energy Components of Definition of

Region Strategy Strategy Energy Strategy Energy Security
(Name and
Date)
United States Blueprint Increasing (1) Expansion Affordable,

for a Secure domestic energy of Domestic Oil safe and
Energy supply, reducing and Natural Gas reliable supply
Future (The energy imports, Development and of energy
White House reduction of Production
(2011)) energy costs, (2) Increasing
energy efficiency energy supplies
and R&D for worldwide and
clean energy promotion of
technologies switch to cleaner
technologies
(3) Fuel
efficiency
standards for
vehicles
(4) Energy
efficiency in
buildings
(5) Domestic
clean energy
promotion and
support of R&D
EU Energy Decarboniz- (1) Energy Diversification

Roadmap ation, security efficiency of fuels,
2050 of energy measures sources of
(15/12/11) supply and (2) Drastic supply and
Energy 2020 competitive- increase in transit
(10/11/10) ness, develop the share of routes,
a long-term renewables protection
European (3) CCS of EU and
technology- utilization foreign
neutral as of 2030 investments
framework (4) Nuclear part in energy
of the mix but producing
uncertain what countries,
exact role it will safety and
take security of
(5) Doubling oil, natural
share of gas pipelines
electricity


consumption Energy tional energy markets
mix Coordination/ sources
Strategy
2035: Federal Energy Limited Large Reducing oil
15% RES Regulator’s flexibility, reliance on demand while
and Liquid Commission no drastic shale gas and increasing the
Biofuels (FERC) changes in oil reserves supply of oil
25% Nat. Gas primary worldwide
32% Oil energy mix, and the trade
20% Coal continued in natural
9% Nuclear reliance on gas, new
coal and oil, international
shale gas framework for
might add nuclear energy
flexibility,
reliance on
cost improve-
ments for
solar and
advance-
ments in CCS
for coal
2050: ACER, Flexible Cautious Large reliance,

50% RES, 25% ENTSO-G, resources in consideration especially
Natural Gas, ENTSO-E the power of shale gas intercon-
25% Oil, system nectedness in
Nuclear and (e.g. flexible the EU internal
solid fuels generation, market,
storage, increased
demand reliance on
manage- electricity
ment), further grids, LNG
electricity and and natural
gas market gas pipeline
integration, projects
more

Country/ Energy Focus of Energy Components of Definition of

Region Strategy Strategy Energy Strategy Energy Security
(Name and
Date)
EU in final energy a nd related
demand production
(6) Smart and transport
techno- infrastructure
logy, storage
and alternative
fuels
Japan Basic Three prime (1) Securing To secure

Energy Plan areas of focus: resources and sufficient
(2010) – energy enhancing energy supply
security supply stability at reasonable
– environmental (2) Independent prices for the
protection and achievement,
– efficient environment- pursuit and
energy supply. friendly energy maintenance
Start with supply structure of maximizing
significant (3) Realizing economic/
decrease in a low carbon social
energy demand, energy demand welfare and
by 13% by 2030 structure sustainable
(4) Building development
next- of national
generation economy
energy and and citizens
social systems (2006 BES
(5) Developing presentation)
and diffusing
innovative
energy
technologies
clearly, which is to drastically reduce the dependence on oil by half to 20

per cent by 2050 (see Figure 9.2).
Because increasing electrification of the energy system plays such a
strong role in the EU, the EU energy strategy pushes further electricity


consumption Energy tional energy markets
mix Coordination/ sources
Strategy
integrated
view on
transmission,
distribution
and storage
Energy Agency for Entirely import Nil, negligible Reliant on

consumption Natural dependent, no domestic imports for
(no exports) Resources flexibility re resource over 80%
(million and Energy develop-ment endowment of primary
kilolitres) (ANRE), a part of domestic energy.
Energy: of Ministry resources. Forging
589 in 2007 to of Economy, Major effort closer ties
514 in 2030 Trade and to decrease with energy
Petroleum: Industry demand, and, commodity
240 in 2007 to (METI) thereby, to suppliers
142 in 2030 Nuclear and decrease export
Coal: Industrial dependency.
130 in 2007 to Safety Agency Major effort
85 in 2030 (NISA), a part on energy
Gas: of ANRE efficiency and
106 in 2007 to conservation,
80 in 2030 to reduce
Nuclear: demand.
60 in 2007 to Focus on
122 in 2030 increasing
Renewables: share of
35 in 2007 to nuclear and
67 in 2030 renewables
(Ministry of
Economy,
Trade and
Industry
(2010))
market integration and more integrated views on transmission, distribution

and storage. The EU already has institutions that coordinate the electric-
ity market such as the Agency for the Cooperation of Energy Regulators
(ACER) and the European Network of Transmission Grid Operators for

Graph 1: EU Decarbonisation scenarios − 2030 and 2050 range of fuel shares

in primary energy consumption compared with 2005 (in %)
% %
75 2030 75 2050
2005
50 50
25 25
0 0
ES
as
ar
il
ES
as
ar
il
s
el
el
O
O
G
le
le
fu
fu
R
R
uc
uc
lid
lid
N
N
So
So
Source: European Commission (2011).
Figure 9.2 Energy mix outlook for the EU 2030 and 2050
Electricity (ENTSO-E). These agencies already have experience in the

coordination between countries and will make it easier to find additional
improvements in the efficiency of electricity use and the development of
smarter grids. The increased reliance on electricity for energy supply in the
internal EU market is one aspect of energy security for the EU. In addi-
tion, the EU relies on further diversification of fuels, sources of supply and
transit routes, and the protection of EU and foreign investments in energy
producing countries. Securing additional natural gas pipelines and related
production and transport infrastructure will be a key part of the energy
strategy particularly as conventional natural gas plays a crucial role in the
transition to a low carbon economy, and as a backup for the increasing
addition of intermittent renewable energy sources. Increased trade in lique-
fied natural gas could be an important additional source of natural gas for
the EU, which could have the effect of reducing the use of coal for electric-
ity generation and of significantly dropping energy costs in the EU.
3.6 The United States
The Unites States latest energy strategy entitled “Blueprint for a Secure
Energy Future” (The White House 2011) is very different from the EU
strategy. The focus of the strategy is not on decarbonizing the economy
and transitioning to a low carbon economy. Instead the U.S. Blueprint

History 2010 Projections

125
Renewables
(excluding liquid biofuels)
7%
100 11%
4%
Liquid biofuels
1%
75 25% Natural gas 25%
9%
Nuclear 9%
50 21%
Coal 20%
25
37% Oil and other liquids 32%
0
1980 1990 2000 2010 2020 2035
Source: EIA (2012).
Figure 9.3 U.S. primary energy consumption by fuel (quadrillion btu per

year)
emphasizes the reduction of energy costs and the reduction of energy

imports. The U.S. tries to achieve this by significantly increasing domes-
tic energy supplies, by increasing energy efficiency, and by investing
in R&D for cleaner technologies and biofuels. In contrast to the EU’s
approach that stresses carbon prices and incentives to reduce consump-
tion and switch to cleaner technologies and modes of transportation, the
U.S. targets the production or supply side. On the energy demand side of
the equation, the United States has already implemented ambitious fuel
efficiency standards for vehicles including heavy-duty vehicles (White
House 2012b). The U.S. energy strategy also targets energy efficiency of
buildings, the expansion of domestic unconventional oil and natural gas
development and production. The U.S. also is actively involved in trying
to increase energy supplies worldwide and promote switch to cleaner tech-
nologies, which would reduce the demand on fossil fuels. Energy security
is defined as affordable, safe and reliable energy supply for Americans.
The projected energy mix for the U.S. (EIA 2012) is not very different
from the energy mix in primary demand in 2010 (see Figure 9.3). A 5 per
cent reduction in oil is compensated by a slight increase in renewables and
a 3 per cent increase in liquid biofuels.
Nuclear energy and natural gas remain constant and coal retains 20

per cent of the mix, about twice as much as in the EU (in 2030). The
development of nuclear and coal is, however, uncertain due to concerns
arising from the Fukushima incident and the recent nuclear “Ausstieg”
(the phasing out of nuclear) in Germany, resulting in an uncertain future
for nuclear electricity generation in many other countries. The reliance
on coal in the EU and in North America depends on the development of
shale gas reserves and the establishment of international liquefied national
gas markets, and ultimately the price of natural gas (Brooks 2012). Shale
gas production in the U.S. is predicted to grow nearly threefold between
now and 2035, and would represent nearly half of all gas production in the
United States (EIA 2012). These predictions will only come true if natural
gas prices allow shale gas producers to break even. It is, however, not until
2015 that gas futures prices are consistently above break even prices for
only two out of the five major shale basins (Brooks 2012).
The U.S. energy strategy has limited adaptability. It continues to rely
to a large extent on fossil fuels, including the same proportion of coal and
a slightly reduced proportion of oil in the primary energy mix. Shale gas
may add some flexibility but it is quite uncertain to what extent it can be
relied on for energy security and affordable consumer and industry prices
since it only becomes lucrative at significantly higher natural gas prices.
The Energy Blueprint also assumes substantial reductions in the cost of
solar power (one quarter of 2009 costs by 2030) and in the cost of electric
vehicle batteries. It is also quite optimistic on the deployment of carbon
storage and capture (CCS) technologies within 10 years of the blueprint
(by 2021). On the institutional side, similar to the EU, the U.S. has the
federal energy regulators commission (FERC) that coordinates between
states. For example, it regulates the transmission and wholesale sales of
electricity in interstate commerce, it regulates the transmission and sale of
natural gas for resale in interstate commerce, regulates the transportation
of oil by pipeline in interstate commerce, approves the siting and aban-
donment of interstate natural gas pipelines and storage facilities, ensures
the safe operation and reliability of proposed and operating LNG termi-
nals, and licenses and inspects private, municipal, and state hydroelectric
projects. FERC has its own strategic plan with the two primary goals to
ensure that rates, terms and conditions are just, reasonable and not unduly
discriminatory or preferential, and to promote the development of safe,
reliable and efficient energy infrastructure that serves the public interest.
3.7 Japan
Among the countries covered in this study, Japan is unique due to its
almost complete reliance on energy commodities from foreign sources.

Japanese governments have squarely addressed this vulnerable situation

through legislation established in 2002. The Basic Act on Energy Policy
(BEAP) focused on three central energy issues of importance to Japan:
securing stable supply of energy; ensuring environmental sustainability;
and, utilizing market mechanisms to control energy pricing and flows.
Security of supply has been the central focus of a succession of three
energy plans, all based on the BEAP in 2002, in 2003, in the New National
Energy Strategy in 2006, and most recently in 2010, in the Strategic Energy
Plan of Japan: Meeting global challenges and securing energy futures
(SEPJ) (Ministry of Economy, Trade and Industry, Government of Japan
2010).7 The SEPJ was issued nine months prior to the nuclear incident
at the Fukushima Daiichi nuclear power plant in March 2011. The sig-
nificant reliance on an increasing share of electricity from nuclear power
plants as a means to achieve a significant share of the SEPJ’s objectives is
now a matter of public debate and opposition. As described below, while
the general directions and principles remain sound and commendable, the
means to achieve Japan’s laudable goals is in serious question.
3.7.1 The strategic energy plan of Japan

Three “basis points of view” set the context for the 2010 SEPJ. In
keeping with previous Japanese energy plans, the three primary thrusts
of energy policy are energy security, environmental protection, and effi-
cient energy supply. Two additional policy directions were introduced in
2010: energy-based economic growth and reform of the energy industrial
structure; and, a fundamental overhaul of the energy supply and demand
system by 2030. The plan sets five ambitious targets between 2010 and
2030. Three of the targets are directly related to energy security: doubling
the energy self-sufficiency ratio (renewables and nuclear), from the present
18 per cent and doubling the self-developed fossil fuel supply ratio (coal,
natural gas, oil and LPG produced by Japanese companies); raising the
share of zero-emission power share from 34 per cent to 70 per cent; and
maintaining and enhancing energy efficiency in the industrial sector at the
highest level in the world.8 Highlights of each of the measures, which are
expected to achieve these targets, illustrate the significant level of effort,
which will be required. With respect to energy supply, the BEPJ calls for
assisting the expansion of renewable energy sources through expanded
feed-in tariffs, support for R&D, and power grid stabilization in order
to effectively handle an increase in variable generation. Nine new nuclear
plants are to be built by 2020 with overall utilization rates of 85 per cent,
and 14 more plants by 2030 with utilization rates of 90 per cent by 2030.
It is also planned to reduce CO2 emissions from coal-fired plants to levels
comparable with IGCC plants, and to accelerate the implementation of

carbon capture and storage technology by 2030. Reducing energy demand

is an effective pathway towards improved energy security and reduction of
GHG emissions. The BEPJ calls for a suite of energy efficiency initiatives
in each of the end-use sectors of the Japanese economy. Incorporating
improved grid-based technologies, such as smart grid, smart meters, and
equipment to control electricity demand in real-time are identified as a
means to improve the reliability, efficiency, and stability of the electricity
system (Ministry of Economy, Trade and Industry, Government of Japan
2010). The impacts of the suite of measures on total primary energy supply
and on the shares of each energy commodity are significant. First, primary
energy supply is projected to decrease dramatically by 13 per cent by 2030.
Japan is unique in setting this aggressive target to reduce overall energy
demand. Second, the shares estimated to come from nuclear power and
renewable energy technologies are expected to more than double over the
20-year projection period.
One significant factor in Japan’s long-term energy future is the role that
nuclear power will play, post-Fukushima. The BEPJ indicates that if these
estimates are realized, that the share of Japan’s electricity from nuclear
power will be approximately 50 per cent of generated electricity in 2030.
LNG is projected to contribute approximately 10 per cent. In light of the
impact of the Fukushima incident, the subsequent shutdown of the bulk of
nuclear generation, and the expressions of public anxiety around nuclear
energy in general, the energy security picture for Japan is highly uncertain.
One option available to Japan is to increase the generation capacity from
plants using natural gas turbines, from IGCC plants, and from cogen-
eration facilities. Rather than a projected reduction of the contribution
from natural gas (see Table 9.4), the role of natural gas supplied via
international LNG markets creates one viable, and prompt, pathway for
maintaining electricity generation. The negative impact on the hoped-for
Table 9.4 Dramatic supply shifts in Japan by 2030
Energy Source Actual Fiscal 2007 Estimated 2030

Petroleum 41% 28%
LPG 3% 3%
Coal 22% 17%
Natural Gas 18% 16%
Nuclear Power 10% 24%
Renewable Energy 6% 13%
Total Primary Energy 589 (m kilolitres) 514 (in kilolitres)
Source: (Ministry of Economy, Trade and Industry, Government of Japan 2010).

reduction in GHG emissions will be one unfortunate consequence from

the expansion in natural gas generation capacity.
4 WHAT EXPLAINS DIFFERENCES IN

NATIONAL ENERGY STRATEGIES? FEATURES,
RECOMMENDATIONS AND “BEST PRACTICES”
The observations from our selection of countries, ranging from those
largely dependent on imported energy commodities to those that rely on
sales of their resources to export markets, demonstrate the multi-faceted
and complex nature of energy strategies. Each of the countries studied,
with the exception of Canada, has an official national, or – in the case of
the EU – economy-wide, energy strategy that provides energy directions
at least until 2030. The focus of most strategies is on the availability and
affordability of domestic energy supplies, clean energy, technological inno-
vation, conservation and sustainability. Only Japan and the EU explicitly
mention energy security as one of the main focuses, while the U.S. indi-
rectly refers to energy security as a main focus of their energy strategy.
Energy security is not a component of the energy strategies of Australia
and Norway. Canada also has no explicit energy strategy and hence no
energy security policy. Although Norway, Australia and Canada are rich
in energy resources, it is surprising that they do not address export market
or demand security as a threat to their overall economic future. Only in a
recent speech by Norway’s Energy Minister to industry delegates in the
United States was energy security defined for Norway. Norway is con-
cerned (as Canada, Australia and Russia should be) about markets that
are not open, transparent and that do not have clear, competitive price
signals. Without open market operation, exporters of energy markets will
have difficulty accessing their existing and new export markets. Energy
resources will continue to be dictated by geopolitical processes.
The definitions of energy security of all of the G8 countries have many
similarities. All refer to securing reliable, affordable and sufficient energy
resources. Only Canada and Norway stress global energy security since
both countries depend on maintaining access to stable world energy
markets. Canada’s approach is to reduce its dependence on one client
(the U.S.) and Norway wants to maintain and expand its export markets
in Europe. It supplies Europe with petroleum and natural gas and has
bidirectional electricity trade with neighboring countries via the NordPool
electricity market. Russia, on the other hand, has access to European
natural gas markets through pipeline connections, which are, however,
being challenged by alternative pipeline projects and liquefied natural gas

terminals in the near future. This means Russia will need to rely more on
access to open, transparent and competitive markets.
As stated by Chester (2010): “The meaning of energy security differs
over the short, medium and long term because the probability, likelihood
and consequences of different risks or threats to supply will vary over
time. Thus we will never reach an end-state of energy security as such.”
Changes can occur quickly in energy markets, due to geopolitical events,
the advent of new more efficient energy technologies, or the development
of new ways to access previously untapped components of a country’s
national resource base. Such developments will typically have a direct
influence on energy security considerations. Examples are the potentially
negative impact of the Fukushima incident on Japan’s expectations for
an increasing share of nuclear power and the United States’ recent oppor-
tunity to possibly become a LNG exporter as a consequence of growth
in gas supply from shale gas reservoirs. This calls for regular reviews of
energy security strategies, and also a readiness to revisit strategies in situa-
tions in which fundamental supply-demand factors have changed. Japan’s
practice of issuing updated comprehensive basic energy plans every four
years is a good “best practice”, in fulfillment of legislative provisions. The
Fukushima incident will precipitate a thorough review of Japan’s goals
and strategies. Japan needs to review regularly because it does not have
a lot of built-in flexibility in its energy system. The EU intends to have
more flexible resources in the power system that could advance electricity
integration and the electrification of European energy and transporta-
tion systems. The United States is relying heavily on unconventional
and some alternative resources. It is not drastically changing its primary
energy consumption mix and increasingly relies on domestic sources. This
limits flexibility and adaptability of its energy system and makes the U.S.
vulnerable. The U.S. energy strategy illustrates, however, how technology
advancements directly interplay with energy strategies through potentially
facilitating access to previously-untapped components of the resource
base, bringing down the cost of new energy technologies, and opening up
completely novel ways of providing energy services. Examples are the use
of new production techniques to access the natural gas in shale reservoirs
in the United States and Canada, the dramatic fall in the cost of solar cells,
and emerging technologies, which will facilitate electrification of trans-
portation. In fact, technological advances can have a profound effect on
national energy security, illustrated by the emerging possibility of natural
gas LNG exports from the United States to European markets and the
development of highly-efficient natural gas turbines for electricity gen-
eration, as well as potential solutions for cleaner coal production through
carbon capture and storage technologies. Nuclear is the elephant in the

room and creates large uncertainty as countries are either undecided about
its future (e.g. in Japan or in Canada) or cannot agree among themselves
(e.g. in the EU).
In addition, policy developments in related areas have played a crucial
role in the energy path that nations choose, the institutions that develop
to govern energy developments, and the strategies that are chosen. The
EU for example had agreed on a climate change strategy that had a direct
influence on the characteristics of its energy strategy. In fact, one could
argue the EU devised an energy strategy in order to fulfill its climate
change aspirations. The opposite holds for the United States where energy
strategy and energy security always trumps climate change policy. The
U.S. always had a very explicit and clear energy strategy but to date has
not been able to pass a climate change bill through Senate. In Canada
experience with the NEP has stalled national discussions about a national
energy strategy and has strengthened the authority of provinces over
energy and environmental policy, and now that provinces are ready for
an energy strategy, there is a lack of federal authority to pull it through.
Historic events such as Harrisburg/Three Mile Island (1979), Chernobyl
(1986) or most recently Fukushima (2011) critically influence public
opinion and energy strategies. Due to these events Germany took a quick
stand on a long debated question to phase out nuclear, and Japan is strug-
gling to develop a revised energy plan. Even the U.S. and understandably
Russia have become more cautious with nuclear technologies. None of the
G8 countries (with the exception of Germany) makes a clear or firm com-
mitment to nuclear energy, but also do not step away from it, and leave at
least a small proportion in their energy mix.
5 CONCLUSION
Energy security issues for major industrialized nations are changing. It is

no longer merely a question of securing adequate supplies of energy to fuel
an ever-growing manufacturing base. The major industrialized nations are
focusing more on becoming major energy exporters of conventional oil
(Norway and Russia), coal (Australia), conventional natural gas (Norway
and Russia), unconventional oil (Canada) and unconventional natural
gas (potentially the United States). In the meantime the EU intends to
set up a more integrated and sophisticated electricity system with a large
proportion of renewables and might act as a major importer and exporter
of electricity. Only Japan is left on its own, being dependent on imports for
securing energy for its manufacturing and consumption base. These new
developments are demanding new energy strategies that create a vision

about supply and demand security, integration of markets and electricity

systems and open access to global energy markets. In addition, decisions
in these G8 countries and Norway on climate change commitments and
nuclear technology investments will determine to a large extent the new
world energy order. The potential for a nuclear renaissance will be deter-
mined by some of the G8 countries that then will export their technologies
to the major emerging energy markets in China, India, Brazil and develop-
ing nations. Climate change negotiations have to advance sooner rather
than later and will critically influence the path of energy developments. All
this will require more regular adjustments to national energy strategies.
NOTES
1. Draft Energy White Paper, p. 65

2. ‘High energy security’ is defined as meeting Australia’s economic and social needs.
‘Moderate energy security’ means that needs are being met but with emerging issues that
will need to be addressed to maintain this level of security. ‘Low energy security’ means
that needs are not being, or might not be, met.
3. In the Draft White Paper, the term “adequacy” is defined as the provision of sufficient
energy to support economic and social activity, and “reliability” is the provision of
energy with minimum disruptions to supply.
4. NESA, p. 78
5. Electricity production from hydro facilities makes up the remaining 7 per cent.
6. The term “national value creation” is synonymous with gross domestic product.
7. A thorough review of Japan’s new basic energy plan has been provided by Duffield and
Woodall (2011).
8. The two remaining targets are to reduce the emissions from the residential sector to one
half of current levels, and to maintain or obtain top-class shares of global markets for
energy-related products and systems.
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10. Developing world: national energy
strategies
Sylvia Gaylord and Kathleen J. Hancock*
1 INTRODUCTION
In July 2012, India experienced the worst blackout in its history, plunging
670 million people – about 10 percent of the world’s population – into
darkness and bringing energy security into headlines around the world.
India’s inability to guarantee energy supply is seen as a major factor
hindering its development. Companies depend on reliable energy and are
thus hesitant to invest in countries where security of supply is question-
able (Sharma et al. 2012; Harris and Bajaj 2012). News coverage of the
blackout linked energy access to long-term development. If India’s system
is vulnerable to such a massive shut-down, how can domestic and inter-
national companies be expected to invest and thrive in India, and without
this investment, how will India raise the standard of living for its citizens?
While developed states also have electricity blackouts, India’s energy
disaster highlighted the severity of energy security problems in the devel-
oping world and invited debate on the best strategies for enhancing energy
access. In this chapter, we focus on energy issues and related strategies
of particular relevance to the developing world. These tend to empha-
size increasing electricity access for the larger population and long-term
economic development for the state. These primary concerns, along with
limited financial and military resources for energy security, shape the
strategies developing countries can and do employ.
The term “developing countries” encompasses most of the world,
including a broad range of income levels, from the least-developed states
to large emerging economies, and population sizes, all the way from tiny
island states to the two most populated states in the world. Since examin-
ing strategies in all of the states covered by the term is not possible, we
look at general trends in the three main world regions where lower per-
capita-income states are the majority: Southeast and East Asia (including
China and India), sub-Saharan Africa, and Latin America.
We begin by briefly discussing the concept of energy security (see
earlier chapters for more detail) and then elaborate on energy security
goals for developing states. We then discuss in detail six energy strategies:
206

Developing world: national energy strategies 207
(1) nationalize energy companies, (2) privatize energy companies to attract

foreign direct investment (FDI), (3) increase and diversify domestic sup-
plies through nuclear or renewable energy sources, (4) diversify imports,
(5) build and maintain strategic petroleum reserves, and (6) increase effi-
ciency. Under each strategy, we discuss the issues involved and summarize
some associated activities in developing states. We conclude the chapter
with a number of observations about issues surrounding these strategies in
the developing world and suggestions for future research.
2 ENERGY SECURITY ISSUES
While there is significant debate about how to define energy security,

most current discussions include four key concepts: availability, reliabil-
ity, affordability, and sustainability (APEC 2007; UNDP 2004; Xu 2012;
Chester 2010). For example, the United Nations Development Program
defines energy security as “the availability of energy at all times in various
forms, in sufficient quantities and at affordable prices without unaccepta-
ble or irreversible impact on the environment” (UNDP 2004, 42). The two
primary energy goals for the developing world – electricity for the general
population, and long-term economic development for the state – relate to
all four elements of this definition.1
One in five people in the world (1.3 billion) lacks access to electricity in
their homes and businesses (IEA 2011b, 1) and lives in conditions broadly
labeled as “energy poverty” (IEA 2012). Nearly 40 percent rely on wood,
coal, charcoal, or animal waste to cook their food – all sources of toxic
smoke – causing lung disease that kills nearly 2 million people a year, most
of them women and children. The Advisory Group on Energy and Climate
Change (AGECC) states that “current energy systems are inadequate to
meet the needs of the world’s poor and are jeopardizing achievement” of
the United Nation’s Millennium Development Goals (AGECC 2010).
Modern energy infrastructure allows people in remote areas to participate
in economic activity, facilitates the delivery of health, education and other
services, and the provision of clean water and safer food.
The AGECC breaks energy needs into three levels: (1) basic human
needs (lighting, health, education, communication, community services
and modern fuels for cooking and heating), (2) productive uses (electricity
and other energy services to improve productivity–for example, in agricul-
ture, water pumping for irrigation, fertilizer, and mechanized tilling), and
(3) modern society needs (domestic appliances, private transportation,
etc.) (AGECC 2010). The IEA estimates that meeting basic human needs
(level 1) alone will require $35 billion/year for electricity access plus $2–3

billion/year for modern fuels access (AGECC 2010). Developing states are
primarily focused on the first two levels.
While developing countries are broadly labeled as “energy poor”, access
varies significantly between and within regions and between rural and
urban areas within states. In 2009, 91 percent of the population in East
Asia and the Pacific region had access to electricity (World Bank 2012).
Despite this high regional rate, access in some states, such as Myanmar, is
as low as 13 percent. In the region, annual commercial energy production
grew over 6 percent in the decades from 1980–2002, well above the global
average (ESCAP 2006, 78). Average electrification for Africa as a whole
is 67 percent in urban areas and 23 percent in rural areas (Yépez-García
et al. 2010, 32; Niez 2010; World Bank 2008). Sub-Saharan Africa has
the lowest electricity access rate, estimated between 24 and 32 percent;
rural electricity access is only 8 percent. Despite growth of 70 percent in
electricity generation in the period 1998–2008, 85 percent of the popula-
tion relies on traditional biomass (mostly wood) (UNEP 2012, 9; World
Bank 2012; Eberhard et al. 2011). In Latin America, 93 percent of the
population had access to electricity in 2009 (World Bank 2012). Average
rural electrification stood at 70 percent, with the lowest being Haiti at 12
percent (Yépez-García et al. 2010, 32). While coverage is poorer in rural
areas, rapid growth in urban centers has put considerable pressure on
infrastructure in urban areas as well (Fay and Morrison 2005, 2; Calderón
and Servén 2010).
The second primary goal for developing countries is long-term sustain-
able development, similar to the AGEEC’s level 2 focus on energy for
productive purposes. The effect of India’s inadequate electricity supply on
long-term growth, illustrated by the 2012 blackout, is substantial, equating
to an estimated loss of two percentage points in GDP growth (India Reels
From Second Power Grid Collapse 2012). As with India, most developing
countries need to overhaul energy and transportation infrastructure to
provide immediate basic needs but also to attract the investment necessary
to meet long-term development goals.
The U.S. Energy Information Agency (EIA) estimates energy demand
in developing countries will drive future world energy consumption. In
2035, developing country demand is expected to be 85 percent higher than
in 2008, with consumption projected to rise the most in Asia (117 percent)
and the least in Africa (67 percent). The industrial sector is expected to
lead the growth in demand, at an annual rate of 2 percent, followed by the
transportation, services, and residential sectors. This projection assumes
annual average growth in world GDP of 3.4 percent, with developing
economies averaging 4.6 percent, and China and India averaging 5.7
percent and 5.5 percent, respectively (EIA 2011, 10–11). The projections

also show the gap in energy consumption between developed and develop-
ing countries increasing dramatically, with developing countries collec-
tively consuming 67 percent more than developed ones in 2035, up from a
gap of 7 percent in 2008. The growth in the energy demand of the indus-
trial sector will also be higher in developing countries because they tend
to focus on less-efficient and more energy-intensive products (EIA 2011,
15). Exxon Mobil estimates that developing countries’ combined energy
demand will increase by 60 percent between 2010 and 2040, keeping pace
with population growth (ExxonMobil 2012; BP-British Petroleum 2011).
These projections do not take into account potential improvements in
technology, improved energy efficiency or climate control policies.
To achieve energy security, both in terms of providing for people’s basic
needs and creating the conditions for long-term sustainable economic
growth, developing countries need energy resources and infrastructure.
The following section provides an overview of energy strategies for
developing countries to attain these goals.
3 ENERGY SECURITY STRATEGIES
Developing countries employ a variety of energy security strategies. For

each strategy, we include definitions of concepts, an evaluation of the
debates surrounding the strategy, and examples of projects related to
these strategies in the three regions on which we focus: East Asia and the
Pacific, sub-Saharan Africa, and Latin America. There are numerous
initiatives, not all of which can be covered here. As such, the summaries
of projects are illustrative only. Many articles that define energy security
and elaborate on strategies do not distinguish between levels of develop-
ment (Winzer 2012; Sovacool and Mukherjee 2011). Of the few that do,
most focus on the industrialized states (Löschel et al. 2010) while others
evaluate strategies for specific countries, many of which we cite in the fol-
lowing sections. We focus here on strategies that a number of states are
pursuing and seem most likely to address energy poverty and longer-term
development concerns.
States concerned with the security of energy supply generally choose one
or more of the following strategies: nationalize energy companies, priva-
tize energy companies to attract foreign direct investment (FDI), increase
and diversify domestic supply by developing nuclear and renewable energy
sources, build and maintain strategic petroleum reserves, protect energy
infrastructure, and increase energy efficiency. Some of these strategies
are available to all developing states, such as increasing efficiency, while
others demand significant financial resources, technological development

(for nuclear energy, for example) and assets (such as military equipment
for protecting sea lanes) that are out of reach for all but the largest emerg-
ing states of China, India, and Brazil.
3.1 Nationalize Energy Companies
Energy nationalism has recently re-emerged as a strategy for Latin

American developing countries seeking to protect domestic energy
resources and secure the supply of energy from other countries (Vivoda
2009). In addition, Asian countries have been using national oil compa-
nies (NOCs) since the late 1970s to guide their economic development
and secure greater control over energy supply, pricing, and distribution.
While energy nationalism is not new – Mexico nationalized its oil industry
in 1938 (Macalister 2007) and Thailand’s NOC was formed in 1978 – it
has recently become a major source of debate. The present wave of energy
nationalism is driven by a confluence of factors. High oil prices, the emer-
gence of new large consumers, such as India and China – which is giving
energy producing nations increased bargaining power and fomenting fear
of future resource scarcity (Hughes 2011; Vivoda 2009) – disenchantment
with privatization (Steinberg 2012), and the perception that international
firms are taking resources that may one day be needed for domestic use
without paying adequate compensation (Stevens 2008).
The term energy nationalism encompasses a variety of actions, carried
out via presidential or legislative mandates. States can take ownership
by purchasing assets from private owners or by seizing assets without
compensation (Monagas 2012). States can also renegotiate contractual
terms, imposing tougher conditions on private companies (Rigobón 2008;
Hoyos 2006). For many developing countries, NOCs play an important
role in enhancing energy security by acquiring overseas investments. These
aggressive investment strategies from ascending countries, such as China,
India and Brazil, are seen as evidence of growing energy nationalism
(Herberg 2010).
National oil companies are receiving considerable attention on two
counts: their growing presence in world markets in terms of control over
reserves and production, and their active participation in international
markets in direct competition with the major private oil firms (Chen
and Jaffe 2007). NOCs control an estimated 90 percent of the world’s oil
reserves and 75 percent of production of oil and gas (Tordo et al. 2011a, ix;
Economist 2006). In 2010, NOCs were responsible for 19 percent of global
investments in mergers and acquisitions in oil and gas and for the first time
outspent the major private oil firms, including investments in the U.S. and
Canada (P&GJ 2011). While the growing presence of NOCs in the energy

sector is often interpreted as evidence of growing nationalism (Dirmoser

2007), some point out that in developing countries states tend to intervene
across broad segments of the economy and energy strategies anchored in
NOCs should be understood in the context of broader development pro-
grams (Hughes 2011). Others note that not all NOCS are the same in terms
of management and investment capacity (Marcel 2009), or in terms of the
degree of government influence over investment decisions, and that despite
the depiction of NOCs in the press as a threat to world energy supplies,
they are, on average, at a disadvantage relative to private firms in terms
of technological and managerial expertise (Herberg 2007; Agashe 2010).
Asia and Latin America have been at the center of the surge in energy
nationalism, each region exhibiting its own brand of nationalism. In Asia,
energy nationalism is considered a dominant regional trait (Vivoda 2010).
According to the National Bureau of Asian Research, Asia’s energy
nationalism is driven by the region’s limited energy resources and depend-
ence on imports to sustain trends in economic growth and safeguard the
region’s political stability (Herberg 2011). A number of Asian states, both
net importers and exporters of oil and gas, have formed NOCs over the
last few decades. China’s two most significant NOCs – China National
Petroleum Corporation (CNPC) and China Petroleum and Chemical
Corporation (Sinopec) – are among the world’s largest oil companies.
In 2009, China began dramatically increasing its overseas acquisitions
through its third most important NOC, the National Offshore Oil
Corporation (CNOOC), spending $47.59 billion in 2009 and 2010. The
seven countries where China is most invested are Kazakhstan (23 percent
of China’s overseas equity), Sudan (15 percent), Venezuela (15 percent),
Angola (14 percent), Syria (6 percent), Russia (4 percent), and Tunisia (3
percent). While China’s NOCs are government-owned, they operate some-
what independently (Jiang and Sinton 2011).
India’s Oil and Natural Gas Corporation Ltd. is a dominant player in
the domestic market (though in recent years it has lost ground to private
firms) and participates in overseas investments in 19 countries (Booz Allen
Hamilton Inc. 2007; Herberg 2007; Madan 2007). Petronas, the national
oil company of Malaysia, is the second largest multinational company
based in a developing country. Petronas has exclusive rights to the devel-
opment of the country’s oil reserves, as well as considerable interests in
South Africa’s refining and retail fuel markets, among other countries
(Lewis 2010). The Petroleum Authority of Thailand (PTT), established in
1978, integrates the various segments of the energy value chain, playing a
central role in Thailand’s national energy strategy (Kennedy 2010; Tordo
et al. 2011b).
While the NOC strategies used in Asia are similar to those pursued by

Brazil’s Petrobrás (Wertheim 2012; Sennes and Narciso; Fletcher 2009),

recent energy nationalism in Latin America has mostly involved the
nationalization of foreign owned assets and operations, and renegotia-
tion of contracts with private firms (Rigobón 2008). Bolivia, Argentina,
and Venezuela have recently attracted international attention with energy
nationalizations. In 2006, the Bolivian government passed a decree
increasing taxes, mandating a renegotiation of contracts, and returning
formal ownership of underground resources to the national oil company
YPFB, after having privatized them in the 1990s. The nationalization did
not involve seizing assets and private firms maintained control of their
operations (EIA 2012). The decision to nationalize was driven by the view
that foreign firms (including Petrobrás of Brazil) were reaping excessive
profits (Gjelten 2012) and effectively defining policy for the sector (Bolivia
Asserts 2007; Loftis et al. 2007; Cayoja 2012; Zissis 2006). In 2012, Bolivia
also nationalized the main hydroelectric plant and the power grid opera-
tor, which controls 74 percent of the electricity lines in the country (Azcui
2012). In 2012, Argentina renationalized a controlling share of its oil
company, YPF, after having privatized it in the 1990s. Venezuela, since
nationalizing its oil company PDVSA in 1976, has moved between periods
of intense state control and greater reliance on private operators. In the
last decade, the government has increased taxes and royalties, and under
threat of nationalization, forced private firms to renegotiate their con-
tracts with PDVSA (García 2011; Fletcher 2009).
Energy nationalism is among the strategies pursued by developing
countries to meet growing demand and respond to developments in inter-
national markets. In Latin America, energy nationalism has emerged
as a response to an earlier wave of privatizations and discontent with
the performance of private energy firms. In Asia, energy nationalism is
more outward-oriented and more overtly competitive. In both regions,
the renewed interest in state-driven development has encouraged energy
nationalism. The perception that energy nationalism is spreading to vast
segments of the developing world and is a strategy with the potential to
upset the world’s energy scenarios stems from the changing balance of
power in energy markets, as growing energy demand from the Asia-Pacific
region has decreased the leverage of historically large consumers, such as
the U.S. and Japan (Stanley Foundation 2006; Hughes 2011), and new
competition is emerging in the form of NOCs (Agashe 2010; Brune 2010).
3.2 Privatize to Attract FDI
Attracting private investment is a key strategy of several developing

countries facing rapidly growing energy needs. The IEA calculates that

$9 billion of the capital invested in energy in 2009 provided access to

“modern energy” to previously unserved populations, and that $48 billion
in investment per year would be necessary to provide universal access
by 2030 (IEA 2011a, 7). In the last two decades (1990–2011), investment
in energy accounted for 30 percent of the private participation in infra-
structure (which also includes telecom, transport, and water and sewage)
in low- and middle-income countries. South Asia led with 44 percent of
infrastructure investment going to energy projects, followed by East Asia
and the Pacific (39 percent), Latin America (35 percent), MENA (22
percent) and Sub-Saharan Africa (10 percent) (authors’ calculations from
the Private Participation in Infrastructure Database (World Bank Group
(n.d.)).
Private investment in developing countries began to grow in the 1990s,
peaking in 1997 and again in 2007 (Farquharson et al. 2011, 1; PWC
2012a). The global financial crisis has brought a decline in private source
of financing, though not all regions have been affected equally; Africa is
expected to bear the greatest impact of the crisis (PWC 2012b). Predictions
of future energy investment flows recognize that while the majority of
cross-border energy investment still take place within developed countries
(North America and Europe received 85 percent of all cross-border energy
investments in 2011 (PWC 2012a)), the focus for the future is on expand-
ing further into China and other developing countries (McKinsey & Co
2012; PWC 2012b).
Private investment in energy infrastructure takes two forms: privati-
zation and greenfield investments. Privatization entails transfer of total
or partial ownership and control of state assets and firms to the private
sector (OECD 2002). Privatization can also entail a concession to operate
a public asset, like a transmission line or a port. Between 1988 and 1999,
there were 221 energy privatizations (including gas, petroleum, and elec-
tricity) in 39 developing and middle-income countries for a total of $47
billion. From 2000 to 2008, there were 84 energy privatizations in 26 devel-
oping and middle-income countries for a total of $69 billion in investments
(World Bank n.d.).
In the 1980s, Latin American countries, starting with Chile and then
Argentina and Brazil, began to privatize electricity, a process that entailed
restructuring the sector into separate generation, transmission, and dis-
tribution companies. This model was later adopted by Peru, Bolivia,
Colombia, Guatemala, and others (Hall 2005). Ten countries in the region
privatized a total of 116 electric distribution utilities, now serving over 60
percent of electricity subscribers in Latin America, up from only 3 percent
in the early 1990s (Foster et al. 2006, 2).
Throughout the developing world, states are continuing to privatize

electricity, though at a slower pace, particularly following the 2008

financial crisis. The Philippines, Jordan, Russia, Poland, Turkey and
Romania recently sold state-owned electricity companies to private firms.
In 2009, India launched the sale of the National Hydroelectric Power
Corporation (Kikeri and Perault 2010). Turkey privatized 53 state-owned
enterprises in the utilities and oil and gas sectors in 2010, and 29 in 2011
(PWC 2011; Shehadi 2002).
Petroleum privatization went the furthest in Argentina and Bolivia
(though it has been partly reversed in both countries; see the section on
Nationalism). Brazil opted for a state-controlled deregulation scheme,
with Petrobrás maintaining a dominant presence in the sector but under
the regulation of an independent agency. Mexico and Venezuela remained
in complete state ownership (Palacios 2002). Colombia ended its state
monopoly over petroleum in the 2000s and became one of the countries
most open to foreign investment in oil (Economist 2012), and along with
Brazil, is one of the largest recipients of investment in the hydrocarbons in
the region (ECLA 2011).
Greenfield investment entails constructing new infrastructure where
none previously existed. In the period 1990–2011, 64 percent of private
infrastructure investment in developing countries was in greenfield
projects, with the rest going to divestitures, concessions, and management
and lease contracts. In this period, there were over 1,200 greenfield energy
projects in low- and middle-income countries for a total value of $173
billion, with the East Asia and Pacific region accounting for 45 percent of
the projects and 59 percent of the investment (authors’ calculations from
the Private Participation in Infrastructure Database (World Bank Group
(n.d.)).
Private investment in energy reversed many decades of state-sponsored
infrastructure development and required legal, and in some cases, consti-
tutional reforms that ended state monopolies, permitted divestiture and
unbundling of assets, and removed restrictions on private and foreign par-
ticipation. Privatization was part of a broader agenda of market-oriented
reforms strongly motivated by developing country debt rescheduling
and conditionality schemes in the 1980s and 1990s (Vazquez 1996; Sachs
1989; Cramer 1999; Edwards 1995). During the 1980s, public investment
in infrastructure lagged as countries struggled to cut spending to service
their debts, which also encouraged developing country governments to
surrender ownership and control of large segments of their energy sectors
to private and foreign investors (Davis et al. 2000; Edwards 1995). As of
2004, approximately 51 percent of developing countries had an independ-
ent regulatory agency for electricity and 47 percent had private participa-
tion in electricity generation (Estache and Goicoechea 2005, 4).

Despite successes in improving investment, profitability, and perform-

ance of formerly state-owned and operated companies (Megginson and
Netter 2001; La Porta and Lopez-De-Silanes 1999; Frydman et al. 1999;
Ehrlich et al. 1994), privatization remains controversial and increasingly
unpopular (Nellis 2006). Developing countries that carried out energy
privatizations have had difficulty in reconciling investor’s profit expecta-
tions and public expectations of better, more accessible service at low cost
(Trebing and Voll 2006). Many scholars identify the inadequate sequenc-
ing of reforms, which weakens competition under private ownership
(Zhang et al. 2005), and the lack of adequate regulatory capacity as criti-
cal factors undermining the success of privatization (Boubakri et al. 2008;
Durakoglu 2011; Parker and Kirkpatrick 2005). The weakness of local
capital markets and legal environments are also important in explaining
the mixed record in energy privatization (World Bank 2004; Bayliss and
McKinley 2007).
Privatization is unpopular in many developing countries because of the
perception that it is unfair, having not met the expectations of the public
while providing opportunities for local elites and foreigners to capture
public wealth (Birdsall and Nellis 2002; Chong and López-de-Silanes
2003; Ripley 2010; Roxas and Santiago 2010; Silvestre et al. 2010). In
some cases, privatization worsened the distribution of income, though
this pattern is less clear in the areas of electricity where access for the poor
has increased (Kundu and Mishra 2011; Birdsall and Nellis 2002). These
problems have been most noticeable in Africa where host countries have
had difficulty attracting foreign investors and the focus on cost recovery
has not contributed to the final goals of reducing poverty and encouraging
development. As a result, privatization in Africa was significant in only
a few countries, with sub-Saharan Africa receiving less than 4 percent of
world private investment in infrastructure between 1990 and 2003 (Hall
2007; Bayliss and McKinley 2007).
A large number of developing countries sought private investment in
energy infrastructure as a response to a sharp decline in public invest-
ment. This strategy was strongly encouraged by development agencies as
part of a broader agenda of economic reform, and was expected to inject
new capital, better technology and more efficient management into the
energy sector and have a positive spillover effect on development (Hall et
al. 2005). Developing countries continue to rely significantly on private
investment as a strategy to meet future energy demand, though develop-
ment agencies are advising a return to building up public investment in
infrastructure as private flows have proven insufficient and conditions
in many countries are not favorable to this type of investment (Fay and
Morrison 2005; Bayliss and McKinley 2007).

3.3 Increase Domestic Supply
An obvious choice for any state to enhance its energy security is to increase
the amount of fuel and infrastructure it produces domestically. Nearly all
developing states are doing this to some extent, with the exact strategy
depending on their natural resource endowments and the state’s total
GDP and level of technological development. Nationalization and priva-
tization strategies are often designed to accomplish this goal, as discussed
in earlier sections. However, for many developing states, increasing the
production of fossil fuels is off the table since they do not have significant
known reserves. Developing countries are also under pressure from devel-
oped countries and international organizations to limit fossil fuels which
contribute to climate change. The two major options discussed in this
section are nuclear energy for electricity and renewable energy for all three
end uses: heating, fuel, and electricity.
3.3.1 Nuclear energy

Nuclear-generated energy, experiencing a revival after decades of stagna-
tion, is available to a few developing states (Ferguson 2011). In the past,
developing countries used nuclear power to gain a seat at the table of
industrialized countries. Currently, nuclear energy plans are viewed as
part of a strategy of energy security (Goldemberg 2009) that can provide
energy independence and contribute to the economic stability of devel-
oping countries. International institutions in particular consider nuclear
energy as a valid option for developing countries to address the rapid
rise in demand for electricity and the need to diversify away from fossil
fuels (Embrace nuclear 2006; Bratt 2010). Despite these incentives, many
developing countries balk at the investment requirements and are often
less pressured to adopt nuclear technology to avoid the polluting effects of
fossil fuels (Goldemberg 2007).
As of 2011, 28 percent of the world’s 439 nuclear reactors, and 24
percent of the installed capacity (including those in Japan) is outside of
North America and Europe (Stanculescu 2011). Excluding Japan, the
rest of the world has 12 percent of the installed nuclear power capacity
(Nuclear Power in Japan 2012). Among the developing states, India has
the most significant commitment to nuclear energy, with 20 operating
reactors and six under construction (World Nuclear Association 2012b;
NEI 2012). Despite this investment, nuclear power accounts for only
2 percent of India’s electricity generation (IAEA 2010). India plans an
eight-fold increase in nuclear-generated power to 10 percent of the elec-
tricity supply by 2022, and to 26 percent by 2052. This works out to be an
annual average growth rate of 9.5 percent, slightly less than the average

global growth in nuclear generation from 1970 through 2002 (McDonald

2012). Like India, China is meeting its steeply rising demand for energy by
expanding generating capacity using all possible sources, including nuclear
power. China has six reactors under construction and plans nearly a five-
fold increase by 2020. Because it has such low generation now, even this
significant increase would result in only 4 percent of expected electricity
generation. China may eventually be a significant supplier of nuclear tech-
nology and services, especially in Asia (McDonald 2012). Despite frequent
discussion of nuclear power potential for Africa, South Africa has the only
two operating power reactors on the continent (Sokolov and McDonald
2005). In Latin America, Argentina, Brazil and Mexico each have two
reactors; Argentina has a second one under construction. No other Latin
American states have plans to build nuclear reactors (McDonald 2012).
According to the International Atomic Energy Agency (IAEA), some
65 countries without nuclear power have expressed interest in developing
it; however, few of these countries are actively planning to build reactors.
Furthermore, over half of these states have grids of less than 5 GW which
are too small to accommodate nuclear power (IAEA 2010). Most of the
growth in installed nuclear energy capacity is expected to take place in
countries with well-established programs (World Nuclear Association
2012a). The rate at which countries have adopted their first nuclear tech-
nology in the past decades has been fairly slow, with only three countries
(China, Mexico and Romania) connecting their first nuclear power plants
to the grid in the post-Chernobyl era (IAEA 2010).
Several factors discourage the adoption of nuclear energy in developing
countries. Nuclear power requires strong regulations governing nuclear
waste and decommissioning, working with international non-proliferation
agreements and organizations, and insurance for third party damage,
much of which is beyond the capabilities of many developing countries
(Emerging Nuclear 2012; World Bank 1992). Other obstacles faced by
developing countries include the need for governments to facilitate the
financing of nuclear power in a context of reduced public investment in
infrastructure (Goldemberg 2007; IAEA 1993) and the protectionism
that has typically surrounded nuclear reactor technology (Bratt 2010).
Thailand is likely one of many states whose interest was further dimin-
ished after the 2010 Fukushima (Japan) accident (Chotichanathawewong
and Thongplew 2012; IAEA 2012).
3.3.2 Renewable energy

Renewable energy sources provide an alternative to traditional fossil
fuel and nuclear energy, and can significantly contribute to developing
country energy needs. Renewable energy (RE) includes wind power, solar

power, biomass, geothermal, hydropower, and ocean energy (REN21

2012). RE can entail large, centralized electricity systems as well as mini-
grids and off-grid options. Globally, renewables provide 19 percent of
power generation, with hydro being the dominant form, accounting for 84
percent of renewables (IEA 2011b).
High income countries and multilateral organizations, such as the
United Nations Environment Program and the World Bank, have been
encouraging low-income countries to invest more heavily in RE. For
example, one of the six major U.S. policy goals for sub-Saharan Africa
is to “promote low-emissions growth and sustainable development, and
build resilience to climate change,” including “supporting the adoption
of low-emissions development strategies, and mobilizing financing to
support the development and deployment of clean energy” (The White
House 2012).
Developing countries are more likely than high-income states to use
bio-energy and to need decentralized electricity systems. Instead of
waiting for an expensive grid to come to a rural area, renewable energies
can be quickly deployed in even the most remote areas. Decentralized
generation can also help lessen the risk of massive power outages and the
resulting dependence on expensive and unhealthy diesel power, which can
cost up to 5 percent of a country’s annual GDP – a problem that affects
60 percent of the 48 countries in sub-Saharan Africa (Amin et al. 2012).
A plethora of RE projects is planned or underway throughout the
developing world. As in so many areas of energy security in the develop-
ing world, China is taking the lead on RE, now possessing the world’s
largest RE capacity. Renewable sources accounted for more than 30
percent of the 90 GW that China added to its electric capacity in 2011; of
that amount, non-hydro sources, mostly wind and solar, accounted for
about 20 percent (REN21 2012). In Latin America, Brazil leads the way
in RE, having started using sugarcane to produce ethanol in the 1970s,
though it is used mainly for fueling vehicles (Valdes 2011). Argentina
and Colombia also have established biofuels markets, while a number
of other Latin American countries have significant potential for produc-
ing biofuels for transportation but have only recently started exploring
this option (Janssen and Rutz 2011). While African states already have
a very high percentage of renewables, these are mostly from traditional
sources (wood and animal dung) that have high negative externalities.
The push is to move African states to modern RE. Kenya is one state
that has made significant commitments in this direction: by 2031 it hopes
to generate about 27 percent of its electricity needs through geothermal
energy. The African Development Bank recently committed $145 million
to one of these projects, and the World Bank along with French and

Japanese development agencies have given $500 million in loans and

grants (Manson 2012). South Africa’s Department of Energy recently
concluded the second round of bids for 19 RE independent power projects
for 1,044 MW of power using a variety of technologies, including wind,
small hydro, solar photovoltaic, and concentrated solar power (Nedbank
Capital 2012). Sub-Saharan Africa, where wood and dung are the most
common biofuels, has the greatest bio-energy potential due to its large
areas of cropland, unused pasture, and low agricultural productivity
(Watson 2008). In Bangladesh – which has installed 1.2 million rural solar
home systems – solar is the “one energy-related area in which the country
is making progress” (Ebinger 2011, 100). A micro-hydro plant initia-
tive in Nepal has led to 3,850 permanent jobs since 1998 (REN21 2012,
26). Thailand has a 15-year RE development plan that includes more
energy with wind, hydropower, biogas, and municipal waste as the source
(Chotichanathawewong and Thongplew 2012). In 2006, India created
the Ministry of New and Renewable Energy, which includes four techni-
cal institutions focused on solar, wind, biofuels and development issues.
India is now the fifth-largest wind power generator (Ebinger 2011, 33, 48;
Pachauri 2011, 100).
Renewable energy projects present a number of political and economic
challenges and tradeoffs. Government-driven initiatives require signifi-
cant research and policy making abilities, which many of the poorer states
may not have. The World Bank found that even China, with its compara-
tively strong central government, has suffered a number of challenges with
its RE projects (Xie et al. 2009; Xu 2012). In addition, RE is often expen-
sive to develop and requires government incentives, which states may have
difficulty forming and enforcing (Chotichanathawewong and Thongplew
2012). Policies to force producers to invest in renewables and to get con-
sumers to use the RE sources – such as feed-in tariffs, quota-based incen-
tives, and financial/tax-based incentives – can be effective, but applied
improperly can be costly and inefficient. Decentralized systems (off-grid
or mini-grid) combined with renewable sources can provide a lower cost
alternative for bringing energy to rural and remote settlements but gener-
ally do not make economic sense for denser areas (Deichmann et al. 2011).
Wind power requires suitable land that may be scarce in smaller states
(Chotichanathawewong and Thongplew 2012). Bio-energy presents its
own problems. Using land to grow crops for fuel rather than food can
alter domestic food prices and may end up displacing small-shareholders
(Deepchand 2002). In addition, land that could be used for biofuels may
contain significant biodiversity that would be lost (Diaz-Chavez et al.
2010). As shown from Brazil’s ethanol program, modern bio-energy can
also create significant waste products (World Energy Council 2011).

Municipal waste projects must also earn acceptance from local users
(Chotichanathawewong and Thongplew 2012).
Thus, while the strategy of increasing energy supply by investing in RE
holds long-term promise, there are a number of financial and technical
challenges that must be met, as well as tradeoffs to consider.
3.4 Diversify Import Options
While diversifying energy sources can include a broad range of issues

(Stirling 2011), in this section we focus exclusively on diversifying the
number of states from which a developing state imports fossil fuels. Many
developing states do not have significant imports, in part because they lack
sufficient energy infrastructure and have relatively few private vehicles per
capita compared to developed states. Others who have substantial energy
demands, notably China and India, are diversifying their energy supplies
to enhance security. One of the most important investments is in financing
oil and natural gas pipelines to states that export fossil fuels.
China’s energy security issues are significant and growing and have
had a global impact. In oil trade, China accounted for about two-thirds
of growth from 2011 to 2012, with its net imports rising by 13 percent
(BP-British Petroleum 2012). Until 1993, China was self-sufficient in
energy and therefore faced few risks (Bambawale and Sovacool 2011).
China now imports about half its oil, mostly from the Middle East and
Africa (Zhou et al. 2010). To increase its options and lower the risks
that arise from shipping through the various Straits (see “Protect Energy
Infrastructure” below), China has invested in, or is planning to invest
in, oil pipelines linking it directly to Kazakhstan, Russia, Myanmar and
Pakistan (Leung 2011). In 2006, despite wide-spread skepticism from
petroleum analysts, China and Kazakhstan announced the opening of the
first pipeline to deliver oil directly to China (Hancock 2009). Other invest-
ments include projects in Angola, Ecuador, Myanmar, Nigeria, Peru,
Sudan, and Venezuela (Janardhanan 2010; Jaffe and Medlock 2005). As
discussed under the “Nationalize Energy” section, China has significantly
invested in foreign oil and gas projects. China has also been developing
technology and infrastructure to create liquid natural gas which can then
be transported on ships, opening up new avenues for energy imports.
While not as invested in this strategy as China, India’s increasing
energy demands – which some expect will account for 12 percent of global
energy demand by 2030 (compared to 27 percent for China) (Thavasi
and Ramakrishna 2009) – may push India to further diversity its options.
Dependent on Gulf oil and the fluctuations that political issues in the Gulf
sometimes bring, India has reportedly been “energy hunting” in West

Asia, the Persian Gulf, Central Asia, South Asia and Asia-Pacific (Misra
2007). Brazil has also been actively pursuing energy sources in neighbor-
ing countries. It built a pipeline to transport natural gas from Bolivia to
the southern part of Brazil (World Bank 2003), and in 2010 concluded
an agreement with Peru to build multiple hydroelectric plants mainly to
serve demand in the south of Brazil, though actual construction has been
halted by protests (Brazil and Peru 2010; Outrage 2012). While this strat-
egy has been highly effective for the emerging economies, it is out of reach
for most of the developing world for two reasons: most states do not use
enough fossil fuels to warrant the significant investment required to build
pipelines and lack the domestic financing and international investment
interest to pay for them.
3.5 Build and Maintain Strategic Petroleum Reserves
Stockpiling petroleum is increasingly being considered by develop-

ing countries as a viable energy security strategy. Strategic Petroleum
Reserves (SPRs) were first established in response to the 1973–1974 Arab
oil embargo as a buffer against oil supply shortages that may threaten
economic stability (Andrews and Pirog 2012; DOE 2012). While the
largest SPRs are in Western states, a number of developing countries have
established, or are planning to establish, reserves of their own. China
has the largest reserve with total capacity of nearly 500 million barrels
(Bahgat 2011, 71). India plans to accumulate about 40 million barrels (14
days’ worth of imports) (Hook 2011). Albeit on a much smaller scale, the
Philippines, Vietnam, Rwanda, Uganda, Kenya and Zambia also have
plans for some reserves (Castillo 2011; Kojima 2009; Do and Sharma
2011, 5774).
For many developing countries, cost and management challenges are
serious obstacles to realizing their plans for SPRs. Building fuel stockpiles
is expensive – it is estimated that a 40-day reserve for India would cost $6.3
billion (Dietl 2004) – and implies an opportunity cost that can negatively
affect GDP growth in the short term and outweigh the long-term benefit
of using SPRs to smooth oil price fluctuations (Wei et al. 2008). Building
SPRs makes more sense for large countries, like China and India, while
smaller developing states may be better off implementing energy strategies
based on diversifying resources and suppliers, or limiting consumption by
reducing speed limits, banning weekend driving, reducing public transpor-
tation fares, and increasing gas taxes to reduce the demand for oil (IEA
2005).
SPRs can help developing countries maintain stable access to energy
resources in periods of short-term supply disruption. However, the costs

of creating and maintaining SPRs may not serve the long-term interests of
developing states (Yergin 2006, 1990; Goolsbee 2012).
3.6 Protect Energy Infrastructure
Another aspect of energy security is protecting one’s energy infrastructure.

This issue has recently gained enough attention to warrant a database on
such attacks (Giroux and Burgherr 2012). Critical energy infrastructure
includes electricity grids, hydroelectric dams, nuclear plants, petroleum
production facilities (oil and gas fields, wells, platforms, and rigs), refineries,
transportation facilities (such as pipelines, terminals, and tankers), distribu-
tion sites, and even corporate offices (Koknar 2009). Threats to infrastruc-
ture may originate from domestic or international terrorists, pirates, local
populations seeking direct access to energy resources for consumption or
trade with separatist or other anti-state political activists (Chaturvedi and
Samdarshi 2011; Jaffe and Lewis 2002; Giroux and Burgherr 2012).
Energy infrastructure is also vulnerable to technical problems unrelated
to political issues (Yu and Pollitt 2009; Hines et al. 2008; Lukszo et al.
2010). Technical strategies, such as increased redundancy, backup genera-
tors and early warning and load distribution systems address these threats
(Cherp and Jewell 2011). Since this is an extensive literature which moves
away from the political and economic focus of this chapter, we do not
further address technical vulnerabilities.
Petroleum products are the main energy sources transported via massive
physical infrastructure (Bateman 2003). In 2011, total world oil produc-
tion was about 88 million barrels per day, nearly half of which was trans-
ported via tankers and one-third via land-based pipelines (EIA 2012).
Maritime security remains a considerable threat to transportation and
economic stability (Komiss and Huntzinger 2011; Dannreuther 2011).
Two of the most important chokepoints for energy transportation are the
Strait of Hormuz and the Strait of Malacca. About 17 million barrels of
crude move through the Strait of Hormuz every day, while Malacca moves
15.2 million barrels a day (EIA 2012).
Energy infrastructure attracts three forms of non-government organized
attacks: piracy, smuggling, and terrorism. The International Maritime
Organization defines piracy as “any illegal act of violence or detention,
or any act of depredation committed for private ends by the crew or pas-
sengers of a private ship or a private aircraft,” and directed at another ship
or aircraft at sea (IMO 2012). For a number of economic and political
reasons, pirate attacks are on the rise (Chalk 2008; Sinai 2004). Pipelines
have long been targets of smuggling operations. Crude smuggling in
Nigeria and Iraq offer examples of heightened sophistication in both

method and organization, and the burdens it places on host governments

and corporations (Ikelegbe 2005, 221; Onuoha 2008). In Nigeria, Shell
reported losing 100,000 barrels a day in 2003, translating to a nearly 10
percent reduction of Nigeria’s total production and costing companies
and the host country millions of dollars (Oduniyi 2003). In Iraq, some
reports suggest that nearly 40–50 percent of the revenue from smuggled
oil in 2006 was pocketed by insurgents (Wahab 2006). Since 1986, persist-
ent attacks on Colombia’s Caño Limón pipeline – 950 attacks as of 2004
– have cost the government $2.5 billion in revenues and have cut supplies
for months (Parfomak 2004, 4). Terrorism magnifies threats to energy
infrastructure (Chalk 2008, 24–25; Luft and Korin 2004). Cyberterrorism
presents an additional threat, particularly against critical outdated infra-
structure, which is more common in the developing world (Sheldon et al.
2004; Oliveira 2010). Environmental disasters caused by infrastructure
accidents can also damage long-term economic growth, with potentially
lasting effects on ecological systems (O’Rourke and Connolly 2003; Amin
and Gellings 2006). Finally, massive political instability and even coups
can threaten infrastructure, such as in Libya, Syria, Egypt and Yemen
(Giroux 2012).
Strategies to counter energy infrastructure threats can be as complex
as regional cooperation or diversifying maritime transportation through
development of land-based transportation (Blank 2009), and as simple
as providing locks and antipiracy training (Rosenberg 2009, 47–48). To
avoid piracy and international conflict disruptions, China is transiting
from maritime imports to land-based imports from Central Asia (Sheives
2006; Chung 2004). Military build-up is also an option, but this strategy
can threaten the tenuous balance of maritime sovereignty (Cole 2008) and
power stability (Kaplan 2009; Ball 1993–1994). Indonesia, Singapore and
Malaysia have attempted to increase cooperation in combating piracy,
and Japan and India have proposed larger-scale naval patrols of the Strait
of Malacca. Naval intervention, however, breaches the sensitive issues of
(imperial) militarism in the region, as well as unresolved territorial issues
(Mo 2002). Africa faces similar complications in collective attempts to
address piracy and smuggling, especially with regards to commitments to
international law (Gibson 2009; Baker 2011). Some of these threats are
addressed by strategies discussed elsewhere, such as using RE sources to
avoid relying on maritime and pipeline deliveries.
3.7 Increasing Efficiency
Many developing countries include energy efficiency as a critical strat-

egy for reducing demand, or keeping it from growing as fast as it

might otherwise, and thus enhancing security (Chotichanathawewong

and Thongplew 2012). In China, where energy efficiency has “been on the
agenda” for decades, improved efficiency enabled the state to only double
energy demand while GDP quadrupled since 1990 (Bambawale and
Sovacool 2011). Brazil has an extensive energy efficiency labeling program
to inform consumers about long-term electricity costs for various prod-
ucts. A review of 119 projects covering nine manufacturing sub-sectors in
developing states found substantial efficiency gains (Alcorta et al. 2012).
However, while about two-thirds of the available opportunities for energy
efficiency investments are in the developing world (Farrell and Remes
2009), many companies likely remain uninformed about the opportunities
(Alcorta et al. 2012). In addition, two factors that are a significant chal-
lenge in the developing world are seen as critical to the success of energy
efficiency strategies: generating consumer demand for efficient products,
and building consumer confidence and trust in labeling schemes (Ellis et
al. 2009). Access to local financing is considered another major obstacle
to greater efficiency in developing states (ESMAP 2006). For many states,
such as India, price subsidies discourage investments in fuel-efficient tech-
nologies (Ebinger 2011, 51). Finally, states and international organiza-
tions need to improve data collection to better understand consumption
patterns and to develop state-of-the-art indicators to better inform policy
making (Trudeau and Taylor 2011).
4 CONCLUSIONS
Developing states – a very broad category in terms of population, territo-

rial size, income levels, and status in the international system – pursue a
variety of strategies meant to enhance their energy security in terms of
access to supply. In this chapter, we have summarized a variety of strate-
gies that appear most frequently in the literature on the developing states
and energy issues. To illustrate these strategies, we mention cases through-
out the developing world providing some historical background and high-
lighting some of the issues states face as they pursue these strategies. We
draw a number of conclusions from our research.
First, nearly all of the strategies we discuss are actively employed by
developed states as well as developing states. This does not mean that all
developing states are equally equipped–in terms of financing means and
state capacity–or even committed to implementing the individual strate-
gies. In addition, developing states often have a different focus than the
highly industrialized, wealthy states due to the high percentages of people
who lack access to electricity and the states’ long-term focus on industrial

development. For example, scholars caution that energy efficiency may

be low on the agenda for many developing states, whereas it has become
more important in developed regions.
Second, the energy mix in the developing states looks very different
from that in developed states. For example, in much of Africa and parts of
Asia, RE comprises a majority of the states’ energy resources. However,
much of the RE is from traditional sources – wood and sometimes animal
dung. The challenge is thus to move to modern sources, such as solar and
wind, and even more advanced and/or sustainable forms of biomass, such
as industrial waste or plentiful cassava.
Third, the energy needs of developing countries will require massive
injections of capital that cannot be obtained without private sector par-
ticipation. However, the experience of the last three decades with FDI and
privatization has led developing country governments and international
development agencies to reconsider the role of the state in steering private
investment towards fulfilling long-term development goals. In many coun-
tries, private investment flows have proven insufficient or inadequate to
achieving these goals. As a result, some countries have partially returned
to state controlled energy strategies. Given conditions of high energy
prices and private financing constraints we should expect energy national-
ism to remain an attractive strategy for larger countries with active NOCs
as well as smaller countries with resources to protect.
Fourth, some of the strategies appear to be endorsed and advocated
far more by international organizations (such as the World Bank and the
United Nations Development Program), Western states (particularly the
US and the EU), and industry groups (such as the World Alliance for
De-centralized Energy) than by the developing states themselves.
Fifth, while it is often not discussed in the literature, particularly by
those advocating for the policies, the lack of state capacity remains
a significant issue for many developing states. Adequate regulation,
designing long-term energy policies, and orchestrating new investments
while keeping energy at affordable prices require significant government
capacity, which not all developing states can supply.
Sixth, as the only major rising power with global reach and ambitions,
China’s strategies often have more in common with the developed than the
developing states. India and Brazil also have options open to them that
are out of reach for others. A repeated theme in the strategies section is
the cost of these strategies, many of which are beyond the means of most
developing states and raise issues of opportunity costs. If states invest
in nuclear energy, what other basic human needs might be sacrificed?
Furthermore, are there more cost effective measures? For example, when
one compares the costs of building and maintaining a strategic petroleum

reserve to reducing fuel demand through taxes and lowering the speed
limit, the former strategy seems a poor use of funds.
Finally, we identify areas for future research. In the existing literature,
few authors discuss developing state strategies as distinct from developed
state strategies and few compare cases within the developing world.
Research that focuses on groups of countries according to their size
(both territorial and economic), energy resources, and level of develop-
ment would provide a better mapping of energy issues and strategies.
Research that includes local print sources and interviews of govern-
ment officials and individuals in the private energy sector of developing
countries is also necessary to distinguish the agenda of developing states
from that of external actors, in particular with respect to the pursuit of
alternative sources of energy, such as renewables and nuclear. Another
promising avenue of research is on the role of sub-national govern-
ments and non-state actors in promoting the development of alternative
sources of energy. State strategies at the national level tend to focus on
large infrastructure projects while most of the off-grid and alternative
energy projects are sponsored by international agencies, NGOs, and
community-level organizations with goals and agendas that coexist but
can also be at odds with those of the national government. This situa-
tion is specific to developing countries, where infrastructure is not fully
developed and integrated and the presence of the state throughout a
country’s territory can be uneven. Research in this area would help us
better understand the conditions under which particular energy strategies
are formulated and deployed.
NOTES
* The authors thank Margaret Albert for her excellent research support for this chapter.
1. For a detailed discussion on defining energy security, including an analysis of 45
definitions, see Sovacool (2011).
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PART IV
SECURITY OF ENERGY
DEMAND

11. Energy demand: security for suppliers?
Tatiana Romanova
1 INTRODUCTION
The vast majority of papers on energy security look at it from the con-
sumer’s point of view, making security of supply the key preoccupation.
However, this volume is an excellent illustration that energy security is
an ‘umbrella term’, covering ‘many concerns linking energy, economic
growth and political power’ (Westminster Energy Forum 2006, p. 9).
Preoccupations of suppliers are not new; they emerged in the 1980s and
have grown in scope ever since. These interests and concerns are expressed
by both individual producing countries and by organizations that bring
them together.
Demand security is frequently portrayed as the other side of the energy
security medal, the side which was overlooked for a long time. Most
decision-makers and analysts currently agree about the interconnected-
ness of supply security and demand security. A vicious circle emerges, for
example, when high prices lead to the decline in demand and, therefore,
limit the will of producing countries to invest in new production facilities
and in infrastructure bottlenecks. ‘The disincentive to invest then creates
the roots of the next oil price shock once oil demand recovers’ but the
capacities to feed the demand remain limited (Fattouh and van der Linde
2011, p. 12). Another vicious circle emerges when prices are too low, they
constrain opportunities for bringing into operation new oil and gas fields
or ways of their transportation. As a result, the increase in the demand for
oil and gas cannot be met and this leads to a price hike.
Cooperation of producing and consuming countries is needed to
convert these vicious circles into virtuous ones. In other words, energy
security is about cooperation and interdependence rather than about con-
frontation and zero-sum games. Liberalism and institutionalism are more
appropriate perspectives for energy demand security than international
relations realism. However, understanding producing countries’ objec-
tives and their feasibility is a pre-requisite for the application of liberal
and institutional perspectives. This chapter seeks to achieve that under-
standing through analysis of key documents (energy strategies, doctrines,
concepts) and speeches and declarations of representatives of key oil and
gas exporting countries (see Table 11.1).
239

Table 11.1 Key oil and gas exporting countries1
Net oil export, billion t Net natural gas export, billion m3

2010 2011 2010 2011
Saudi Arabia 343.4 398 Russia 174.8 182.4
Russia 376.2 375.4 Qatar 96.3 130.6
Kuwait 103.7 121 Norway 102.3 97.4
UAE 102.5 119.6 Canada 64.9 55.7
Iran 117.3 118.8 Algeria 57.3 50
Venezuela 105.6 101.3
This chapter will first look at how the concept of demand security came
about and how it evolved. It will then examine in more details requests
of consuming countries. Finally, the chapter will analyze the means that
producing countries use to ensure demand security. Both the requests and
the means to meet them are classified in two groups (economic and politi-
cal). The term ‘political’ is preferred to ‘geopolitical’, which is frequently
used in this context, because it embraces not only geopolitical ambitions
of producing countries but also such instruments of traditional interna-
tional relations like dialogues among producers or between producers
and consumers, as well as efforts to induce new international legislation.
In sum, ‘political’ for us includes both realist and liberal institutionalist
approaches.
2 HOW DID THE CONCEPT OF DEMAND

SECURITY DEVELOP?
The peculiar needs of producing countries had already been recognized by

the experts’ community in the 1970s, at the start of the current studies of
energy security, although they did not immediately become the focus of
political interaction. The needs of exporting countries were defined then as
sovereignty over resources and granted access to consumers abroad (see,
for example, Willrich 1975).
OPEC members first made requests for demand security in the 1980s.
That was the result of the two oil crises of the 1970s, which encouraged
European consumers to drastically reduce their energy consumption.
Demand security in the 1980s boiled down to price stability and amounts
to be exported. It was also limited to oil, a commodity which at that time
was globally traded. Demand security has been present in both political
agendas and experts’ deliberations from that time on.

Energy demand: security for suppliers? 241
The 1990s made the arguments and concerns of oil producing countries
more sophisticated. Firstly, instead of arguing only about a fair price,
they made a link between the cash flow and their propensity to invest in
upstream business as well as in transportation and oil processing. In other
words, they connected concerns of exporting countries and the long-term
supply stability of consumers. Moreover, rather than arguing about a fair
price, consumers and producers introduced at the Third International
Energy Conference in 1994 the notion of price stability, which is mutually
beneficial for both sides. They underlined that:
price stability is a key concern for the energy security from the point view of
both consumers and producer countries. It is therefore necessary to enhance the
study of the limits of that reasonable price level in order to identify the range
that would provide for common benefits and at the same time, avoid the risks
of price volatility for both consumer and producer countries. (Fattouh and van
der Linde 2011, p. 65)
In other words, an effort was made to make energy security a cooperative

game as opposed to relying on a zero-sum approach.
Secondly, environmental arguments moved in the forefront of the
discussion in the 1990s. On the one hand, traditional sources were
undermined due to their environmental impact; in particular, produc-
ing countries objected to energy taxation, which discriminated oil as a
polluting source. On the other hand, European countries progressively
encouraged development of renewable sources of energy, deemed more
climate-friendly and at the same time decreasing their external depend-
ence. It is, therefore, noteworthy that the Saudi Minister for Petroleum
and Mineral Resources defined producers’ security then as ‘continued
access into the markets of oil importing countries, the steady share of
oil in total energy consumption over the long term, and fair and stable
prices that allow for their sustainable development over the lifetime of the
resource’ (Fattouh and van der Linde 2011, p. 61).
Besides, the 1990s also saw the emergence and beefing-up of the
International Energy Forum (IEF). It brought together key oil exporting
and importing countries and enabled their dialogue on oil trade. Hence,
the first institutional structure to promote permanent policy interaction
between consumers and producers emerged; it also became the venue,
which strived to find the balance between the two sides of the energy secu-
rity medal (between supply and demand concerns). Ultimately it facili-
tated an approach to energy security as a cooperative game, which takes
into consideration the demands of suppliers and consumers.
Finally, towards the end of the 1990s the discussions on demand secu-
rity broadened to gas due to its liberalization, which started in the US

and UK and then made its way to Europe. Liberalization in consuming

countries raised producers’ concern due to unbundling, which undermined
their ownership of some pipelines beyond their territory, as well as due to
the changes in long-term contracts, which consuming countries requested.
Gas demand security debates, however, remained fairly tacit until the turn
of the millennium because initial liberalization meant only information
transparency whereas unbundling (division in production, transportation
and distribution) was implemented through the division of management
and through clear costs’ allocation. In 2002 gas discussions were incorpo-
rated into the agenda of the IEF.
The turn of the new millennium ushered further developments of the
demand security debates. The IEF expanded the linkage between prices
and their volatility, investments and a fair share of hydrocarbons in the
market. These debates ‘were given more content’ because they included
‘issues of policy uncertainty, data transparency, human capital short-
ages, the IOC-NOC relationship and the role of technology’ (Fattouh
and van der Linde 2011, p. 116). However, environmental issues remained
relatively low-profile, presumably because ‘parties wanted to avoid con-
frontational topics and focus more on themes that can bring them closer
together’ (Ibid).
At the same time, a new line of debates emerged outside of the IEF.
Oil producing countries increasingly applied development arguments to
justify high prices and guaranteed volumes of export. On top of economic
pragmatism (mutually beneficial for exporters and importers price stabil-
ity and guaranteed investments), they applied a normative justification.
They argued that revenues from the sale of hydrocarbons are crucial for
their development, for social inclusion and stable employment. It is telling,
for example, that the head of the Energy Studies Department of OPEC
Secretariat, Mohamed Hamel, interpreted that energy is a two-way street
in the following way:
On the one hand, oil is important to the economic growth and prosperity of
consuming/importing countries, but on the other hand it is also crucial to
the development and social progress of producing/exporting countries. For
example, while net oil imports in OECD countries account for around 60
per cent of their total demand, oil exports from OPEC’s Member Countries
account for no less than 77 per cent of their total exports, and for some of them,
more than 90%. (Hamel 2007)
This line of arguments can be seen as offsetting the normative environ-

mental logics of developed countries, which mostly happen to be consum-
ers (Norway provides a noticeable exception here).
However, the most tangible development in the concept of demand

security that came in the new millennium is not from the oil sector but
from that of natural gas. Two developments facilitated it. Deepening
of liberalization was the first one: as the time passed unbundling in key
consuming markets was increasingly about organizational independence
of upstream, midstream and downstream businesses, and eventually
about legal and ownership separation. That development meant that gas
suppliers progressively were stripped of the guaranteed consumption,
which underlined the very development of the industry. Secondly, the first
decade of this century also saw a drastic decrease in the costs of liquefied
natural gas (LNG). Its significance lies in the fact that it makes redundant
costly pipeline infrastructure and converts previously closed and separated
regional gas markets into one global one.
Given these developments, gas moved into the forefront of the demand
security debates. It is noteworthy that the IEF held a specialized ministe-
rial forum on gas in November 2008. But even before, at the start of the
century, key gas producing countries beefed up their efforts to promote
demand security, and Russia has so far been the most active player in this
game. This later development is not surprising given the fact that Moscow
is by far the largest producer and exporter of natural gas in the world. The
country also relies on the revenues from the sale of oil and gas to carry out
domestic reforms and fulfill its numerous other social obligations.
Russia’s urge to assume the leading role among gas producers was also
fed by its ambitions to stay among key world players at the time when
some prerequisites for it (in particular, economic strength and ideologi-
cal, normative appeal) were missing. It is worth mentioning, for example,
that President Vladimir Putin has repeatedly stated the goal to achieve
Russian leadership in the context of global energy security (see Putin
2005). Current Russian energy strategy notoriously stresses the need ‘to
ensure the contribution of the energy sector into improvement of foreign
economic activities and to reinforcement of Russia’s positions in the world
economic system’ (Russian Federation 2010, p. 14–15).2
Russian activity served to increase the perception that energy security is
an issue of mutual dependence because it has emphasized cooperation and
shared responsibility.3 Firstly, it involved a larger array of international,
non-energy specialized organizations (G-8, G-20, OSCE, UN, APEC). It
meant that the number of arenas for the discussions on demand security
was increased and awareness on this issue grew. Moreover, it was intro-
duced into the agenda of developed countries, the majority of which were
net consumers. Gradually most fora recognized the ‘mismatch between
security of supply and security of demand’ (OSCE 2010).
Secondly, Russia contributed to the change of the definition by putting
in the agenda the term ‘global energy security’ during its G-8 presidency in

2006. The new discussion stressed the ‘interdependence between produc-

ing, consuming and transiting countries’, the indivisibility of energy secu-
rity into that of exporters and that of importers (G-8 2006). It also made
central the ‘development of transparent, efficient and competitive global
energy markets’ as well as ‘enhanced dialogue on relevant stakeholders’
perspectives on growing interdependence, security of supply and demand
issues’ to achieve energy security (Ibid).
The G-8, of course, lacks legitimacy as a forum for the full-scale
dialogue between consumers and producers (primarily because many sup-
pliers are absent but also because it is not an international organization
but rather a discussion club). Therefore, it made several references to the
IEF as a venue for further elaboration.
The reason for Russia introducing the global energy security as a point
of G-8 discussions was not tactical, ‘to recover its tattered reputation’
following the 2005–2006 transit conflict with Ukraine and interruption
of supply (Van de Graaf and Westphal 2011, p. 22) but rather strategic.
Russia used the new term (global energy security) to challenge existing
legal obligations (i.e. Energy Charter Treaty), which it believed to favour
consumers over suppliers. It shifted the discussion from the contrasting
of two terms (supply security and demand security) to the holistic idea
of global energy security, to a more cooperative game. This shift enabled
Russia to introduce a new conceptual approach in 2009 and a draft
convention on energy security in 2010.
Thirdly, Russia has sought to modify some international legal instru-
ments to take into account the needs and priorities of producers. It
famously refused to ratify the Energy Charter Treaty, which it perceived
as the document privileging consumers over producers. In 2009 President
Dmitry Medvedev suggested an alternative legal regime (Medvedev 2009),
which became the basis for the draft Convention on global energy security.
This later document defined global energy security as:
the state of world energy system, which guarantees steady and uninterrupted
supply of consumers with energy materials and products on the conditions,
which satisfy all market participants with minimal environmental impact and
pursuing the goal of sustainable socio-economic development of the global
community. (Shtilkind 2010).
The draft also contained such principles as interdependence, equal respon-

sibility of producers, consumers and transit countries, fair distribution
of risks and balance of all interests (Ibid). It, therefore, incorporates
the interests of producing and consuming countries. Russian activity
also prompted modernization of the Energy Charter process (the rel-
evant process was launched in 2010 and reflected the ideas, promoted by

Moscow, including the concept of global energy security (Energy Charter

Secretariat 2010)).
In sum, Russia contributed greatly to raising awareness about demand
security. It also diversified arenas of this discussion as well as the ways
of promoting this concept. Interestingly, however, Russia has never
attempted either to expand the normative definition of demand security,
which OPEC countries worked out (contribution to social and develop-
ment goals) or to change it. Rather, in its internal documents (Russian
Federation 2003, 2010) Moscow adhered to western normativity (meaning,
environmental protection and energy efficiency) and argued that although
energy sector is important in terms of revenues it brings to the budget, the
ultimate goal is modernization and a drastic reduction of the share of oil
and gas in the GDP. This attitude, in fact, reflects the ambiguous position
of Russia, which strives to straddle the two worlds (that of oil and gas pro-
ducers and another one, composed of developed states). It is also an excel-
lent illustration of the fact that Russian normativity is embodied in an
immediate and pragmatic economic action rather than in abstract issues.
The increasing concern about demand security for natural gas also
encouraged key producing countries to coordinate their activities. In 2001
they set up an informal Forum of Gas Exporting Countries (FGEC),
which was transformed into a fully-fledged international organization in
2008.
Thus at the time of writing, in 2012, the concept of demand security has
been quite developed and was integrated into the concept of global energy
security. It included both oil and natural gas, both economic and politi-
cal aspects. These later elements are analyzed in more details in the next
section.
3 WHAT DO SUPPLIERS WANT WHEN THEY TALK

ABOUT DEMAND SECURITY?
Two observations are to be made before we discuss bits and pieces of

demand security. Firstly, producing countries are different in the extent
they promote various parts of demand security. At least three factors
influence their propensity to defend demand security. These are the degree
of their integration in the western world (or the wish to be there); the
dependence on oil and gas revenues; and the ability to supply resources to
global market. For example, Norway promotes environmentally-sound
energy sectors and stresses that stable supply is its international respon-
sibility rather than defends demand security. Russia has always restated
western arguments on energy efficiency and environmental safety. At the

same time the western concern about the supply stability and credibility
of Moscow stimulated the latter to underline the importance of export
markets stability. OPEC countries, Canada and Algeria have also been
extremely vocal in defending their right to access consuming markets. On
the other hand, Iran has been practically silent due to its increasing domes-
tic demand, which challenges its ability to export as well as the increasing
number of international sanctions against it.
Secondly, some experts contrast oil and gas producers’ reasons to seek
demand security. It is true that gas is more dependent on fixed infrastruc-
ture than oil (the amount of LNG is still limited and it presents a commer-
cially viable option only on long distances), and hence redirection of gas is
more complex. Furthermore, oil ‘producers can add value by refining oil
but gas-value is location specific’ (Ghilès 2009). Finally, while oil produc-
ers use demand security to justify low investments in production capacities
(see Jesse and Van der Linde 2008), gas producers are mainly interested in
maintaining their share in the market and fear the competition from other
fuels (El-Katiri 2010). These variations are worth pointing out as they
shape the specificity of demand security concerns in oil and gas sectors.
However, the elements of demand security are the same for oil and gas
sectors. They are structured below in economic and political groups.
3.1 Economic Concerns
Five economic aspects stand out in the demand security, requested by pro-
ducing countries. Price stability is the first, and, possibly, the best known.
Current discussion is not so much about a fair price but rather about con-
tained price volatility. This latter is the effect of both physical problems
with supply and demand (due to economic recession, availability, infra-
structure disruptions, etc.) and the intricate work of financial markets,
which are frequently ‘detached from supply and demand fundamentals’
(Salem El-Badri 2011, p. 2).
Both excessively high and excessively low prices are harmful, as the
introduction to this chapter pointed out. The first affect the demand
and encourage consumers to look for alternative sources. Moreover, the
higher the prices for oil and gas, the more attractive are renewable sources
and energy efficiency technologies. Low oil prices, on the other hand,
question the security of supply because they discourage producers from
investing in new fields and transit capacities. They also raise the concern
of whether idle capacities are needed and who should pay for them. On
the consumers’ side they also undermine ‘conservation and climate change
agenda’ (Fattouh 2012).
A particular concern of gas exporting countries is the price-setting

mechanism. For a long time gas prices were linked to oil prices; the histori-
cal reason is that gas was not traded freely and globally but was viewed
as a substitute to oil. However, the development of spot markets for gas
as well as the use of LNG for price arbitrage between various regions of
gas consumption have created preconditions for independent gas pricing.
Currently most long-term gas-supply contracts presuppose an oil-related
price formula whereas short-term trade is based on spot prices, the latter
most of the time being lower compared to the long-term prices. Hence,
consumers would like to change the price mechanism whereas produc-
ers (especially, Russia and Algeria) would prefer to maintain the existing
practice.
Stability of oil and gas consumption is another key challenge for today’s
producers. It is affected by a number of factors. One is temporary and
relatively short-term: the results of 2008 financial crises are still felt; the
lack of growth means, in turn, a depressed energy demand. Another trend,
which affects the stability of oil and gas consumption, is more long-term.
It stems from the efforts to instill the so-called green economy, which con-
sists of increases in energy efficiency and the development of renewable
sources of energy.
The benefits of green economy are two-fold. They reduce the depend-
ence of importers on foreign supply and hence, from the classical realist
point of view, increase their national security. On the other hand, they also
mean new local, knowledge-intensive production and, by consequence,
additional employment possibilities. Moreover, ‘the renewable energy
market is flexible, with greater opportunities for smaller, independent pro-
ducers to phase into the energy markets using smaller scale investments’
(Boëthius 2011). In sum, the advantages are diverse and numerous, but
not for producers of traditional sources of energy.
There is also a technical concern here. It is particularly acute for the
natural gas sector: once a gas field is put into operation it is impossible
to stop the flow. Hence, producers can interrupt the supply for as long
as they have storage capacities. Then, if consumers are still not interested
in their gas, exporters can either divert the flow or start burning it. As a
result, demand insecurity makes the supplier a hostage of the consumer.
The good news for oil and gas exporters is that renewable sources of
energy cannot fully substitute oil and gas (with the possible exception of
small Scandinavian economies). More good news lies in the low accept-
ability of nuclear energy today, which is the result of both the Chernobyl
and the Fukusima disasters. Nor can nuclear power stations be fully sub-
stituted with alternative sources of energy.
However, the stability of consumption remains uncertain. It is for this
reason that they request that future policies ‘ensure that all sources of

energy, including oil and gas, are part of a balanced future energy portfo-
lio’ (Hussain 2012).
The third concern, which is linked to the discussion on the stability of
demand is that of (un)just taxes in importing countries. In part, they are
used to level price fluctuations for final consumers. However, many pro-
ducing countries also believe that as a result exporters reap a part of their
rent, depriving them of the resources, which could be used for the develop-
ment and social cohesion. Russia has also argued against import taxation
because it results in higher prices for final consumers, which producers are
ultimately blamed for. It is for this reason that Russian draft convention
on global energy security suggested inter alia to ban all import taxes and
duties (but also to preserve all export ones).
Furthermore, some taxes are also introduced to encourage consumers
to shift from one energy source to another. This strategy is frequently used
to subsidise renewable sources of energy with the revenues, collected from
dirtier (in terms of green-house gases and other environmental impacts)
traditional sources of energy. Producers frequently argue, however, that
‘increased use of fossil fuels is consistent with the protection of the envi-
ronment, through the development and dissemination of advanced cleaner
fossil fuel technologies, and in particular the promising technology of
carbon capture and storage’ (Hamel 2007). Furthermore, Moscow has
also suggested – to no avail – that natural gas environmental soundness is
to be recognized and upheld in the EU’s tax regime.
Stability of regulation on consumers markets is another source of
concern for producing countries. It is especially pronounced for gas
exporters, who increasingly face the results of gas liberalization, especially
in the European markets. Russia inter alia voiced its unease about the
ownership rights on the infrastructure, which Russian (or Soviet) com-
panies have constructed or still plan to build. Suppliers have consistently
tried to prove that as a result the EU will soon face the deficit of infrastruc-
ture investments (the Californian crisis is frequently cited as an example).
Moscow also questioned the legitimacy of unconditional third-party
access, which undermines both its ability to sell its gas and, ultimately, the
security of supply of consumers in the European market.
Finally, suppliers (especially in gas) are uncomfortable about competi-
tion in their export markets. They would much prefer exclusive contracts
and a guaranteed access to final consumers. However, what is even more
annoying to them is unfair competition. This later emerged as a result
of discriminative taxation or instability in the regulation in their export
markets.
These five economic concerns of exporting countries frequently make
them classified as supporters of the Beijing consensus, emphasizing the

role of the state in economic relations as opposed to more liberal consum-

ing countries, oriented towards Washington consensus and ultimately free
markets (see, for example, van der Linde 2005). The reality is, however,
more complex. Greater state interference in the economy of the majority
of producing countries is the fact of life. However, what producing coun-
tries would like to see is not a similar ownership / regulation structure in
consuming countries. Rather, they encourage shared responsibility and
markets, which are not distorted by the normative logics of the west (i.e.
by the wish to limit their supply dependence and to promote renewable
sources of energy at the expense of traditional sources of energy).
Another interesting argument, which has been raised by representatives
of the OSCE, Energy Charter Secretariat, is that supply security requires
only technical adjustment by governments (in the form of ‘binding mul-
tilateral rules on investment, transit, resources’ (Dickel 2009)) whereas
demand security is something that governments cannot guarantee because
it is up to the markets to define the overall demand, the role of various
resources in the energy mix as well as access to markets (Ibid). The reality
is, however, that these market choices are distorted by the deliberate
government regulation (including taxation). This is not to say that it is
a wrong choice but rather to underline that both demand security and
supply security are a combination of market choices and government
regulation and, therefore, can be equally affected by public authorities.
3.2 Political Concerns
Political concerns of energy exporting countries, linked to demand secu-

rity, are a logical continuation of economic concerns. They have already
been mentioned before, and therefore deserve only a brief summary here:
1. Demand security guarantees stable revenues for national budgets: this

money is mostly used to finance the development of producing coun-
tries, their improved social cohesion, education of local population,
and modernization of their economies. Thus the revenues have a goal,
which goes beyond the economic one. At the end of the day the very
stability of exporting countries hinges on the stability of oil and gas
money flows.
2. Suppliers are interested in the development of a new legal regime (or
adjustment of the present one) in a way that takes their interests into
consideration: as depicted in the first part of this chapter, Russia has
been particularly vocal and active in pursuing this way.
3. Finally, supplying countries are against any form of politicization of
energy relations: Russia has consistently argued for more business-type

relations in the field of gas and perceived the wish of the EU to reori-
ent its contracts towards alternative (and more expensive) suppliers of
natural gas as a political rather than an economic step. Alexei Miller,
the CEO of Gazprom, has famously argued that his company ‘is not
afraid of competition’ but that he feels that ‘competition should be
honest, rational, without any discrimination, not distorted by any
political, bureaucratic and ideological factors’ (Miller 2012). Other
countries (like Iran) have also voiced their concern about boycotts as
a political weapon to put pressure on their ruling regime.
In sum, political concerns are a continuation of the economic ones.

They are not independent, rather they are meant to support the economic
concerns and thus perform an auxiliary function.
4 WHAT INSTRUMENTS DO SUPPLIERS APPLY?
The means that producers use to further demand security and that can be
applied by consuming countries can also be structured in economic and
political groups. Again, the classification is more for the purpose of clarity
because political tools just elaborate and enhance economic ones.
4.1 Economic Means
At least five economic leverages are used by suppliers to defend their

interests. Storage facilities for both oil and natural gas and spare capaci-
ties to produce oil are the first, rather technical ways that producers use.
These instruments are helpful to offset short-term (daily and seasonal)
fluctuations in demand, sharp hikes and falls in prices and so on. Some of
these facilities go beyond the needs of an individual supplier and acquire a
global dimension. This is particularly the case with the Saudi spare capaci-
ties. As an unnamed industry official of this country said, ‘Saudi Arabia
will always play a balanced role in supplying global demand’ (Reuters
2011). The regulation of volumes of export has a proved record of success,
although the exact correlation between volumes and price fluctuations
remains a topic of discussion.
Both storages and idle capacities represent considerable investments
that do not pay back immediately and rather represent a global public
good (particularly when they are used to smooth price volatility). Hence,
the question has always been who is to pay for them and how to share
the price between consumers and producers in a fair manner (for a recent
discussion see, for example, Bodro Irawan 2012).

Another classical way to guarantee a predictable price in the field of

natural gas is a long-term contract. It came into being in the 1970s and ever
since it has served the basis for the majority of trade in gas. The attractive-
ness of long-term contracts lies in the fact that they guarantee certain con-
sumption for a period of about 20 years. If an importing country does not
need that amount of gas, it still has to pay for it (this is the notorious take-
or-pay obligation). As a result long-term contracts guarantee a predict-
able cash-flow, which is essential to make costly investments in upstream
business and transportation. These contracts also served as a guarantee
for credits, used to develop new fields and construct pipelines and other
infrastructure. Russia is a particularly vocal supporter of these contracts,
which is reflected in its current energy strategy (Russian Federation 2010)
as well as in its conceptual approach to global energy security and draft
convention on global energy security (see Medvedev 2009, Shtilkind 2010).
Some experts suggest that individual countries (big and prospective
consumers like China or India) can also use this practice of long-term con-
tracts in oil business and ‘index the price to signals generated elsewhere in
the world’ (Luciani 2011, p. 13).
Control of transportation routes is yet another way to secure the demand.
This strategy mostly works for natural gas, which relies on fixed infrastruc-
ture, too costly to duplicate. For example, Russia has effectively denied
third-party access to its gas pipelines (both in bilateral negotiations and in
the talks on the Energy Charter Treaty and on its accession to the WTO).
This allowed Moscow to regulate access of Central Asian resources to the
European market. Another interesting strategy was adopted by Russia
when negotiations on Nabucco (a gas pipeline that would link Central
Asian gas to Europe bypassing Russia) started. Moscow did its best to
contract the majority of resources in the region thus making investments
in the Nabucco pipeline commercially unattractive.
Producers regularly try to offset or correct the changes in the regulation
of consuming countries, which disadvantage them. An array of various
measures is applied for that. Most recent activities have taken place in
the gas domain with the view to adapt to the liberalization process. Two
approaches have been applied.
The first is to defend the interests of relevant national companies in the
new legal environment. Both Russia and Algeria have actively searched
an access to EU’s consumers. It guarantees them export markets, acts as a
safeguard against prospective increase of competition and heightens their
profit (the largest margin of profit is believed to be reaped in the so-called
last-mile of supply). In order to get this access they bid for distribution
networks but also invite energy companies of importing countries to par-
ticipate in the development of new gas fields on their territory in exchange

for their share in the distribution market (the strategy of assets-swap). They
also frequently apply the concept of reciprocity in the access to reserves
and consumers to defend their position. The purchase of distribution net-
works by gas-developing companies is, however, increasingly against the
legislation, prescribing unbundling in the majority of consumers.
The second is to encourage importers to fine-tune their legislation in a
way which is favourable to producers. International legislation is mostly
used for that. Russia has also exploited Energy Charter Treaty’s clause
on the protection of investors to claim that consuming countries cannot
force foreign companies to sell their stakes in the transit and distribution
business. These clauses were also included in the Russian suggestions on
how to improve global energy security (Medvedev 2009, Shtilkind 2010).
Finally, all producers actively apply the strategy of diversification to
hedge their stakes and to balance the desire of consumers to decrease
their dependence on oil and natural gas. One variant is to diversify export
markets. For example, at the 2006 G-8 meeting in St. Petersburg Russia
made known its intention ‘to increase oil exports to Asian countries from
3% to 30% by 2020 and gas exports from 5% to 25%’ (RIA Novosti 2006).
This goal was repeated in the 2009 energy strategy of the country, although
the indicators were adjusted to 22–25 per cent and 19–20 per cent for oil
and gas respectively (Russian Federation 2010). Interestingly, Russia also
tried to encourage Qatar to move to Asia to diversify its markets. This is,
however, a strategy, which aims not so much at the increase of profit of the
largest LNG producer but rather at the protection of Russian share in the
European gas market (see Hulbert 2012).
Asian markets clearly present a very lucrative opportunity for both
oil and gas producers due to their growing consumption, which by far
outstrips that of European states. However, there is a fly in the ointment,
and that is much lower prices in the most populated part of the world,
compared to the revenues that can be reaped in Europe.
The aim of the geographical diversification, from the producers’ point
of view is to return to the situation when consumers compete for resources
as opposed to the competition among exporters. In a way, this diversifica-
tion race has already brought some results:
Already, Europe has to compete for LNG flows from other gas-rich regions.
Moreover, Europe is now effectively competing for new gas developments in
Russia with other consuming countries because Gazprom does not have an
unlimited capacity and capability to develop very many large projects all at
once. (Van der Linde 2007, p. 17)
Another approach is to diversify energy production. A curious trend is

the interest of oil and gas producers to renewable sources of energy. For

example, Algerian Sonatrach ‘launched a business line to harvest power

from the sun’ (El-Katiri 2010, p. 15); the aim is to become a world leader in
the production and export of the solar energy. The decision is clearly based
on a good understanding of today’s energy trends. It is also noteworthy
that the CEO of New Energy Algeria (partly owned by Sonatrach) under-
lines that his country’s ‘potential in thermal solar power is four times the
world’s energy consumption’, which allows it to ‘have all the ambitions’ in
the field (see El-Katiri 2010, p. 15). In a similar way Saudi Arabia success-
fully bid to become the headquarter of the new International Renewable
Energy Agency (IRENA), which allows the country to closely follow all
the trends in the field.
Another energy production diversification is to move away from the
export of raw energy materials to oil-and gas-processing on the national
territory and to the export of the production of refineries and gas facto-
ries. This is the strategy which Russia has tried to pursue, at least accord-
ing to its energy strategies. The problem, however, has been in the legal
uncertainty for business in Russia, in the low propensity to long-term
investments and clash of interests of established energy companies,
exporting raw materials and those interested in the export of processed
energy goods. Similar processes can also be identified in other exporting
countries.
Finally, a trend to diversify away from energy goods can be identified. It
manifests itself at the national and companies level. For example, Russian
2009 energy strategy presupposes a drastic reduction of the energy sector
in both economy and revenues of the state budget (Russian Federation
2010). Moreover, various oil and gas exporting states now set up special
funds, which they fill with oil and gas revenues. This approach allows
them to remove superior oil and gas revenues (and therefore fight infla-
tion), cushion external shocks (like the 2008 financial crises) with the help
of this money, set aside, and use them to finance modernization of the
country (for details also see Austvik 2009).
Similarly big oil and gas companies moved to other (energy-intensive)
sectors (like metal or chemical production) to secure the demand and at
the same time gain profit from alternative sources.
4.2 Political Means
Again, as in the situation with political concerns, political means are a

continuation of the economic ones. In most of the cases they perform
an auxiliary function rather than attempt to use energy as a political
weapon. However, we would like to differentiate five types of activities of
producing countries:

1. Producers have attempted to use international legislation to limit the

freedom of consumers to change their internal legislation. Russia has
been particularly skillful in this domain. At one instance it tried to
apply the Energy Charter Treaty (which Moscow did not ratify but
applied provisionally) to challenge the EU’s right to demand owner-
ship unbundling of gas pipelines from production and distribution.
Later Russia presented a Conceptual Approach to regulate inter-
national energy relations (Medvedev 2009) and a draft convention
on the same subject (Shtilkind 2010) to amend current legal norms.
It inter alia attempted to make the demand more transparent and
predictable, to limit unbundling, abolish export duties and limit the
clause on regional integration, which exempted the EU from the
application of universal transit norms. As mentioned, the end result
was the launch of the reform of the Energy Charter Treaty (Energy
Charter Secretariat 2010).
2. Producers have increasingly cooperated with each other. OPEC became
the first – and probably, still the best known – of these clubs.4 More
recently gas exporting countries took this practice on board by
forming the FGEC. Unlike OPEC, FGEC has never had the goal of
price control because of the still regional character of gas markets and
because of broad specter of interests among its limited members (pipe-
line users vs producers of LNG). Rather the driving idea has been to
exchange information on production and transportation, relevant
technologies and practices. However, confidence-building measures
between producers and consumers have moved to the front of the
FGEC agenda.
3. As described in the first part of this chapter, producers have relied
to a great extent on soft measures, like dialogues between pro-
ducers and consumers. There are both global initiatives (like the
IEF) and regional ones (i.e. between the EU and its suppliers like
Norway, Russia and the Gulf Countries). Some, relatively modest,
role was accorded to voluntary efforts to increase the transpar-
ency of the relations (notably, through the IEF JODI system).
Although these instruments have only limited results, the uncer-
tainty in the world energy market encourages their mushrooming.
Russia, for example, in June 2012 announced that it was organizing
a Russian International Energy Forum in 2013, which will bring
together representatives of governments, business community and
experts.
4. Both oil and gas producers have invested a lot in improving their repu-
tation of stable suppliers. The fears that they have to deal with have
varied. For the majority of OPEC countries the concern has been

about their stability and openness to cooperation. Russia has dealt

with the accusation that it uses energy to pursue not so much business
relations but rather its geopolitical ambitions. Producing countries
have used various measures to calm their partners (among them are
speeches of political leaders and business representatives, increased
transparency, hiring western PR agencies to present their strategies).
The best way is of course to improve their legislation and openness to
the world economy but activities in this domain have been patchy and
slow.
5. Russia has entertained the ideas of integration with the European
Union where it would bring its energy complex while the EU will
guarantee consumption. Vladimir Putin made the most famous pres-
entation of this kind in 2010 in Sueddeutsche zeitung (Putin 2010).
The crux of the idea is that integration of economies of Russia and
the EU (its key consumer) will lead to the elimination of threats to
demand security because the very position of Russia will change
(from an external to an internal supplier). The plan also has wider
political and economic implications but it has so far fallen on deaf
ears in the EU.
5 CONCLUSION
Demand security is a more recent concept compared to supply security.

However, since its inception in the 1980s it has developed considerably
in scope, issues and instruments. It does, indeed, represent the other side
of the coin and, together with supply security, it forms global energy
security.
Despite numerous efforts to instill mutually beneficial cooperation
between producers and consumers, however, energy security remains a
combination of liberal efforts to cooperate and realist attempts of both
consumers and producers to decrease dependence on each other. It has not
become an area of constructive, liberal cooperation and it will remain in
the present state for the foreseeable future. In this game producers will be
increasingly more vulnerable. Their strategies to minimize their exposure
will grow in sophistication.
As for many years before, a liberal agenda remains a goal on the
horizon, which moves away every time one tries to approach it. However,
further policy efforts and expert studies are needed to find the way for true
global energy security, which takes into consideration the needs of con-
sumers and producers and makes operational all the pieces of governance
emerging in the area.

NOTES
1. Calculated by the author on the bases of the statistics, provided by the BP (BP 2012).
2. This phrase is one of the most controversial in the document and is frequently cited to prove
political rationale of Russian energy policy, which Moscow has mostly sought to deny.
3. We stop short of using the term ‘liberal’ here because to be recognized as liberal, Russia
has to have the credibility of a liberal actor, which it currently lacks. Therefore, most
Moscow initiatives, which do have a neoliberal institutionalist character, are met with
such disbelief and criticism.
4. In theory the International Gas Union was the first because it was established in 1931.
However, it remained rather loose, and included too many members with diverse inter-
ests. Moreover, its power until very recently was constrained by the nature of the gas
market.
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12. Oil producers’ perspectives on energy
security
Gawdat Bahgat
1 INTRODUCTION
For centuries energy has played a major role in the evolution of human
civilizations. In the last two centuries fossil fuels (coal, oil, and natural gas)
were crucial for the birth and development of the Industrial Revolution
and global economic prosperity. Energy products are certain to maintain
their character as the “engine” for maintaining and improving our way of
life.
A major characteristic of energy is the mismatch between resources and
demand. Generally speaking, major consuming regions and nations (the
United States, Europe, Japan, China, and India) do not hold adequate
indigenous energy resources to meet their large and growing consumption.
On the other hand, major producers (i.e., the Middle East, Russia, the
Caspian Sea, and Africa) consume a small (albeit growing) proportion of
their energy resources. This broad global mismatch between consumption
and production has made energy products the world’s largest traded com-
modities. Almost every country in the world imports or exports a signifi-
cant volume of energy products. This means the wide fluctuation of energy
prices plays a key role in the balance of payments almost everywhere.
The heavy reliance on energy in conjunction with the asymmetric global
distribution of energy deposits have underscored the importance of energy
security. This sense of vulnerability is not new. Despite the abundance of
energy resources and a favorable political and economic environment,
industrialized countries started expressing their concerns over energy
security as early as the first part of the twentieth century. First Lord of
the Admiralty Winston Churchill’s decision that the Royal Navy needed
to convert from coal to oil in order to retain its dominance signaled a
growing intensity of global competition over energy resources (mainly
oil). This rivalry between global powers was played out in World War II
when the Allies enjoyed access to significant oil deposits while Germany’s
and Japan’s strategies to gain access to oil resources failed and led, among
other developments, to their eventual defeat.
The availability of cheap energy resources played a major role in the
258

Oil producers’ perspectives on energy security 259
reconstruction and development of Europe and Japan in the aftermath of

World War II. This prolonged era of relative confidence in the availability
of abundant and secure energy resources came to an abrupt end following
the outbreak of the 1973 Arab-Israeli War. Arab oil producing countries
cut their production and imposed oil embargoes on the United States and
a few other countries to force a change in their political support for Israel.
This use of oil by major producers to gain political leverage shattered
consumers’ sense of energy security. Since then, the fluctuation of energy
prices (partly due to geopolitical developments and partly in response to
supply and demand changes) has reinforced this sense of vulnerability.
In the last few decades there has been a growing understanding of the
challenges that climate changes poses to life on earth. More people have
come to realize that our way of life (i.e., human activities) contributes
to and accelerates global warming and that something needs to be done
to restrain this human-made environmental deterioration. This slowly
growing consensus has added a new dimension to energy security. The
concept is no longer limited to the availability of energy resources at
affordable prices. Environmental considerations restrain the exploration
and development of these resources and urge consideration of less pol-
luting alternative sources of energy. This brief overview of energy history
suggests that there is a wide variety of threats to energy security.
The 1973–1974 oil embargo served as a turning point in global and
domestic energy markets. The availability of energy supplies at afford-
able prices was no longer taken for granted. The turmoil in the world
economy focused on the disruption of supplies to consuming countries.
These oil consumers have implemented several measures (individually
and collectively) to mitigate the impact of such disruptions and to reduce
their energy vulnerability. The measures include the creation of the
International Energy Agency (IEA), the storage of oil supplies in strategic
petroleum reserves, and encouraging energy conservation, among others.
Not enough attention was given to the other side of the energy
equation – producing nations. The concept of “energy security” is
not static. Since the mid-1970s a broader definition has emerged that
addresses all the energy players’ concerns. In the past few decades, while
the industrialized countries have successfully diversified their sources of
crude oil imports and greatly reduced their relative dependence on energy
(albeit at different degrees), the major oil exporters remained dependent
on oil revenues. Petroleum revenues have continued to be the principal
source of income for almost all major oil exporting countries. As a result,
oil exporters have as many reasons to worry about the security of their
markets as importers have to worry about the security of supplies. In
short, the security of demand is considered as important as the security

of supply (Zanoyan 2003). Abdullah Salem El-Badri, Secretary General

of the Organization of Petroleum Exporting Countries (OPEC), summed
up the argument: “Energy security should be reciprocal. It is a two-way
street.” (El-Bardi 2008)
Within this context energy analysts have provided different defini-
tions of energy security highlighting different aspects of the concept.
Barry Barton, Catherine Redgwell, Anita Ronne, and Donald Zillman
define it as a condition in which “a nation and all, or most of its citizens
and businesses have access to sufficient energy resources at reasonable
prices for foreseeable future free from serious risk or major disruption
of service” (Barton et al. 2004, 4). Daniel Yergin underscores a number
of “fundamentals of energy security.” The list includes diversification;
high quality and timely information; collaboration among consumers and
between consumers and producers; investment flows; and research and
development technological advance (Yergin 2007). Yergin argues that
the experience since the early 2000s has highlighted the need to expand
the concept of energy security in two critical dimensions: globalization of
energy markets and the need to protect the entire energy supply chain and
infrastructure (Yergin 2006, 77).
Christian Egenhofer, Kyriakos Gialoglou, and Giacomo Luciani dis-
tinguish between short-term and long-term risks. The former are gener-
ally associated with supply shortages due to accidents, terrorist attacks,
extreme weather conditions or technical failure of the grid. The latter are
associated with the long-term adequacy of supply, the infrastructure for
delivering this supply to markets, and a framework for creating strategic
security against major risks (such as non-delivery for political, economic,
force majeure of other reasons) (Egenhofer et al. 2004).
Finally, a report by the IEA argues that energy security stems from the
welfare impact of either the physical unavailability of energy, or prices
that are not competitive or overly volatile.
Analysts at the Paris-based organization add that the more a country
is exposed to high-concentration markets the lower is its energy security
(International Energy Agency 2007).1
All these definitions underscore the fact that energy security is a multi-
dimensional concept that incorporates cooperation between producers,
consumers, and national and international companies. The experience of
the last few decades indicates that the availability of clean energy resources
at affordable prices cannot be addressed only at a national level. Rather,
international cooperation is a necessity. Thus, energy is part of broader
international relations between states. A major theme of today’s energy
markets is interdependence between consumers and producers. Calls for
self-sufficiency or energy independence are more for domestic constituen-

cies. Indeed, energy interdependence fosters cooperation between coun-

tries in other areas such as economic development and world peace.
Another major theme of the energy security literature is the importance
of diversification of energy mix and energy sources. The less dependent a
country is on one form of energy (i.e., oil, natural gas, coal, nuclear power,
and renewable sources), the more secure it is. Similarly, the more produc-
ing regions there are around the world, the better.
2 ORGANIZATION OF PETROLEUM EXPORTING

COUNTRIES (OPEC)
For a long time, energy policy was perceived as a zero-sum conflict where
the interests of producers and consumers were mutually exclusive. Each
side pursued a strategy to maximize its interests at the expense of the other
side. Stated differently, consuming countries were interested in low oil and
gas prices while producing nations sought to raise prices. The two sides
realized that individual states or companies would have little leverage and
creating a collective entity would make it easier to reach their respective
goals. Against this backdrop, the Organization of Petroleum Exporting
Countries (OPEC) was established in 1960 and the International Energy
Agency (IEA) was founded in 1974. The former represents the producers’
interests and the latter promotes the consumers’ objectives.
The two organizations were created in the midst of price crises. In the
late 1950s and early 1960s, producing nations believed that International
Oil Companies (IOC) were paying them very little for their precious
product. Driven by this perception and the desire to receive a “fair” price
for crude oil and enhance their negotiation leverage, major oil producers
founded OPEC. Following the 1973 Yom Kippur War between Israel and
Arab countries, most OPEC members imposed an oil embargo on the
United States and some other countries to punish them for their support
of Israel. More importantly, they incrementally cut off their production.
These steps led to the so-called first oil price shock in 1973–1974. The
soaring oil prices drove consuming nations, led by the United States to
create the IEA. The goal was to articulate a strategy on how to ensure
consumers’ energy security.
Under these circumstances, it was almost inevitable that the two organi-
zations adopted conflicting strategies. Their opposing policies failed to
assure global energy markets and, indeed, contributed to the wide fluc-
tuation of oil prices and the overall instability of international economy.
Little wonder that a growing consensus emerged calling for coopera-
tion between producers, consumers, and other major energy players

(i.e., IOCs). Increasingly, more producers and consumers have ceased to

perceive their respective interests as mutually exclusive and have identified
growing areas of common interest. In order to promote and consolidate
cooperation, several dialogues, partnerships, and organizations were
created. The International Energy Forum (IEF) is a prominent example
of these efforts.
The roots of the IEF go back to the mid-1970s when the producers and
consumers held a meeting in Paris to discuss the rise in oil prices. Positions
were polarized and consequently no concrete results came out of this
meeting. However, in the ensuing years it became clear that sharply fluc-
tuating oil prices were detrimental to both producers and consumers and
there could be no long-term winners in a volatile environment. A growing
realization by both sides was that stable prices at a reasonable level would
serve their common interests. This realization of mutual interest, coupled
with the geopolitical turmoil of the 1990–91 Gulf War, furnished the
ground for renewed efforts to establish a producers-consumers dialogue.
The Iraqi invasion and occupation of Kuwait (both are OPEC members)
highlighted the threat to global oil markets and the broader world’s eco-
nomic prosperity. A more cooperative framework between producers
and consumers was born out of this conflict.
At the initiative of Presidents Francois Mitterrand of France and
Carolos Perez of Venezuela, a Ministerial Seminar of producers and
consumers was held in Paris in 1991. This initiative helped to clarify the
atmosphere of mistrust that characterized the relations between producers
and consumers and underscored the areas of mutual interest and potential
for cooperation to address common challenges. A follow-up meeting was
held in Norway in 1992. Since then, the IEF has held meetings alternately
in an exporting and an importing country.
The IEF is unique not only in its global perspective and scope, but also
in its approach. It is not a decision-making organization or a forum for the
negotiation of legally binding settlements and collective action. Nor is it a
body for multilateral fixing of prices and production levels. The informal-
ity of this framework has encouraged a degree of frank exchanges, which
cannot be replicated in traditional and more formal international settings.
For most of the twentieth century the global oil markets were domi-
nated by a few major international oil companies (IOCs), the so-called
Seven Sisters: Standard Oil Co. of New Jersey (later Exxon), Standard
Oil Co. of New York (originally Socony, later Mobil), Standard Oil Co.
of California (Socal, later Chevron), Royal Dutch Shell, Texaco, BP, and
Gulf (Bahgat 2003, 178). The OPEC oil producing countries did not par-
ticipate in production or pricing of crude oil, but simply received a stream
of income through royalties and income taxes as part of the concession

system. OPEC countries were too weak to challenge the multinational

Seven Sisters’ domination of the industry.
The first move towards the establishment of OPEC took place in 1949,
when Venezuela approached Iran, Iraq, Kuwait, and Saudi Arabia and
suggested that they exchange views and explore avenues for regular and
closer communication between them. The need for closer cooperation
became more apparent when, in 1959, the major international oil compa-
nies unilaterally reduced the price of oil. This prompted the convening of
the First Arab Petroleum Congress, held in Cairo. The Congress adopted
a resolution calling on oil companies to consult with the governments
of the producing countries before unilaterally taking any decision on
oil prices. It also set up a general agreement on the establishment of an
oil consultation commission (OPEC 2010).
In 1960 the IOCs reconfirmed their domination by further reducing oil
prices. In response, delegates from five major oil producing nations – Iran,
Iraq, Kuwait, Saudi Arabia, and Venezuela – met in Baghdad and
announced on September 16, 1960 the foundation of OPEC. The goal
was, and still is, to protect the interests of these major producing nations.
Accordingly, in their first resolution the five OPEC members empha-
sized that the companies should maintain price stability and that prices
should not be subjected to fluctuation. They called for companies not to
undertake any change in the posted price without consultation with the
host country. They pledged to establish a price system that would secure
stability in the market by using various means, including the regulation of
production, with a view to protecting the interests of both consumers and
producers.
These ambitious goals, however, proved hard to achieve given the little
leverage that producing nations had and the dominant role of the IOCs.
By the early 1970s, some major dynamics of the global oil industry funda-
mentally changed. First, some IOCs, such as ENI of Italy and Occidental
of the United States, started operations in the Middle East and elsewhere
and offered more attractive financial terms than those offered by the other
major IOCs. This gradual process eroded the near monopoly imposed by
the multinational companies. Second, economic prosperity in the United
States, Western Europe, and Japan accelerated and was fueled by growing
demand for oil. These major consumers, however, lacked sufficient indig-
enous supplies. Thus, the growing appetite for oil was met, mainly, by
production from OPEC countries. Stated differently, the world grew more
dependent on OPEC supplies. The combination of these two develop-
ments left OPEC producers in a stronger bargaining position than in the
early 1960s.
Building on this newly acquired bargaining power, OPEC producers

sought to increase oil prices. Their demands were rejected by the multi-
national oil companies and negotiations between the two sides collapsed.
The 1973 Arab-Israeli War provided the geopolitical and geo-economic
opportunity to fundamentally alter the balance of power between OPEC
members and IOCs. In addition to imposing an oil embargo on the United
States and a few other countries, and incrementally cutting production,
some OPEC governments stopped granting new concessions and started
to claim equity participation in the existing concessions, with a few of them
opting for full nationalization. Asserting their power, OPEC members
decided in October 1973 to unilaterally raise oil prices independently of
the multinational oil companies’ participation. These developments paved
the way for structural changes in the world oil industry.
In the aftermath of the first oil shock, OPEC members consolidated
their control over production and prices. However, their lack of the nec-
essary technological and financial infrastructures left them dependent
on multinational oil companies. Thus, rhetoric aside, OPEC members
continued to sell large proportions of their production to the old conces-
sionaires. Political developments in the Persian Gulf including the 1979
Iranian Revolution followed by the eight-year war between Iran and Iraq
had a significant impact on OPEC and the broad global oil industry. The
interruption of oil supplies from Iran and Iraq triggered widespread chaos
leading to soaring oil prices in what became known as the second oil price
shock.
The continuing push for higher prices underscored a division within
OPEC between two competing strategies. The first strategy was advocated
by OPEC members with considerable proven reserves, small populations,
and high per capita incomes (i.e., Kuwait, Qatar, Saudi Arabia, and the
UAE). These countries sought to moderate prices in order to maintain
demand over the long run. The other strategy was pursued by members
with larger populations, lower oil exports per capita income (i.e., Algeria,
Indonesia, Iran, and Nigeria). This second group demanded restraint on
OPEC production and higher prices (Blaydes 2004).
This disagreement between the so-called hawks and doves laid the
ground for an awkward situation whereby a two-tiered pricing system pre-
vailed. Saudi leaders perceived high oil prices as harming oil producers in
the long run by encouraging investment in high-cost areas outside OPEC
and switching to alternative fuels. Accordingly, Riyadh refused to raise
prices beyond a certain level.
Against this backdrop, OPEC adopted a quota system in March 1983
which set a production ceiling. By controlling the volume of global pro-
duction, OPEC sought to influence prices. Within this framework OPEC
adjusted its production upward and downward based on the level of

roduction from non-OPEC countries. Saudi Arabia, the major oil pro-
p
ducer and exporter, played the role of “swing producer” within OPEC.
Political turmoil and the lack of consensus among OPEC members for
a unified strategy prompted IOCs to increase their investments in areas
outside OPEC, most notably the North Sea and the Gulf of Mexico. The
increasing supplies from outside OPEC coupled with the fall in demand as
a result of high prices led to a drastic fall of OPEC’s share of the global oil
market. This intensive rivalry between OPEC and non-OPEC producers
and within OPEC proved unsustainable. In the mid-1980s, Saudi Arabia
decided to drop its system of selling oil at fixed prices and instead adopted
a market-oriented pricing system. Consequently, Saudi Arabia’s produc-
tion started to rise quickly and by 1986 global markets became saturated.
This led to a severe collapse in oil prices.
The very low prices in the mid-1980s hurt the interests not only of
OPEC producers, but also those of other producers such as the North
Sea, the United States, and the Soviet Union as well as the overall global
economy. This broad chaos and the emergence of many suppliers and
many consumers led to the development of “a complex structure of oil
markets which consist of spot, physical forward, futures, options, and
other derivative markets.” This structure is based on formula pricing
where the price of a certain variety of crude oil is set as a differential to
a certain benchmark or reference price. These include Brent Blend, West
Texas Intermediate (WTI), Dubai, and Nigerian Forcados, among others.
One of the major characteristics of the oil market in the later part of the
1980s and most of the 1990s was the stability of the long-term oil price at
a relatively low level.
From 2000 to 2008, oil prices soared and, as a result, most oil exporting
countries in OPEC and non-OPEC members accumulated substantial rev-
enues. The imbalance between supply and demand was the driving force
behind the soaring oil prices. Unlike the supply-interruption oil shocks
of 1973–1974 and 1979–1980, the 2000s’ surge was a demand-driven one,
fueled by strong Asian consumption. Furthermore, the surge reflected
not only increasing demand and decreasing supply, but also broader
macroeconomic and geopolitical changes such as rising exploration and
production costs, the falling value of the US dollar, the re-emergence of
“resources nationalism,” inadequate refining capacity, and an aging labor
force (Bahgat 2008). The combination of these factors had shaped the
global oil market as well as regional and national ones, albeit to different
degrees
After reaching a peak of $147 per barrel in 2008, prices dropped signifi-
cantly and then started a slow process of recovery. OPEC members and
non-OPEC producers reacted in different ways to the rise in oil prices.

There was a common assumption that in the face of high and rising oil
prices, OPEC would respond by increasing supply to moderate prices and
stabilize the market. Such an action would help maintain healthy growth
in global oil demand and limit the entry of substitutes such as tar sands
and ethanol. This view was influenced by OPEC’s decision to introduce a
price band in 2000, which involved production adjustments when the price
moved about $28 for 20 consecutive trading days or when the price moved
below $22 for 10 consecutive trading days.
OPEC members failed to put a ceiling on the price and, indeed, most
members took advantage of rising prices by increasing their produc-
tion and exporting as much as they could to maximize their profit. This
attitude suggests that OPEC’s role is not to prevent oil prices from rising
above certain levels or to set a price ceiling. Rather, a key objective of
the organization is to avoid oil prices from falling below a level deemed
unacceptable by its members.
On the other hand, non-OPEC producers’ response to the 2000 price
boom was weak. They were not able to raise their production to take
advantage of rising prices. This suggests that non-OPEC production has
peaked or is close to reaching this stage. It is increasingly becoming more
costly and technologically and environmentally challenging to maintain
or increase production from non-OPEC producers. As one analyst argues,
there seems to be an asymmetric response to oil prices: “A sharp rise in oil
price induces a modest investment response in non-OPEC countries, while
a decline in the oil price generates a sharp fall in investment and a period of
underinvestment in the oil sector” (Fattouh 2010, 21). This argument is in
line with the IEA’s projection, which predicts that as conventional oil pro-
duction in countries not belonging to OPEC peaks, “most of the increase
in output would need to come from OPEC countries, which hold the
bulk of remaining recoverable conventional oil resources” (International
Energy Agency 2009, 42).
Three conclusions can be drawn from this brief review of the fluctua-
tion of oil prices in the last few decades and the role OPEC played in this
process. First, as with any commodity, the role of oil prices is to signal
relative scarcity or abundance which in turn causes all energy players (i.e.,
consumers, producers, national oil companies, and IOCs among others)
to adjust to the allocation of resources (Mabro 2006). Second, rhetoric
aside, OPEC does not fix oil prices and does not have a direct impact on
their rise and fall. Rather, given the OPEC members’ substantial proven
reserves and large volumes of production and exports, the organization
plays a significant indirect role in influencing price formation (Mabro
2005). OPEC signals its preferred price and alters its production volume
up or down. These signals are perceived by other energy players and, in

turn, they respond to these signals. Within this context, it is important to

point out that despite impressive improvements, the availability of accu-
rate data on production, consumption, reserves, and other vital informa-
tion is not perfect. As a result, “market psychology” plays an important
role in shaping the movement of oil prices. Third, historically, exporters
and importers have had divergent interests, with the former favoring
higher prices and the latter favoring lower ones. These perceived opposite
interests have recently changed in favor of an emerging realization that
too high or too low prices do not serve anyone’s interests. Too high prices
encourage conservation and alternative energy, and destabilize the overall
global economy. Too low prices reduce investment in new exploration and
the development of oil deposits and contribute to economic and political
turmoil in producing countries.
3 OPEC’s OBJECTIVES AND PERSPECTIVES ON

ENERGY SECURITY
Article 2 of OPEC’s statute clearly spells out the main objectives of the
organization. These include coordinating the members’ petroleum policies
and safeguarding their interests, individually and collectively. Another
related goal is to stabilize prices and eliminate fluctuations. Most impor-
tantly, OPEC seeks to secure a steady income for its members, sufficient
and reliable supplies to consuming countries, and fair return on investment
by either national oil companies or international ones.
The statute aside, OPEC member countries’ heads of state and gov-
ernment occasionally meet to deliberate and articulate broad strategic
guidelines. Since its foundation in September 1960, OPEC has held three
summits: Algiers, 1975; Caracas, 2000, and Riyadh, 2007. For each of
these summits, the main purpose was to step back from the day-to-day
activities of the international oil market and examine issues at the national
leadership level, pertaining to the fundamental principles, objectives,
and procedures of OPEC. The summits also examined contemporary
issues confronting the world, particularly the global economy and divi-
sions between rich and poor countries and how OPEC, individually and
collectively, can help bridge this gap.
The first summit was held in 1975 in the aftermath of the first oil shock
and in the midst of intense confrontation between producing and consum-
ing countries. Not surprisingly, the summit’s deliberations and resolutions
reflected this international confrontation. OPEC leaders rejected allega-
tions attributing to the price of petroleum the responsibility for the insta-
bility in the world economy. They claimed that adjustment in the price of

oil did not contribute to the high rates of inflation within the economies
of developed countries. OPEC leaders reminded the rest of the world
that they have contributed through multilateral and bilateral channels to
the development efforts and balance of payments adjustments of other
developing countries, as well as industrialized nations. They reaffirmed
solidarity with other developing countries in their struggle to overcome
underdevelopment.
Furthermore, OPEC leaders asserted that the conservation of petro-
leum resources is a fundamental requirement for the well-being of future
generations and urged the adoption of policies aimed at optimizing the
use of this essential and non-renewable resource. On the other hand,
OPEC leaders reaffirmed their readiness to ensure that supplies will meet
the essential requirements of the developed countries, provided that the
consuming countries do not use artificial barriers to distort the normal
operation of the laws of supply and demand.
By the time the second summit was held in Caracas in September 2000,
the international economic system and the global energy markets had
experienced some fundamental changes; in particular, environmental
issues had attracted significant attention and OPEC’s share in global
supply was falling in favor of supplies by other producers, such as Russia
and the Caspian Sea. Finally, oil prices were stable at a relatively low
level for most of the 1990s. The Caracas Summit reflected OPEC leaders’
concerns over these issues, among others.
OPEC heads of state and government confirmed their commitment to
provide adequate, timely, and secure supplies of oil to consumers at fair
and stable prices and emphasized the strong link between the security of
supply and the security and transparency of demand. They called for a fair
share for OPEC in the world oil supply and for growing cooperation on
a regular basis between OPEC and other oil exporting countries. On the
other hand, they demanded the opening of effective channels of dialogue
between oil producers and consumers. OPEC leaders also asserted their
association with the universal concern for the well-being of the global
environment, and their readiness to continue to participate effectively
in the global environmental debate and negotiations, including the UN
Framework Convention on Climate Change and the Kyoto Protocol, to
ensure a balanced and comprehensive outcome.
OPEC leaders called on consuming nations to adopt fair and equitable
treatment of oil by ensuring that their environmental, fiscal, energy, and
trade policies do not discriminate against oil. They also expressed their
concern that taxation on petroleum products forms the largest component
of the final price to the consumers in the major consuming countries, and
called upon them to reconsider their policies with the aim of alleviating

this tax burden for the benefit of the consumers, for just and equitable
terms of trade between developing and developed countries, and for the
sustainable growth of the world economy.
The third summit, held in Riyadh in November 2007, came amid rising
global concern over climate change and deep global dependence on fossil
fuels driven by soaring oil prices in the previous seven years. OPEC leaders
sought to address these concerns. Thus, the summit focused on three
major themes: the stability of global energy markets; energy for sustain-
able development; and energy and the environment.
OPEC leaders pledged to efficiently manage and prolong the exploi-
tation of their exhaustible petroleum resources in order to promote the
sustainable development and the welfare of future generations. They
re-emphasized the connection between demand security and supply secu-
rity and recognized that with globalization the economies of the world
and energy markets are integrated and interdependent. They urged all
parties to find ways and means to enhance the efficiency of financial
petroleum markets with the aim of reducing short- and long-term price
volatility. They reiterated the need to continue the process of coordina-
tion and consultation with other petroleum exporting countries and the
necessity to strengthen and broaden the dialogue between energy produc-
ers and consumers. They repeated their call on consuming governments
to adopt transparent, non-discriminatory, and predictable trade, fiscal,
environmental, and energy policies and promote free access to markets
and financial resources.
OPEC leaders associated their countries with all global efforts aimed
at bridging the development gap and making energy accessible to the
world’s poor while protecting the environment. They stated that eradicat-
ing poverty should be the first and overriding global priority guiding local,
regional, and international efforts.
As major oil producers and exporters are heavily dependent on oil
revenues, OPEC members have adopted a cautious stance on the climate
change controversy. They reiterated that the process of production and
consumption of energy resources poses different local, regional, and
global environmental challenges. Meanwhile, they stressed that human
ingenuity and technological development have long played pivotal roles in
addressing such challenges and providing the world with clean, affordable,
and competitive petroleum resources for global prosperity. OPEC leaders
underscored that they share the international community’s concern that
climate change is a long-term challenge, and recognize the interconnection
between addressing such concerns on the one hand, and ensuring secure
and stable petroleum supplies to support global economic growth and
development on the other hand. Finally, they stressed the importance of

cleaner and more efficient petroleum technologies and demanded that all
policies and measures developed to address climate change concerns be
both balanced and comprehensive.
4 OPEC: LONG-TERM STRATEGY

The main guiding texts for OPEC are the OPEC statute, approved in
January 1961; the Summit Declarations of 1975, 2000, and 2007; and the
Long-Term Strategy, adopted on the organization’s 45th anniversary
in September 2005. This strategy, prepared over a period of two and a
half years, provides a broad vision and framework for the organization’s
future.
The strategy identifies the uncertainties surrounding future demand
for OPEC oil as a key challenge. Factors such as future world economic
growth, consuming countries’ policies, technology development, and
future non-OPEC production levels contribute to these uncertainties
regarding demand for OPEC oil. The strategy explores these uncertain-
ties in three scenarios that depict contrasting futures of the global energy
scene. These scenarios are dynamics-as-usual, protracted market tight-
ness, and a prolonged soft market.
There are substantial uncertainties over future economic growth arising
from the complex interplay of domestic and global determinants of that
growth, including such diverse factors as demographics, advances in
technology, capital availability, and trends in commodity prices, domestic
policies, and global trade developments, regimes, environmental policies,
and financial regulations. Another area of uncertainty stems from con-
suming countries’ policies. OPEC claims that taxation of energy products
is often seen not only as a means of raising revenue, but also as a means
of controlling demand in addressing environmental and energy security
issues. The strategy alleges that consuming countries’ policies demonstrate
significant discrimination against oil, involving not only higher tax rates,
but also subsidies for competing fuels.
A third area of uncertainty with significant impact on oil demand is
technological development. For example, in the transportation sector,
conventional internal combustion engines could continue to achieve sig-
nificant fuel economy improvements, while hybrid vehicles may witness
an important growth. The introduction of non-oil-fueled vehicles and the
use of alternative fuels, such as bio-fuels, are drivers that could affect oil
demand growth patterns in the transportation sector. A fourth area of
concern is the development in non-OPEC supply. A number of factors,
such as oil prices, upstream legal and fiscal regimes, and investment in

non-OPEC countries, technological advances, and exploration successes,

will shape future scenarios regarding non-OPEC supply.
A fifth area of uncertainty is related to environmental concerns. The
profile of incremental global demand is overwhelmingly for light and
clean products, while incremental supply comprises significant volumes
of sour, medium, and heavy crude grades. The combination of this with
the move to ever-stricter product quality and environmental regulations
represents a challenge for the downstream industry. Future refining capa-
bility needs to be considered in terms of both the adequacy of secondary
processes – for example, to upgrade heavy streams and to meet tight
targets for sulfur – and crude distillation capacity.
The combination of these uncertainties signifies a heavy burden of risk
in making the appropriate investment decisions. Accordingly, the strategy
calls for several measures to meet these concerns. First, the promotion
of the development of technologies that address climate change concerns
such as carbon dioxide capture and storage technology. Second, OPEC
members should continue to play an active role in the climate change
negotiations. OPEC supports the principle of common, but differenti-
ated, responsibilities. It believes that the international community should
fulfill its obligations to strive to minimize the adverse effects of policies
and measures on developing countries, in particular fossil-fuel exporting
developing countries (i.e., OPEC members). This could involve assistance
in relation to economic diversification and transfer of technology. Third,
dialogue among producers and between producers and consumers should
be widened and deepened to cover all issues of mutual concern. These
include security of demand and supply, market stability, upstream and
downstream investment, and technology. Finally, the strategy emphasizes
OPEC’s commitment to support oil market stability. It recognizes that
extreme price levels, either too high or too low, are damaging for both
producers and consumers, and points to the necessity of being proactive
under all market conditions.
To conclude, when OPEC was founded in 1960 the oil industry and the
global economy were very different from what they are more than five
decades later. During this time the oil industry has experienced several
upheavals, OPEC policy contributing to some of them. Over the years
many observers have predicted OPEC’s demise. However, it has survived
and become an important driving force in the global energy markets.
Its members’ interests are not identical, though they have managed to
coordinate their policies and find common ground most of the time. Any
assessment of OPEC’s role in managing global oil prices would be highly
controversial. The push for higher prices, which characterized the first
decades of OPEC’s life, has waned in favor of an emerging consensus that

stable prices at a “reasonable” level would serve both the producers’ and
consumers’ interests.
NOTE
1. The International Energy Agency, “Energy security and climate policy,” p. 422, available
at http://www.iea.org (accessed May 9, 2007).
REFERENCES
Bahgat, G. (2003) American Oil Diplomacy in the Persian Gulf and the Caspian Sea,
Gainesville, Florida: University Press of Florida.
Bahgat, G. (2008) “Supplier-user teamwork key to stable oil prices,” Oil and Gas Journal,
106 (32), 20–24.
Barton, B., Catherine Redgwell, Anita Ronne and Donald N. Zillman (eds) (2004) Energy
Security: Managing Risk in a Dynamic Legal and Regulatory Environment, Oxford: Oxford
University Press.
Blaydes, L. (2004) “Rewarding impatience: A bargaining and enforcement model of OPEC,”
International Organization, 58 (2), 213–237.
Egenhofer, C., K. Gialoglou and G. Luciani (2004) “Market-based options for security
of energy supply,” Center for European Policy Studies, available at http://www.ceps.be
(accessed March 21, 2004).
El-Bardi, A.S. (2008) “Energy security and supply,” available at http://www.opec.org
(accessed February 14, 2008).
Fattouh, B. (2010) Oil Market Dynamics Through the Lens of the 2002–2009 Price Cycle
Oxford: Oxford Institute for Energy Studies.
International Energy Agency (2007) “Energy security and climate policy,” available at http://
www.iea.org (accessed May 9, 2007).
International Energy Agency (2009) World Energy Outlook, Paris: International Energy
Agency.
Mabro, R. (2005) “The international oil price regime: origins, rationale and assessment,”
Journal of Energy Literature, 11 (1), 3–20.
Mabro, R. (2006) “Introduction,” in R. Mabro (ed.), Oil and the Twenty-First Century:
Issues, Challenges and Opportunities, Oxford: Oxford University Press, 1–18.
OPEC (2010) “General Information,” available at http://www.opec.org (accessed 8 January
2010).
Yergin, D. (2006) “Ensuring energy security,” Foreign Affairs, 85 (2), 69–82.
Yergin, D. (2007) “The fundamentals of energy security, testimony before the US House
of Representatives Committee on Foreign Affairs,” available at http://www.cera.com
(accessed March 23, 2007).
Zanoyan, V. (2003) “Global energy security,” Middle East Economic Survey, 41 (15), 20–22,
available at http://www.mees.com (accessed April 14, 2003).

13. Energy security governance in light of the
Energy Charter process
Andrei V. Belyi
1 INTRODUCTION
Policy and academic discussions about energy security open an impor-

tant debate about possibilities and limits of energy security governance
(Goldthau, 2012; Kuzemko et al, 2012). Therefore, this chapter aims to
assess opportunities for energy security governance in the context of the
Energy Charter Treaty (ECT), and subsequent and alternative documents.
Since the oil shocks of 1973, energy relations between states have been
primarily viewed from a security perspective, which considers states to be
in a permanent struggle for access to resources and infrastructures (Waltz,
1979, 177–179). According to this state-centred view, energy security is
a factor in the unpredictability of international relations, especially for
countries dependant on external energy supplies. Recently, much analy-
sis has concentrated on EU-Russia energy relations, where the security
dimension has a particular flavour (Kuzemko et al, 2012; Belyi, 2012).
More particularly, the issue of the ECT has been discussed in light of
EU-Russia energy security relations (Yafimava, 2011). The development
of an international legal framework would aim to reduce the level of geo-
political clashes between energy producing, consuming and transit coun-
tries. Nevertheless, the emergence of the Energy Charter did not greatly
diminish traditional antagonistic energy security relations, although an
international framework was developed.
Significantly, a geopolitical, state-centred approach to energy security
cannot ignore attempts at international energy governance, even where an
international legal approach does not eliminate antagonisms in interstate
energy relations. This conceptual duality leads us once again to a debate
between state-centred and law-centred approaches in international rela-
tions (Keohane, 2001; Waelde, 2008). Energy relations have engendered
an evolution of international legal norms, including investment law,
best-practice transfer in energy policies, and even a multilateral Energy
Charter Treaty (ECT). Hence, an understanding of energy security based
on state-centred self-sufficiency co-exists with significant attempts to
create international patterns of energy governance (Waelde, 2008; Belyi,
273

2009). Analyzing security in light of both law-centred and state-centred

conceptions reflects various analytical perspectives on international polit-
ical economy (Gilpin, 1987). In both cases, multilateralism would imply
a view of collective action, as being either successful or limited. The
significance of the ECT has re-emerged with the European Parliament’s
Communication on External Energy Policy (European Parliament, 2012),
in which it appeals for expansion of the Energy Charter beyond its current
members. Likewise, recent Russian proposals either to revise or repeal
the ECT emphasizes the need to analyse the issues in greater depth. In
doing so, a number of questions emerge about the relevance of a multi-
lateral energy security framework and about its possible limits. The view
defended in this chapter points to important steps towards international
energy security governance within the ECT, whereas its limits stem from
discrepancies in understandings of energy security needs, for example
energy security of supply and security of demand invoke different pri-
orities and objectives (Seliverstov, 2009). The dichotomy reflects regional
and country level perspectives on the wider, global challenges of energy
security. New trends imply the growing significance of regional economic
blocs, protectionism and resource nationalism. Thus, the dynamics of
global energy governance reflect a development of regionalisms and
nationalisms. More particularly, security understandings and views on
energy governance differ between the European Union (EU) and Russia,
and therefore these two major actors clashed over Energy Charter per-
spectives.1 In order to outline the differences, this chapter will analyse
the ECT governance framework in the transit and investment fields, then
outline discrepancies between the EU and Russia on the multilateral
commitments, and finally outline their recent positions on international
energy governance.
2 ENERGY CHARTER TREATY AS GROUNDS FOR

ENERGY GOVERNANCE
Multilateralism involves an acceptance of norms based on a belief of

common action. In this respect, the Energy Charter represents a unique
attempt of a regime formation specifically in energy. However, as this
regime operates in a highly politicized area, a number of conflicts about
an acceptance of the regime emerged. Therefore, an analysis of the Energy
Charter should include both aspects: particularities of the regime forma-
tion on one hand, and the impact on energy governance on the other.
Therefore, a brief historical assessment of the international energy security
governance implies an understanding of the context in which the Energy

Energy security governance 275
Charter emerged. Before outlining differences in energy security govern-

ance understandings between the EU and Russia, it would be useful to
understand both the political context of the Treaty and its legal implica-
tions of the text adopted in 1994.
2.1 European Energy Charter
The Energy Charter process started with the European Energy Charter
initiated by the Dutch Presidency of the European Community in 1990.
In December 1991, the European Charter Declaration was signed with
a view to bringing about a new East-West economic relationship. The
institutional logic at that time was marked by the 1990 Charter of Paris
signed by the two former ideological blocks, and which had often been
seen as a starting point for the “New Europe”. The Charter of Paris
was then the basis for a “steadfast commitment to democracy based on
human rights and fundamental freedoms; prosperity through economic
liberty and social justice”.2 Europe’s new image is related to the “security
community”, where multilateralism and “seminar diplomacy” aim to inte-
grate “academic and diplomatic discourse in practice”.3
The European Energy Charter has been part of the “seminar diplomacy”
semantics, which involves a number of foras and declarations since the
beginning of 1990s. The spirit of the European Energy Charter declara-
tion of 1991 is clearly influenced by the Charter of Paris semantics. The
Concluding Document of the European Energy Charter (December 1991)
stipulates:
The representatives of the signatories meeting in The Hague on 16 and 17

December 1991, Having regard to the Charter of Paris for a New Europe,
signed in Paris on 21 November 1990 at the summit meeting of the Conference
on Security and Cooperation in Europe (CSCE); Having regard to the
document adopted in Bonn on 11 April 1990 by the CSCE Conference on
Economic Co-operation in Europe; Having regard to the declaration of the
London Economic Summit adopted on 17 July 1991; having regard to the
report on the conclusions and recommendations of the CSCE meeting in Sofia
on 3 November 1989, on the protection of the environment, as well as its
follow-up; Having regard to the Agreement establishing the European Bank
for Reconstruction and Development signed in Paris on 29 May 1990; Anxious
to give formal expression to this new desire for a European-wide and global
co-operation based on mutual respect and confidence.
Unlike other “seminar diplomacy” foras, the European Energy Charter

declared an objective to create a legally-binding regime. The European
Energy Charter declares: “The signatories of the European Energy
Charter undertook to pursue the objectives and principles of the Charter

and implement and broaden their co-operation as soon as possible by

negotiating in good faith a Basic Agreement and Protocols”.
Furthermore, negotiations of the “Basic Agreement” started in order to
promote “East-West industrial co-operation by providing legal safeguards
in areas such as investment, transit and trade”. Creating energy govern-
ance is beyond a simple “seminar diplomacy” declaration. It involves a
creation of an effective regime in a highly strategic area, which can not be
done without controversies.
2.2 Negotiations of the Treaty
In July 1991, the European Union initiated negotiations over the “Basic
Agreement”. Other signatories of the Energy Charter joint the efforts
of negotiations. At an early stage of negotiations, controversies around
the “Basic Agreement” emerged between the “Western” participants of
the process. Main opposition lines emerged between the US and the EU. The
US considered that the ECT should be largely incorporated into the General
Agreement on Tariffs and Trade regime. By contrast, the EU adopted a flex-
ible position, which was favourable to the participation of the non-GATT
members of Eastern Europe and former Soviet Union (hereinafter FSU). A
problematic point between the two actors also involved the scope of national
regime, because for the US resource ownership is a competence of the states
rather than of a federal state. Hence, the national regime should have been,
according to Washington, allocated to the federal subjects of the country.
In addition, the US brought to the table the idea of a non-discrimination
of investments at the pre-investment phase, which would aim to ease access
to the investments. Hence, the US insisted on enlarging the scope of invest-
ment protection to the pre-investment phase, whereas the EU insisted
on the protection of the existing investments. Nevertheless, contracting
parties decided to follow with a supplementary treaty on investment pro-
tection, which would also involve access to resources and markets. The US
in turn withdrew from the treaty negotiations and remained an observer
(Dore, 1996). Consequently, discrepancies over international energy gov-
ernance are strongly reflected in transatlantic relations. In turn, absence of
the US in the framework hinders the political scope of the ECT.
In the meantime, “the East”, namely Russia and other FSU coun-
tries, remained passive despite their importance in oil and gas resources.
Economic depression, coupled with political instability in 1992–1993,
did not allow Russia to be an active player in the negotiation process.
Therefore, in the later stages, Russia considered it could legitimately
review several points, which played a vital role for its energy exports.
However, during the first round of the negotiations, Russia allowed the

EU to lead the process. An institutional reflection of the EU’s dominance

is the location of the Energy Charter Secretariat in Brussels. In addition,
the EU influenced the spirit of the treaty text (Blamberger and Waelde,
2007). Furthermore the early EU initiatives influenced the Russian per-
ception of the Treaty as a pro-EU instrument in the FSU area.
In December 1994 the treaty was signed by 49 countries represent-
ing major energy producers on the Eurasian continent (Azerbaijan,
Kazakhstan, Norway and Russia), the EC as well as EU Member States,
Japan and Australia. During the second phase, three more countries
joined the ECT. Many producing countries, including Saudi Arabia,
Iran and Venezuela, obtained observer status without signing the Treaty.
New energy consuming countries in Asia, mainly China and Pakistan,
became observers as well. However, the first phase of the Charter process
was characterized by a EU-Russia focus. Therefore there is a confusion
because the EC is seen as an EU Russia relations instrument.
However, objectives of the treaty cover a broader scope. Article 2
declares “this Treaty establishes a legal framework in order to promote
long-term cooperation in the energy field, based on complementarities and
mutual benefits, in accordance with the objectives and principles of the
Charter.” The treaty enters into a logic of promoting open international
energy markets, as Article 3 stipulates: “The Contracting Parties shall
work to promote access to international markets on commercial terms,
and generally to develop an open and competitive market, for Energy
Materials and Products.”
The outcome of negotiations led to eight draft parts of the text, which
represent the overall complexity of the newly emerged regime. The
ECT issue-specific regime can be further divided into two major com-
ponents: trade (which includes transit) and investment regimes. Both
components represent a particular importance in the development of
international energy governance and therefore necessitate a particular
attention. Particular attention should also be paid to a very embryonic
environmental regime, which has been also stipulated by the ECT. Finally,
a state-to-state dispute settlement mechanism represents the core element
for legal effectiveness of the ECT regime.
A definition of governance is coupled with the existence of peaceful
methods of conflict-resolution, including the dispute settlement mecha-
nisms. The general principle of dispute settlement is based on the UN
Charter, which in its Article 1 aims to “bring about by peaceful means, and
in conformity with the principles of justice and international law, adjust-
ment or settlement of international disputes or situations which might lead
to a breach of peace”. In this respect, the ECT institutionalizes existing
methods of conciliation and arbitration mechanisms (Waelde, 1996).

As mentioned above, specific dispute settlement mechanisms are fore-

seen within each of the main components of the regime, namely Article 29
for trade and Article 7(7) for transit. Arbitration norms under the ECT
are stipulated in Article 26 for investor-to-State disputes and Articles 27
and 28 for state-to-state disputes (Happ, 2002). Our particular focus of
ECT governance is the trade and transit as well as investment governance.
The issue of energy efficiency promotion does have a declaratory essence,
albeit representing an important normative dimension.
2.3 Energy Charter’s Trade and Transit Governance
The ECT represents the first international regime in energy trade and
transit. Specificities of energy trade and transit were not considered earlier
in the GATT-based global trade governance. The reason for this lies in the
embryonic status of the oil and gas cross-border trade in the late 1940s. By
the beginning of the 1990s, issues of access to energy markets and infrastruc-
tures emerged in world economic relations. Increasingly, complex trade and
investment structures led to a need for the creation of mechanisms for the
settling of international disputes. On these grounds, we observed that the
ECT responded to a changing structure in international energy markets. At
the same time, the Energy Charter’s trade and transit provisions are largely
borrowed from GATT wording (Salem Haighighi, 2006, 162).
Unlike many other products, transport and storage of gas are capital
intensive and need to flow in one direction only. Therefore, an access to
cross-border capacities can become a strategic issue in both political and
economic terms. Our particular interest consists in analysing the path
towards a transit regime, which has been particularly hindered by the high
level securitization of intra-FSU gas trade relations.
In the aftermath of the break-down of the USSR, East-West oil and gas
trade became a cross-border issue, where transit of energy occurs. With
the disintegration of the Soviet state, the Soviet Unified Gas System was
substituted by a number of companies owned by the newly emerged states.
Each of them owned pipelines, underground storages and gas equipments
(Mitrova, 2009). In the aftermath of the breakdown of the USSR, Russia
inherited most of the pipeline network, which also connects Central
Asian gas production to the extra-FSU exports. Ukraine possesses the
largest transit pipeline network with Europe-widest gas storages, which is
nowadays an important factor for the security of gas supply. The Energy
Charter negotiators took into consideration the new economic environ-
ment and therefore the transit of energy was integrated into the treaty. A
transit regime should address a new context of energy trade. That is why
Article 7(1) of the ECT iterates a facilitation of transit as a prerequisite:

Each Contracting Party shall take the necessary measures to facilitate the
Transit of Energy Materials and Products consistent with the principle of
freedom of transit and without distinction as to the origin, destination or own-
ership of such Energy Materials and Products or discrimination as to pricing on
the basis of such distinctions, and without imposing any unreasonable delays,
restrictions or charges.
Article 7 sets two aspects of facilitating transit: access to existing networks

and construction of new transport capacities on the territory of a third
country. Article 7 does not require third party access to the networks,
unlike, for example, EU internal market legislation, which was elaborated
later.
The question raised during the ECT process is whether the domes-
tic energy transport and cross-border transit tariffs should be uniform.
Moreover, domestic legislation rarely distinguishes between domestic and
cross-border transport flows, which complicates the separation between
the two. Ambiguous normative provisions made Russia hesitant about
the charter. Indeed, Russia is an important transit state for Central Asian
gas to Europe through swap agreements: Russia purchased gas from
Turkmenistan to its own domestic market and exported part of its own gas
to Europe on behalf of the Central Asian state. In practice, it would mean
that Russia buys Turkmen gas without setting domestic rules for transit. As
the conditions for export of Turkmen gas to Europe are concluded by bilat-
eral agreements and Russian domestic gas transport by the Russian regula-
tor, one could consider that Russia applies a differentiated tariff mechanism
for Turkmen and Russian gas flowing through Russia. The issue was
brought up later during the Transit Protocol negotiations, which have been
analysed in detail by many other prominent experts (Konoplyanik, 2009).
An important aspect of the ECT transit regime is the existence of a
mediation mechanism foreseen by Article 7 (7). Transit dispute settle-
ment relates to non-discrimination and national treatment with regards to
transit and construction of new transport capacities. The text of the article
puts forward a mediation mechanism, which provides a certain flexibility
for actors in dispute. The Energy Charter Secretary General designs a con-
ciliator, who, in turn, has to find a compromise solution within 90 days.
As was proved later, an inherent difficulty of both conciliation and arbi-
tration mechanisms consists in the slow procedures, whereas the transit
conflicts are usually very short and need a fast resolution. Length of the
procedures demonstrated a practical ineffectiveness of those mechanisms
in the transit disputes, which occurred more than a decade after the con-
clusion of the treaty. It is interesting to note that the conciliation mecha-
nisms were not accepted by Russia and Ukraine whilst they were involved
in the transit conflicts (Yafimava, 2011; Belyi, 2012).

2.4 Investment Protection within the Energy Charter
A multilateral investment protection process can represent a positive trend

towards a unification of energy investment governance. In the ECT, the
investment regime includes general terms of investment protection based
on positive reciprocity and MFN principle, iterates a fair compensation
for investors in case of expropriation and represents a balance between a
principle of national sovereignty and investors’ rights.
The scope of the investment provisions (Art. 10) covers fair and equita-
ble treatment, “most constant protection and security” for investors as well
as an obligation to protect any contractual arrangement. All these aspects
demonstrate a requirement for general conditions for doing business in
a country (Hober, 2010). Oil and gas upstream investments have often
involved conflicts between host states and international investors. Indeed,
investors are attracted mainly during low oil prices, whereas states attempt
to reinforce control over the oil and gas production during high oil prices.
Investors attempted to use various mechanisms of protecting the invest-
ments against a sovereign state. Clear norms on investment arbitration
increases the level of predictability for an investor, which is reinforced by
a broad definition of investments by the ECT. For example, investments
include various forms of activities in energy, such as licensing for explora-
tion, production and development. Hence, an upstream license holder can
be considered as an investor (license being a property right) and therefore
can be protected accordingly.
Furthermore, the definition of investments is directly related to the
issue of expropriation of foreign assets. In the ECT, expropriations are
not forbidden but are put under a number of conditions related to a
non-discriminatory aspect of expropriation:
(a) for a purpose which is in the public interest;

(b) not discriminatory;
(c) carried out under due process of law; and
(d) accompanied by the payment of prompt, adequate and effective
compensation.
The issue of compensation for expropriation has been addressed by

various scholars (Collier and Lowe, 1999; Hober, 2010) and will therefore
not be examined here. Nevertheless, the very idea of compensation for
investment breach creates a stable ground for establishing business by an
investor in the energy sector. In addition, evaluating damages becomes a
counter-stone to the high transaction costs related to the legal and political
system of the host state.

The issue of national control over resources has always been an impor-
tant factor in energy producing states. The ECT attempts to balance
interests of sovereign states with investors’ rights. In its Article 17, the
ECT stipulates on non-application of the investment provisions in certain
circumstances, which are related to general political relations with another
state (i.e. interrupted diplomatic relations, adoption of unfriendly meas-
ures by another state, etc). Article 17 results from a necessary protection
of state sovereignty in international economic relations regarding invest-
ments. Later, the ECT investment jurisprudence demonstrated that the
provisions of Article 17 apply for access to new investments whereas they
cannot apply to existing investments.
A similar balance between sovereignty and international obligations is
translated in Article 18, which declares national sovereignty over resources.
Interestingly, Article 18 links sovereign rights over resources to the respect
of international norms and agreements, which are not further specified.
It would then cover other norms declaring the sovereignty over resources
as well as norms of investment protection. If the investment has already
occurred (post-investment phase), the investors’ rights should be then
respected. However, access to the resource remains a discretionary power of
the states: “The Contracting Parties undertake to facilitate access to energy
resources, inter alia, by allocating in a non-discriminatory manner on the
basis of published criteria authorizations, licences, concessions and con-
tracts to prospect and explore for or to exploit or extract energy resources”.
Relations between the sovereignty over resources and obligations
towards investment protection remained one of the most complex areas
between hydrocarbon-producing states and investors. As T. Waelde has
pointed out, economic cycles of oil price often contributed to the balance
of interests: there was more tension between states and investors during
high oil prices than during low oil prices (Waelde 2008). Therefore, states
must first accept the rule of law in order to make the treaty provisions
effective. At the same time, a non-acceptance of investment protection
rights may stem from the securitization of the access to resource issue in
hydrocarbon producing states. The major concern of the Energy Charter
process has indeed been related to a non-acceptance of its norms by most
of the energy exporting states. None of the OPEC countries signed up to
the Treaty, whereas big OECD energy exporters (Australia and Norway)
refused to ratify the text and hence to integrate it into national legislation.
2.5 Energy Efficiency Issues
The ECT marks the first step towards integration of sustainable and effi-
cient development into energy cooperation, although these provisions are

still not binding. Energy efficiency is recognized as an additional source

of energy as it represents an improved ratio between energy consumption
and economic output. ECT Article 19 stipulates: “‘ Improving Energy
Efficiency’ means acting to maintain the same unit of output (of a good or
service) without reducing the quality or performance of the output, while
reducing the amount of energy required to produce that output.”
The ECT does not establish a legally binding regime on energy effi-
ciency, nor does it set the targets to achieve. Instead, the ECT repre-
sents an investment protection regime, which also covers environmental
investments.
It should also be noted that the ECT was signed three years before
the Kyoto Protocol and therefore international actors were less cautious
about a global environmental regime. The only treaty document which
elaborates on the topic of energy efficiency is a non-binding Protocol on
Energy Efficiency and Related Environmental Aspects.
Consequently, we can observe that the energy efficiency regime became
part of a more holistic system of governance, which also included an
investment protection and energy trade. For instance, it could be argued
that the ECT investment regime could be used to protect environmen-
tal energy efficiency investments. And in turn, the energy saved would
become commercializable. Nevertheless, interest in the ECT process from
the energy efficiency perspective has paled in the context of the climate
change mitigation regime.
2.6 Institutional Setting
The ECT established two institutions which contributed further to

the process: the Energy Charter Conference and the Energy Charter
Secretariat. In accordance with the treaty, the Energy Charter Conference
is the decision-making institution, which takes place once a year and
which is composed from governmental representatives of the Contracting
Parties. The Energy Charter Secretariat was established in 1996 in order to
create a regular institution. For instance, arbitration cases are registered at
the Secretariat. Moreover, the Secretariat holds regular thematic working
groups (i.e. on transit and trade and on investments). Although the scope
of activities has been wide, the Energy Charter institutions have not been
successful in decreasing the level of politicization of energy transactions.
In addition, Moscow has often perceived the activities of the Secretariat as
being EU-sponsored.
With an intergovernmental body and a Secretariat in place, the Energy
Charter took the shape of an international organization. Nevertheless,
the very institution of the Charter has not aimed at creating a new “UN

Security Council” in energy. In other words, unlike the Security Council,

which is created to reinforce international security governance, the ECT
does not envisage being a supranational authority. Hence, the ECT insti-
tutions (including dispute settlement mechanisms) are used only if the
contracting parties wish to do so (the UN Security Council may take deci-
sions regardless of the choice of the states). In addition, the ECT foresees
a quinquennial review of the process and thereafter contracting parties can
either enlarge or reduce competences of the Secretariat or even dissolve it.
Institutional limits can furthermore explain a relatively passive role of the
Secretariat during the gas transit crises, which are discussed below.
Consequently, the Energy Charter Conference decided to establish the
monitoring of entry barriers to investment rather than a legally-binding
supplementary treaty. In 2004, a consultation forum was set with an
Industry Advisory Panel, which was intended to present the industry view
on investment access barriers. Again, the Industry Advisory Panel consul-
tations do not create a legally binding regime. It demonstrates however
that private commercial actors, in particular energy investors, are keen to
see the multilateral investment regime in place.
3 EU-RUSSIA CONTROVERSIES ON INVESTMENT

AND TRANSIT GOVERNANCE
Although the ECT represents a very deep and overarching legal frame-
work, important controversies occurred between the European Union
and Russia vis-à-vis the international energy governance from the early
existence of the Energy Charter process. Russia’s assertiveness in interna-
tional affairs and in its model of state capitalism impacted on its vision on
international energy markets. In particular, Russia defended a concept of
security of demand in the G-8 Summit hosted in St. Petersburg in 2006.
Meanwhile, the EU was in the process of regionalizing energy governance,
which was characterized by a conclusion of the Energy Community Treaty
in 2005. This, in turn, created a foundation for the EU-based governance,
which is exported beyond the Union’s political borders.
Contradictions with Russia mostly emerged after the signature of the
ECT. Russia’s “alternative proposal” constituted a culminating moment,
which also led to a termination of the provisional application by Russia
by the end of 2009.4 In geopolitical terms, in the early 1990s Russia repre-
sented an alternative supply to the Middle East; two decades later indus-
trialized nationals preferred to diversify supplies from Russia. Moreover,
the Eastern enlargement of the EU further reinforced energy dependency
of the newly accessed member states on Russia (Belyi, 2003).

3.1 Controversies Surrounding Investment Protection
Russia’s post-Soviet resource access regime has been marked by post-

command economy legacies, especially regarding property rights and the
maintenance of a strong link between the state and extracting industries.
At the same time, Russian energy policies of the 1990s would have com-
pared badly with the Middle Eastern and Latin American oil producers.
Russia favoured a privatization of the oil sector and initially adopted
investor-friendly legislation. Nevertheless, the post-Soviet understanding
of property rights and of the investment differ from the spirit promoted by
the Energy Charter.
From the early 2000s especially, Russian policy started to prioritize
resource nationalism based on non-acceptance of international inves-
tor’s rights. Russia did not proceed to large-scale contract renegotiation.
However, the country established an indirect form of governmental control
over extractive industries. A mineral exploration license can be revoked by
a ministry without a preliminary court decision. In turn, the investor may
claim its rights against the ministry after a Russian court hearing. In this
case, the Russian state becomes a pivotal player for any international con-
tract negotiation for oil and gas upstream. In other words, for the Russian
state, revocation of license is a political issue rather than a legal one. And
therefore reciprocity may be applied for access upstream.
Russia’s market remains barely accessible for international investors. In
response to the concerns of national resource control, Russia adopted leg-
islation which allows Russia to limit or to increase the presence of a foreign
investor in a strategic enterprise. The recent Strategic Sector Law5 applies
to investments above certain thresholds by non-Russian Investors. Its
Article 6 lists 42 activities to which the national regime is restricted at the
pre-investment phase. That clearly contradicts MFN-based reciprocity.
Instead, under this quota allocation mechanism, Russia allowed a number
of foreign investments into its energy sector through the inter-company
package agreements. Consequently, retaliatory reciprocity became a
practice in energy investment at the pre-investment phase and thus the
multilateral MFN principle has been hindered.
In turn, the EU moved towards a liberalization of energy markets, which
has required a fragmentation of companies. The EU third gas directive
(2009) requires an unbundling of both Community and non-Community
undertakings. Hence, non-European vertically-integrated companies
would face an obligation to sell their assets in energy transportation,
which subsequently provoked legal conflicts with non-EU investors
(Willems et al, 2010). In this way, the Directive also avoided a massive
sell-out of strategic EU energy assets to the external monopolies with strict

certification procedures. Subsequently, investors’ rights would be condi-

tioned with respect to competition norms, which is hardly in keeping with
the ECT liberal approach. The EU legislation based restrictions created
grounds for the specific regional conception of a market transformation.
3.2 Different Views on Transit Governance
ECT transit governance has been largely associated with the Transit
Protocol, which aimed at clarifying the aforementioned ECT provisions
on transit. The Transit Protocol represents the longest international nego-
tiations within the ECT framework. In 1998 at the G-8 Summit, Russia
proposed to reinforce the transit regime under the ECT framework. Its
main concern at that time was transit theft, which occurred frequently
in the energy flows to Ukraine. In December 1999 the Energy Charter
Conference was mandated to negotiate the Transit Protocol, which
aimed to clarify the provisions of Article 7 (1). In parallel, the Conference
adopted non-binding Transit Model Agreements. Transit Protocol nego-
tiations entered into a murky area during the repeated transit crises, which
have occurred in FSU area since 2004.
In December 2002 a final draft of the Transit Protocol was proposed.
The Protocol deepens the initial objective of “facilitating” transit under
Article 7(1) of the ECT. The Protocol stipulates a number of obligations
regarding transit:
(a) to ensure secure, efficient, uninterrupted and unimpeded Transit for the
benefit of all Contracting Parties concerned; (b) to promote transparent and
non-discriminatory access to and use of Available Capacity in present and
future Energy Transport Facilities used for Transit; (c) to facilitate efficient use
of Energy Transport Facilities used for Transit; (d) to facilitate the construc-
tion, expansion, extension, reconstruction, and operation of Energy Transport
Facilities used for Transit; (e) to minimise harmful Environmental Impacts of
Transit; (f) to promote the prompt and effective settlement of disputes relating
to Transit.
The Transit Protocol defines the scope of available capacity in cross-

border pipelines. The Protocol stipulates a definition of available capacity,
which should be uniform for any transit agreement. For hydrocarbons,
definition of available capacity includes:
forecasted requirements, for the transportation of Energy Materials and

Products which are owned by the owners or operators of the Energy Transport
Facilities or their Affiliates; and (d) necessary for the efficient operation of
the Energy Transport Facilities, including any operating margin necessary to
ensure the security and reliability of the system.

For the electricity sector, the Transit Protocol defines capacity in terms of
possibility of flow and reverse flow.
Under the terms of Article 8 of the Transit Protocol, a contracting party
must justify a denial of available capacity. In addition, there is an obliga-
tion to fulfil an existing long-term supply contract and hence to renew
transit agreements in order to avoid a mismatch between supply and
capacity agreement.
In addition to that, the Transit Protocol iterates the prohibition of
unlawful taking of energy by a transit country or its network operator
(Article 6) and to apply discriminatory tariffs on different capacity users
(Article 10).
In December 2002, Transit Protocol negotiations were stalled mainly
due to the EU-Russia controversies (Konoplyanik, 2009). Between 2003
and 2007 the EU and Russia processed bilateral consultations over the
Transit Protocol. In order to avoid a mismatch between supply and capac-
ity agreements in accordance with Article 8 (4) of the Protocol, Russia
suggested a concept of “right of first refusal”, which would allow a sup-
plier of the long-term obligation to have the right to conclude a transit
agreement in the first place. Initially, European countries opposed the
idea of the “right of first refusal” as such in order to promote an easier
transfer of capacity agreements. In 2005 a compromise was proposed. The
idea was that the “right of first refusal” could be used where other suppli-
ers had access to the available capacity (Konoplyanik, 2009; Blamberger
and Waelde, 2007). Nevertheless, the Russian position has changed since
2005 and in 2006 a de jure gas export monopoly over Russian gas was
established by Russian legislation. The export monopoly might create
difficulties for Central Asian gas to get a share of transit gas through the
Russian network.
After the adoption of the second Energy Directives in 2003, the
European Community declared itself a Regional Economic Integration
Organisation (REIO), which is an internal market per se and hence does
not have transit within the EU. The concept of transit may then only be
applicable if gas flows cross Switzerland. The REIO clause meant that the
Transit Protocol is not applicable in the EU. According to Konoplyanik
(one of the best known experts in the field who until 2007 was a Deputy
to the Secretary General of the Energy Charter), the REIO clause
remained the only unresolved issue within the Transit Protocol negotia-
tions (Konoplyanik, 2009). Indeed, exemption of the EU from interna-
tional transit norms indicated to Russia that the EU was mainly interested
in the undisrupted transit of gas through Russia from Central Asia. The
main issue raised in Moscow then became: why accept the regime, if it is in
turn abandoned by the EU?

In December 2007, the Energy Charter Conference demanded to con-

tinue the negotiations at a multilateral level, although a political compro-
mise between the EU and Russia was not fully founded. Moreover, during
the Transit Protocol negotiations and consultations, Russia expressed
concern regarding the aforementioned mediation procedures of Article 7
(7). Russia expressed concern about mediators’ rights to control volumes
and supplies during the 90 days of mediation (Belyi, 2009). The issue was
about control of a strategic resource and therefore Article 7 (7) of the
Treaty itself needed to be clarified.
It should be noted that from the very beginning, Moscow and Brussels
had a different understanding of the use of the Protocol. For the Russians,
the Protocol represented an opportunity to renegotiate the treaty, par-
ticularly the issue of transit tariffs and mediation mechanism of Article 7
(7). From the EU perspective, such a formula highlighted an important
political position against the ECT itself as the Transit Protocol could not
revise the ECT.
A divide between the EU and Russia over the Transit Protocol demon-
strates a conflict in the interpretation of the norms of energy governance.
For Russia, the Transit Protocol aims to secure the long-term supply
chain (avoiding gas theft by transit countries, for example) and hence
avoiding unnecessary competition. For the EU, the Transit Protocol
aimed to bring new aspects of competition into the FSU area and there-
fore needed to provide flexibility in the gas supply chain. Likewise, the
EU conception of the REIO was based on the principle that EU freedom
of movement represents a more favourable system of governance than
the ECT transit regime. Nevertheless, Russia considered the EU model
mismatched supply obligations and access to capacities (Finon and
Locatelli, 2007).
3.3 Transit Conflicts Impact on ECT Governability
A culmination of the controversy surrounding transit governance

occurred during the gas transit crises between Russia on one hand,
and Belarus and Ukraine on the other. Since the collapse of the USSR,
Russia and the transit states (Belarus and Ukraine) established bilateral
company-to-company relations, which allowed barter deals based on
political accord. For instance, Russian Gazprom may pay a pre-established
transit fee in natural gas in exchange for transit services made by a transit
state. Up to 2005, Russia allowed its direct neighbors, Belarus, Moldova
and the Ukraine, to enjoy lower tariffs through direct bilateral political
agreement. Barter agreements have allowed Russia to avoid additional
payments for gas transit. In response to the increased supply tariff, both

Belarus and Ukraine required a transit fee increase and used their “transit”
position to strengthen their negotiating position with Russia.
In the case of Belarus, conflicts occurred in 2004 and then in 2007 and
resulted in Gazprom getting a share of 50 per cent of Belarus’ natural gas
network company (Yafimava, 2011). Non-payment problems led again
to a short-term gas supply cut during the summer of 2010 by Gazprom,
which did not echo in Europe.
In the case of Ukraine, conflicts occurred several times and
culminated in January 2009, when Russia decided to halt all deliver-
ies through Ukraine and which represented up to 80 per cent of all its
exports. One must consider the obscurity of these negotiations as well
as the non-transparent situation around transit flows. Russia accused
the Ukraine of taking more than the transit flow required. Ukraine,
in turn, accused Russia of under-supplying gas (Pirani et al, 2009).
Consequently, the situation was very similar to the crisis of January
2006. The difference, however, is that neither party made any further
efforts to conclude an agreement. Consequently, a new gas crisis
occurred, which caused much greater damage to the actors involved, as
well as to the energy dependent European states compared to the 2006
crises (Mitrova et al, 2009).
An interesting question arose: could Russia use the ECT framework
to resolve disputes with Belarus and Ukraine (Belyi and Klaus, 2007)? It
could be argued that Russia actually could have used the transit dispute
settlement of Article 7 (7) to its advantage. But an overall political under-
standing of the ECT did not allow Russian actors to use it to their advan-
tage. Russia rejected the use of the ECT dispute settlement for transit
mainly due to the perception of the Charter’s pro-EU orientation.
In the context of REIO, Gazprom prefers to deal with the FSU part-
ners bilaterally. Gazprom prefers to set a number of bilateral deals on
transit with the transit states and avoid a capacity-supply mismatch,
which can occur in the liberalized European energy markets (Finon and
Locatelli, 2008). Therefore, Gazprom saw an opportunity in securing
transit by increasing the so-called asset swaps: Gazprom opened parts of
the upstream process to the European companies and in exchange received
shares in the European downstream, hence securing access to the network.
Nevertheless, the crisis with Belarus in 2010 demonstrated a vulnerability
of controlling assets for energy security. Although Gazprom owned 50
per cent of the transit network, the gas supply was disrupted. Russia’s
approach of asset-exchange (Finon and Locatelli, 2008) does not remove
the issues of access to capacities, of mismatch between supply and transit
contracts and of cost-effectiveness of tariffs.

4 EU AND RUSSIAN POSITIONS: REINFORCING

OR MARGINALIZING THE ECT?
Controversies surrounding the international energy governance further

impacted on the respective positions of the EU and Russia regarding the
ECT. There is a paradox in the fact that the idea of an international energy
governance is backed in both Brussels and Moscow, in spite of the rela-
tively marginal role of the ECT in their respective policy agendas. There is
still a disagreement between the EU and Russia about the centrality of the
ECT: Russia prefers to revise the existing treaty, whereas the EU hopes for
its further expansion.
4.1 Russian Specific Position and “Conceptual Approach”
In the aftermath of the Russia-Ukraine gas transit crisis, Russia

announced its withdrawal from the ECT”s provisional application.
Indeed, prior to 2009, Russia applied the Treaty provisionally, which sig-
nifies that Signatories take their responsibilities after the Treaty before the
completion of ratifications and the entry in force:
Each signatory agrees to apply this Treaty provisionally pending its entry into
force for such signatory in accordance with Article, to the extent that such pro-
visional application is not inconsistent with its constitution, laws or regulations.
Nappert (2008) argues that effects of provisional applications are still

unknown in international jurisprudence. The ECT jurisprudence opened
the issue with Kardassopoulos vs Georgia case,6 which declared that the
provisional application between signature and ratification requires adher-
ence to general treaty-based obligations. Article 45 (2) also states that
a signatory can choose not to apply the treaty provisionally from the
moment of signature. Australia, Iceland and Norway made a declaration,
according to which the treaty is not applicable to them before ratification.
Russia, by contrast, did not make a similar declaration and therefore is
bound by the treaty (Nappert, 2008, 113).
The 2009 Yukos case,7 which directly involved Russia, focused impor-
tant attention to the obligations inherent in the provisional application. In
essence, Yukos, a Russian oil company, was sold in 2004 after accusations
of tax evasion. Subsequently, its largest subsidiary Yugoneftegansk was
sold to state-owned Rosneft. In response, international shareholders initi-
ated a case based on the discriminatory and retroactive tax reassessment
of Yukos’ tax payments (Waelde, 2008, 74). An important preliminary
conclusion by the arbitral tribunal in this case was that Russia could be

responsible under Article 45 of the treaty. It has been often argued that
Russian withdrawal from the provisional application of the treaty in
2009 was largely conditioned by the arbitral decision on the Yukos case.8
However, this would be unlikely because in 2004 Russia was still respon-
sible under provisional application and therefore a withdrawal from the
ECT in 2009 would not have made sense.
Russian provisional application came to an end in 2009 subsequent to
Russia’s formal announcement of non-ratification of the treaty. On 20
April 2009 Russia tabled an “alternative” to the ECT: the “Conceptual
Approach to the New Legal Framework for Energy Cooperation” (Belyi
and Nappert, 2009; Belyi et al, 2011). Broadly worded and in the form of a
statement of principles at this stage, the “Conceptual Approach” includes
many principles and practices which have previously been debated and
adopted: sovereignty over natural resources, ensuring non-discriminatory
access to markets, transparency, access to technologies, exchange of
information, etc. Russia supported the idea of extending the ECT to
other countries (including the US and producing countries) and covering
a broader scope of energy sources (e.g., nuclear). Transit conflicts were
given a more global dimension. This would create a governance of energy
markets that would be broader and based more on political than legal
considerations.
Several months after the proposal was made, Russia announced its
non-ratification of the ECT itself. This constituted a clear political
message that the ECT needed to be revised. At the same time, the effec-
tiveness of the Russian proposal much depended on Ukraine’s support
of the new governance proposal. Importantly, Russia did not withdraw
from the ECT in December 2009 despite domestic pressure to abandon
the ECT.9 It could be argued that the Russian “Conceptual Approach”
aimed to create political grounds for a new round of Energy Charter
discussions. A concrete result of the Russian moves towards revising
the ECT consisted in a termination of the provisional application in
early 2010.
Nevertheless, the Russian “Conceptual Approach” demonstrated a will-
ingness to continue the multilateral process. Substantially, a declaration
of non-ratification only repeated the earlier decision of the State Duma,
back in 2001 (Konoplyanik, 2009, 100). In spite of the mixed messages on
Russia’s further participation in the ECT, Moscow did not withdraw its
signature from the treaty. At the same time, a full withdrawal from the
process may harm Russian investment and transit interests outside Russia
in the longer run.

4.2 The EU’s External Energy Policy and the Position Regarding the
ECT
Albeit the EU external energy policy was not an evident step at the begin-
ning of the process, it is now taking a certain shape. In 2011 and 2012
two important external energy policy (EEP) initiatives were issued by
the European Commission and the European Parliament respectively
(European Parliament, 2012). The European Parliament outlines the
importance of the stability of long-term investment and of multilat-
eral cooperation. Promotion of the internal market becomes the key
point in the constitution of EEP. Furthermore, export of the internal
market norms constitutes an important part of the EU’s external policy.
Communication issued by the European Parliament makes an explicit
link to the Energy Charter as the global governance framework. The
document reiterates the need to reinforce the Energy Charter Treaty by
“extending the Energy Charter Treaty to countries which have not yet
signed or ratified it”.
The European Parliaments document remains silent on the pre-
investment non-discrimination and on the involvement of the US into the
multilateral framework. Although the EEP documents outline the impor-
tance of multilateral cooperation, the EU’s influence remains limited in
energy producing countries because of resource nationalism.
Moreover, the Energy Community Treaty of 2005 introduced a qualita-
tively new relationship between the EU and the abovementioned non-EU
countries of Europe on energy trade. The Energy Community will follow
the acquis communautaires (art. 5) related to the EU internal energy
market as well as the European Community’s competition norms (art 18).
The impact of EU harmonization should also spread to the Contracting
parties of the Energy Community Treaty.
Although the Energy Community Treaty does not explicitly contra-
dict the multilateral Energy Charter Treaty, it gives a new character
to the international energy governance (Prange-Ghstol, 2009). If the
Energy Charter Treaty provides a framework for governance, including
investment protection, the Energy Community Treaty aims at actual
market transformation, which implies investors’ commitments to com-
petition. In turn, the transformation should be guided by the EU energy
market norms. Thus, the multilateral character of the governance is
replaced by a regional bloc governance with EU regional leadership.
Thus, a hidden contradiction between a multilateral and a bloc gov-
ernance might further affect the EU’s evolving external energy policy
conception.

5 CONCLUSION
The debate on energy security needs to be reshaped from the producer-

consumer divide towards an institutional analysis of enhancing predict-
ability of relations within international energy markets. A multilateral
legal regime is a reflection of a demand for more predictable relations for
both energy producers and consumers, as well as for states and investors.
Predictability can be ensured by multilateral level governance.
At the same time, multilateralism supposes a number of shared values,
which is still not the case with the ECT. Acceptance of norms has been
hindered by opposing views on energy security. Russia’s view evolved
towards a security of demand combined with resource nationalism. The
EU conditioned the international energy governance to the promotion of
competition and apparently preferred a market transformation approach
for the Energy Community Treaty. With the Energy Community Treaty,
the EU promotes itself as a norm-creator, a position which further
distances Russia from the framework. Hence, the ECT case study dem-
onstrates an ever-evolving fragmentation of norms in the post-western
hegemonic international political economy.
At the same time, it could be argued that a relative marginalization of
the ECT did not lead to a rejection of an issue-specific multilateral regime
in energy. The EU legal system of the Internal Market (especially, owner-
ship unbundling and reciprocity clause) complicates the implementation of
the ECT, but the treaty itself has so far not been questioned. The External
Energy Policy conception reiterates the importance of the ECT. Despite its
“alternative proposal”, Russia did not withdraw from the treaty. Growing
interdependence between producing and consuming countries, an increas-
ing number of cross-border investments as well as possible mismatches
between transport capacity and supply obligations led to a demand of pre-
dictability. On these grounds, we can note that at least four aspects dem-
onstrate the relevance of the ECT-based energy governance: (1) the ECT
provides the most overarching framework for protection of investments,
including environmental ones; (2) the ECT represents a trend towards the
MFN principle in the energy investment field, which could counterbalance
the retaliatory reciprocity; (3) the ECT did not discredit itself during the
transit crises as it was not used; and (4) the ECT remains the only currently
existing realistic framework of legally binding relations involving the EU,
Russia and the transit states.
International energy governance requires a certain level of acceptance
by both producing and consuming states. In the meantime, the very under-
standing of energy security remains controversial and therefore hinders
the applicability of the ECT.

NOTES
1. The Energy Charter is the first overarching political and legal framework for an inter-
national energy governance, set as a political declaration in 1991 and then evolved to
a Treaty in 1994. For a detailed legal analysis, see Walede (1996), Happ (2002), Salem
Haighighi (2006), Blamberger and Waelde (2007), as well as the website of the Energy
Charter Secretariat www.encharter.org (accessed February 2013).
2. Charter of Paris for a New Europe, 1990.
3. The concept of “seminar diplomacy” is defined by Adler (1997).
4. For details, see the website of the Energy Charter Secretariat: http://www.encharter.org/
5. Baker & McKenzie (2008), “Review of Amendments to the Law of the Russian
Federation ‘On Subsoil’”, working paper, Moscow, April, pp. 1–2.
6. Case No. ARB/05/18, Ioannis Kardassopoulos (Greece) v. Georgia, ICSID.
7. Yukos Universal Ltd. (UK – Isle of Man) v. Russian Federation, Ad hoc UNCITRAL
Arbitration Rules; arbitration administered by the Permanent Court of Arbitration
(PCA) in The Hague.
8. This opinion was proposed by one of Yukos’ arbitrators, E. Gaillard for Financial Times,
18 August 2009.
9. Konoplyanik (2010) has gathered quotations from Russian officials.
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Yafimava, Katja. (2011) The Transit Dimension of EU Energy Security, Oxford University
Press.

PART V
ENERGY, THE
ENVIRONMENT AND
SECURITY

14. Governance dimensions of climate and
energy security
John Vogler and Hannes R. Stephan
1 INTRODUCTION
For a long period ‘security’ was both a central, yet extraordinarily under-
developed, concept in International Relations. Critical scholarly attention
really dates from the pioneering work of Barry Buzan (1983). Since then
varying security perspectives have proliferated. Environmental security
became the subject of a long-running debate and the 1994 UN Human
Development Report introduced the people-centred approach of human
security (Dalby 2009). It is now commonplace not only to emphasize
national border security, but also refer to food security, water security,
and other ‘sectoralized’ security areas (Brauch et al. 2009). This expansive
re-definition should alert us to the significance of the ‘referent object’ or,
in other words, ‘that which is to be secured’. In orthodox security studies,
there is no doubt that the object of security policy remained the integrity of
the state and its interests. There might be reference to people, but as Buzan
(1983, p. 245) noted, there was always ‘an unbreakable paradox’ between
state and individual security. In much recent security discussion notions
of threat may have changed, as in the typical security triptych of ‘terror-
ism, failed states and weapons of mass destruction’, but the preservation
of the state remains the essential object of policy. Energy security, often
with overtones of control over contested scarce resources, is convention-
ally seen as a central component of the national interests of a state and
not infrequently a casus belli. This is also true of the overwhelming bulk of
environmental security discussions including those relating to the actual
and possible conflict consequences of global climate change. However, the
really radical move would be to shift the object of security from the state
to human populations and then to the earth’s climate upon which they
depend.1
While there are several significant greenhouse gases (GHGs), current
mitigation efforts concentrate on energy-related carbon emissions which,
in 2005, accounted for around 61 percent of all GHG emissions (Baumert
et al. 2005) and whose importance rises in line with increasing global energy
consumption. In Europe, the figure is even higher at 80 percent (European
297

Commission 2007, p. 3). This physical link lies behind the evolution of the
UN Framework Convention on Climate Change (UNFCCC) over the
past decade. It largely explains why energy and climate change agendas
have become increasingly intertwined. The particular characteristics of
the Kyoto Protocol meant that, for an extensive period, most Parties were
able to avoid this conjunction. Non-Annex I developing countries were
not required to make any reduction in their fossil fuel-based emissions
and the EU could sustain its climate ‘leadership’ without having to make
significant cuts in energy use through the fortuitous use of the 1990 base-
line in its burden-sharing agreement. The United States, which would
under the Protocol have had to make real and economically damaging
energy-related reductions, simply opted out; while others either failed to
meet their obligations or were able to take advantage of carbon offsets.
In the post-2012 discussions, which followed entry into force of the
Protocol in 2005, the energy-climate connection became all too painfully
clear and dominated the international discussions leading up to the 2009
Copenhagen Conference of the Parties (CoP). At the highest level, climate
politics became international energy politics and could be portrayed as a
competition to secure shares in a diminishing ‘carbon space’ or, perhaps,
to ensure that the burdens of reductions in energy use should be borne by
others. Energy security has habitually been associated with ‘high politics’
and it was noticeable that, in this regard, the climate CoP at Copenhagen
departed markedly from other analogous ‘low politics’ environmental
regimes.
The primary purpose of this chapter is to understand the
energy-climate nexus within a security framework. We proceed by ini-
tially analysing both domains in their own terms. The energy security
agenda is characterized by (geo)political and material (scarcity) con-
straints, and governance responses have largely been confined to the
national arena. By contrast, climate change has long been subject to mul-
tilateral, UN-related governance processes. Explicit security lenses have
been applied to the potential short- and long-term impacts of climate
change. Associated policy responses can be broadly categorized as reac-
tive or preventive. Finally, the third section provides a conceptual and
institutional comparison between energy security and climate security
agendas and considers the important question of ‘synergies’ between
them, leading perhaps to the elusive ‘win-win’ solution under which a
progressively de-carbonized economy might provide for really compre-
hensive security in terms of climate stability, sustainable energy and the
avoidance of the more disruptive traditional threats associated with rapid
climate alteration.

Governance dimensions of climate and energy security 299
2 ENERGY SECURITY
The standard definition of energy security was forged amidst the oil crises
of the 1970s and remains a conceptual cornerstone: ‘access to secure,
adequate, reliable, and affordable energy supplies’ (Bordoff et al. 2009,
p. 214). It should also be remembered that for producers, energy security
means continued demand and market access. Energy security represents
a broad, if rather vague, placeholder for a range of policy-making priori-
ties. Admittedly, it does not adequately address other important aspects
of energy governance such as carbon emissions or overall environmental
sustainability. To keep these concerns separate nonetheless reflects the
reality of policy-making where successful policy integration is rare, whilst
parallel, competing tracks are still the norm. But even according to the
orthodox definition, there have been plenty of reasons in recent years to
highlight growing energy insecurity. The rise of major energy-consuming
economies, such as China and India, has lowered overall confidence in
‘secure’ and ‘affordable’ energy supplies. Affordability may be compro-
mised due to an increasing imbalance between the demand and supply
of fossil fuels and especially the widespread recognition of ‘the end of
easy oil’. Secure access may be at risk because increasing scarcity implies
greater international competition and encourages a move away from
market allocation towards ‘statist’ forms of energy security.
Historically, realist theoretical assumptions have dominated thinking
on energy security. Widespread recognition of the role of energy resources
during the build-up and conduct of the Second World War ensured the
status of energy as an issue belonging to the ‘high’ politics of national
security. The role of energy as a ‘strategic good’ par excellence is not only
related to its essential function in ‘fuelling’ military activities. Its price
level and availability also play a fundamental role in a country’s economic
performance and socio-political stability (Lesage et al. 2010, p. 183). A
realist interpretation of energy security was further reinforced by events
in the 1970s when a trend towards the nationalization of energy supplies
and the sporadic use of oil embargoes, orchestrated by the Organization of
Petroleum Exporting Countries (OPEC), highlighted the dangers of energy
dependence. Even today the privileged position of major energy-exporting
countries still represents a constraint on the foreign policy agenda of
major importers (Müller-Kraenner 2008, p. 27).
Market expansion and low energy prices from the 1980s until the
mid-2000s encouraged the development of liberal approaches to energy
security. Greater diversification of sources and a gradual shift to coal
and natural gas all but eliminated the threat of an effective use of the
‘oil weapon’. Well-functioning global markets for oil – and potentially

for liquefied natural gas – have been increasingly promoted as effective

mechanisms to provide cheaper energy inputs in an increasingly competi-
tive, global economy and guard against both structural undersupply and
short-term supply disruptions (Goldthau and Witte 2009). Realist notions
of energy security, however, have not been superseded. On the contrary,
Brazil, Russia, India, and China – the so-called BRIC states – are not
just consuming increasing amounts of fossil fuels. They also employ the
traditional, statist tools of energy security policy such as bilateral con-
tracts and the promotion of national energy champions (Lesage et al.
2010, p. 27). China and India have struck numerous energy deals with
oil- and gas-exporting countries from around the world, even if this has
meant giving economic and military aid to ‘pariah’ states in Africa and
Latin America (Müller-Kraenner 2008, p. 72). While this has served to
raise rather than lower the availability of fossil fuels on global markets, it
demonstrates that – given an uncertain future – no major power will rely
exclusively on the market allocation of energy supplies.
When it comes to natural gas, a commodity still largely reliant on
pipeline infrastructure and long-term supply contracts, overtly politi-
cal considerations have remained dominant. The European Union, for
example, has yet to produce a coherent energy policy or to perfect a ‘real
internal energy market’ (European Commission 2007, p. 6). There are very
significant differences in the energy mix and strategies of member states
whose perspectives remain stubbornly national. Thus the Commission’s
principal approach has been to seek energy security through the perfection
of a properly functioning, interconnected and transparent internal energy
market. There has also been a largely unsuccessful attempt to extend EU
liberalising regulatory practices to the EU’s gas suppliers in its eastern
neighbourhood. Failure was demonstrated in the twin Ukrainian gas
crises of 2006 and 2009 which were only resolved through EU mediated
political agreement between Russia and Ukraine.
Russia, having rejected the EU’s invitation to subscribe to the Energy
Charter Treaty, increasingly relies on its economic power derived from
natural resources and energy services. It uses the mechanism of ‘pipeline
politics’ to compensate for its loss of superpower status and to preserve
its zone of influence, particularly in the Caspian region and Central and
Eastern Europe (Müller-Kraenner 2008, pp. 47–56). The EU counterpart
is the suggestion that security of supply can be achieved through diversifi-
cation involving new pipelines circumventing Russian territory, Nabucco
providing the best known example. Youngs (2009) suggests that the EU
is in fact caught on the horns of a dilemma, between attempts to install
market-based governance of energy supplies and an essentially realist
approach to the geopolitics of pipelines. In the US, by contrast, new shale

gas discoveries over the last few years have – for now – made the country
virtually independent from imports. The situation is, of course, completely
different for oil supplies, even though the US, if it was minded to incur the
costs, could achieve a degree of autarchy in this sector too.
The uncertain future evoked by realist commentators is not merely
concerned with ‘above-ground’, political-economic factors, but intimately
bound up with the status of ‘below-ground’ energy reserves. While the
momentous increase in energy prices during 2004–2008 may have been
partly caused by the growing ‘financialization’ of energy markets and
an upsurge in speculation (Bradshaw 2010, p. 276), there is now a strong
chorus of voices pointing to underlying factors of supply and demand.
Data problems caused by failure to report or intentional misreporting
cannot conceal a general pattern of stagnant reserves (Owen et al. 2010).
The possibility of a significant future shortfall in oil supplies is supported
by a raft of additional arguments. First, significant additional demand
will come from emerging economies, especially India and China, and may
result in global energy demand growth of 36 percent by 2035, with demand
for oil projected to grow by 15 percent (IEA 2010). Second, considerable
investments will be needed to expand (or even maintain) supply because
there will be growing reliance on non-conventional, more expensive oils
from tar sands, enhanced oil recovery, or even coal liquefaction. Such
investments, however, will be hindered by short-term price volatility.
Third, even those countries with the capacity to ramp up produc-
tion of fossil fuels will struggle to increase exports. Many energy-rich
countries – for example Saudi Arabia, Iran, Venezuela – are dominated by
state-owned companies which frequently lack the capital or expertise to
substantially increase production. Moreover, substantial energy subsidies
have long been employed by these and other governments to reduce energy
poverty and secure the consent of their populations. Expectations of cheap
energy and a lack of interest in energy efficiency are now so entrenched in
most energy-rich countries that a continued rise in energy demand, which
could ultimately cancel out increased production, is entirely possible
(Rubin 2009).
Critics of such projections highlight a decade-long history of erroneous
predictions of scarcity. They argue that the supply of fossil fuels will be
ensured by technological change, which can unlock previously unprofit-
able reserves, and higher prices triggering increased investment and explo-
ration. At most, they acknowledge the potential for politically created
supply crises through increasing resource nationalism and insufficient
investment (Radetzki 2010). This riposte, however, is less forceful now
than in the past. Even the traditionally conservative IEA has accepted the
tenor of the end of ‘easy oil’ (Bradshaw 2010, p. 277) and conceded that

crude oil production will never again reach its ‘all-time peak’ of 2006 (IEA
2010, p. 48). Because this entails a switch to non-conventional oils and a
progressively lower ‘energy return on investment’, it is likely to contribute
to rising oil prices.
Besides oil supplies, the general picture for fossil fuels is even more con-
tested. Given recent technological advances in shale gas production and
underground coal gasification, it remains very uncertain when tangible
scarcities will materialize. With regard to oil, however, the significance
of the ‘peak oil’ thesis is that both materially and politically induced
supply shortages may well occur. The combined effect of uncertainty
and price volatility cements the high status of energy security on govern-
ments’ agendas because it suggests serious implications for economic
development and heightened international competition for scarcer energy
resources.
2.1 The Pursuit of Global Energy Security
Given the revitalized interest in energy issues, there is now a burgeoning

literature both on national and on global energy governance, including
the security dimension. In institutional terms, however, the idea of col-
lective energy security has only made very limited progress over the last
few decades. Continuing international discord is underpinned by the
fundamentally divergent interests of fossil-fuel exporting and import-
ing countries. For OPEC member states and other important exporters,
energy security is primarily a question of stable and predictable demand
from industrialized economies. The latter, on the other hand, created the
International Energy Agency (IEA) in 1974 to coordinate their response to
future oil crises and provide information and expertise for national energy
policy. For importing countries, energy security hence equates to security
of supply.
Although the fierce producer-consumer clashes of the 1970s are unlikely
to return, the bifurcated structure of energy security policy has proved
persistent. The establishment of the International Energy Forum (IEF)
in 1991 was intended to signal a new era. It provides a basis for enhanced
producer-consumer cooperation and already features initiatives on
improving the transparency of oil and gas data with regard to production
and investment levels. But a legacy of conflict and ‘deep-rooted mutual
suspicion’ has so far stood in the way of major governance breakthroughs
(Lesage et al. 2010, p. 62). The EU is a supporter of multilateralism but
the approach of its member states to energy security is often to secure a
network of bilateral deals with neighbours.
To bolster the case for global cooperation, commentators have

nderlined the high degree of interdependence (Yueh 2010) which typi-

u
fies global energy relations. In theoretical terms, this condition has long
applied in a globalising world. The drive towards an efficiently function-
ing global energy market (primarily for fossil fuels) is nothing less than an
institutionalization of economic interdependence. But in practical terms,
shared vulnerability was brought to the fore by surging energy prices
during 2004–2008. From 2005 onwards, several G-8 meetings treated
energy as a high priority and initiated a number of assessments and action
plans by drawing on the IEA’s expertise (Lesage et al. 2010, Ch. 7).
A minimal common ground between consumer and producer countries
is the avoidance of extreme price volatility because it makes planning for
the future exceedingly difficult. For example, the budgets of fossil fuel
exporting countries were initially buoyed by rising revenues, then shrank
suddenly when the financial crisis hit and prices collapsed. Given the
nature of energy policy, however, it is unlikely that UN institutions will
take the lead in this venture. Even though many UN organizations and
programmes also pursue energy-related activities, the envisaged central
organizational node, UN-Energy, is currently no more than an embry-
onic focal point. Therefore, in a ‘business-as-usual’ scenario of global
energy governance, serious coordination will remain the preserve of
‘coalitions of the willing’, while broader multilateral processes are most
likely to proceed through the UN climate change regime (UNFCCC)
(Karlsson-Vinkhuyzen 2010, p. 193). As we argue in the final section of
this chapter, this regulatory dynamic would likely increase the compat-
ibility of energy security and climate change mitigation. To substantiate
this point, however, we first turn towards the notion of climate security.
3 CLIMATE SECURITY
Climate security has its roots in the environmental security debate. The
critical questions raised and empirical results first offered in the early
1990s are equally valid for today’s discussions.2 Unsurprisingly, in theo-
retical terms the precise meaning of climate security therefore remains
contested. Understandings range from the adaptive capacity and resilience
of societies in the face of extreme weather events to ambitious mitigation
which reduces the risk of catastrophic consequences. Yet, in the realm
of international climate governance, political consensus has developed
around a precise number to distinguish ‘manageable’ from ‘dangerous’
climate change: this is the famous 2°C threshold. While the concept of
environmental security has long been present in discussions about envi-
ronmental governance, the related notion of climate security is a relative

ewcomer. This process of ‘securitization’ may be understood as a gradual

n
and mainly discursive accomplishment from a constructivist perspective or
as an inevitable and necessary development from a rationalist standpoint.
A constructivist approach would trace the rise of the climate security
discourse over the past few years. Some have pinpointed the year 2002
as the point at which the political mainstream acknowledged potential
security implications. According to Dupont (2008, p. 30), a report com-
missioned by the Pentagon (Schwartz and Randall 2003) helped trigger
a learning process through which climate change ‘metamorphosed from
a boutique environmental concern to a first-order foreign-policy and
national-security problem that is now being ranked alongside terrorism
and the proliferation of weapons of mass destruction.’ The following years
did indeed witness a flurry of similar, if more sophisticated, assessments,
most prominently a 2007 report by a US think tank (CNA Corporation),
a 2008 EU report on ‘Climate Change and International Security’, and an
explicit recognition by the 2010 US Quadrennial Defense Review and by
the 2010 UK Strategic Defence and Security Review.
Although there are still some doubts about the extent and durability of
the securitization process3 (Scott 2008; Mobjörk et al. 2010), the debate on
climate change and security in the UN Security Council (April 2007) may
come to be seen as a genuine watershed. While most developing countries
resisted the security framing and favoured environment/development
discourses, small-island developing states (SIDS) – ranking among the
most vulnerable nations – sided with industrialized countries to support
an active role for the Council in climate change governance (Detraz and
Betsill 2009, p. 312). In July 2011, Germany reintroduced the issue at the
Council. There was agreement on the significance of climate change, but
no consensus on the appropriate international forum for its discussion.
China and Russia, supported by G-77 members argued that the Council
was ill equipped to cover a topic that was the proper responsibility of
the UNFCCC (MacFarquhar 2011). Despite the session ending without
tangible results, these high-level diplomatic discussions have arguably
ensured the presence of climate security considerations on the agendas of
governments and international organizations.
A rationalist approach places greater emphasis on the expected impacts
of climate change and the likely gamut of security responses they are likely
to trigger. One of way of developing such predictive capacity is to construct
scenarios based on the best available climate science. Another is to study
historical instances in which climatic factors seem to have played a critical
role, for example the decline or collapse of ancient civilizations (Dupont
2008, p. 31). Quantitative methodologies can equally be applied. Lewis
(2009, p. 1199) thus cites a Chinese study concluding that 70–80 percent of

‘peak war activity’ in China’s history took place during unusually cold or
warm climatic periods which sharply reduced land productivity.
A combination of these analytical pathways holds insights for all major
strands of security thinking. For proponents of national security priori-
ties, climate change fits into the category of unconventional, destabilising
‘threat multipliers’ that could cause state failure, foment extremism,
trigger migratory waves, and physically endanger military installations
at home and abroad. This was the thrust of the 2008 paper developed,
with special emphasis on climate change and the Arctic, by the EU’s
Javier Solana (European Council 2008). For advocates of human security
approaches, climate change impacts pose grave challenges to the twin
objectives of ‘freedom from fear’ and ‘freedom from want’ by undermin-
ing stable livelihoods and imposing significant and costly adjustments on
frequently vulnerable communities.
Third, what marks out climate change from other non-conventional
security threats is its disruptive effect on ecological, ‘planetary’ security.
By adversely affecting the capacity of the atmosphere to render the ‘eco-
system service’ of providing a stable climatic system, rapid (and potentially
abrupt) human-induced climate change may pose an existential threat to
the biosphere, including human civilization itself. To use the terminology
of the Copenhagen School, what is evident here is a shift in the referent
object of security from the nation state, to the individual in society and
finally to the planetary biosphere itself.
3.1 Reactive Climate Security
The argument about fundamental ecological security and climate change

impacts has been implicit in the literature since the 1970s. But now that
attention to the security implications of climate change is growing, the
focus is often re-adjusted onto reactive policies, such as coping mecha-
nisms and adaptation measures. This strategic shift in policy formulation
is justified by two weighty arguments. First, the inertia of the climate
system implies that the current concentration of CO2 in the atmosphere
is already sufficient to generate a significant degree of global warming
over the coming decades. Second, the recognition of inevitable impacts is
joined by pragmatic motivations. As David Keith (2009, p. 56) describes it,
in contrast to globally coordinated mitigation measures, ‘the self-interest
of nations, firms and individuals will work to drive measures to ease
adaptation to the changing climate since the benefits of adaptation can be
captured locally where money is spent.’
Apart from positive results for human security, such benefits can
equally be understood as the avoidance of violent conflict. Certainly,

the causal connection between climate change and conflict remains

hotly contested. Yet, a broad-based, if minimal, consensus has emerged
around the proposition that violent conflict rests on numerous, complex
socio-economic and political – as well as climatic – processes and that the
latter may constitute a ‘non-essential’ causal factor (Mazo 2010, p. 40).
Among the expected consequences of climate change are sea-level rise,
altered precipitation patterns, an increase in extreme weather events,
melting glaciers, increasing burdens of infectious diseases, and the pro-
gressive acidification of the oceans (Dupont 2008, p. 32). When set against
a number of separate trends, such as population growth, it is evident that
climate change will contribute to increasing water and food insecurity
around the world.4 Whereas profound societal destabilization will not
necessarily translate into inter-state warfare, it will harm the prospects
for human well-being and may trigger unprecedented waves of migration,
both within and across national territories. Some estimates suggest there
may be 200 million environmental refugees by 2050 (Mazo 2010, p. 129).
Furthermore, failing states could unwittingly ‘export’ insecurity well
beyond their borders by becoming havens for international criminal or
terrorist networks.
If security responses to such instabilities were designed by traditional
military planners, one may expect the whole gamut of coping and contain-
ment tools to be applied. Individual states or alliances of states are likely to
step up border security and the policing of major migratory routes (Rogers
2010). The beginnings of these trends can, for instance be discerned in
the EU’s Immigration, and Neighbourhood Policies. Active intervention
in failed states, under the Common Security and Defence Policy, for the
purpose of conflict prevention, conflict resolution or humanitarian assist-
ance may also appear on the agenda alongside EU counter-terrorism
efforts. However, many of these measures may also strengthen the wide-
spread perception of an ‘uncaring West’. This could bolster support for
extremist groups5 and perhaps provoke radical civic mobilization within
developed countries themselves (Mabey 2008, p. 94).
On the other hand, reactive security responses need not be confined
to military approaches. Following a human security perspective, there
will also be increasing interest in emergency adaptation measures and,
crucially, in ‘pre-adaptation’ strategies such as fostering resilience and
‘climate-proofing’ of critical infrastructures (Adger 2010; Mazo 2010,
p. 102). Much of the climate aid for developing countries – projected to
reach $100 billion annually by 2020 – is likely to be earmarked for this cat-
egory of actions. Initial projects from late 2010, such as combating coastal
erosion in Senegal or flood prevention in northern Pakistan, give an indi-
cation of what resilience and ‘pre-adaptation’ mean in practice.

3.2 Preventive Climate Security
While few would dispute the need for reactive security policy and adap-
tation measures, the central question is whether these will compete with
the requirements of climate change mitigation. Given the slow progress
of international climate regulation, adaptation funding – one of the few
issues gathering widespread support – might well be employed for policies
that further increase carbon emissions. On the other hand, the accompa-
nying capacity-building may also serve to improve the effectiveness of
mitigation policies (Mazo 2010, p. 132). Overall, a broad consensus exists
that ‘sustainable security’ (Dalby 2009, p. 166) can only be achieved if both
policy objectives are designed for compatibility. The governance arrange-
ments for avoiding deforestation (REDD1), currently under discussion in
the UNFCCC and affiliated fora, represent a test case for this integrated
conception.
Regarding mitigation, ambitious reductions in greenhouse gas emis-
sions are essential not only to curb the need for risky and expensive reac-
tive security policies. Moreover, it is becoming increasingly clear that the
process of climate change may not conform to the linear assumptions
embodied by relatively conservative modelling exercises. Although the
IPCC’s Fourth Assessment Report states that climate change is very likely
caused by human activity (IPCC 2007), detailed knowledge about the
precise mechanisms of an enormously complex climatic system remains a
work in progress. This is reflected by the broad ranges of possible temper-
ature change given in the IPCC’s scenarios. Rather than taking scientific
uncertainty as a reason for hesitation, however, many commentators have
pointed out that the probability functions of mainstream climate models
could be too linear because the climate’s sensitivity to GHGs might unex-
pectedly turn out to be much stronger. Recent developments – such as
unprecedented reductions in mid-year Arctic sea ice in 2010 and 2012,
sustained sea-level rises, and higher GHG emissions than projected – have
bolstered these concerns (Mobjörk et al. 2010, p. 42ff.).
Unexpectedly rapid or strong climatic changes are not the only scien-
tifically grounded scenarios that would likely have severe security conse-
quences. It is equally possible that there are non-linear climatic dynamics
scientists do not yet understand and which therefore cannot be integrated
into their models. There are likely to be thresholds or ‘tipping points’
which could shift the global or, more likely, regional climate system into
a new state. Mabey (2008, p. 22) presents a typology of such climatic
events, distinguishing between ‘high impact reversible events’ (e.g. chang-
ing Asian monsoons, a weakening Gulf Stream), ‘irreversible impacts’
(e.g. melting glaciers, species extinction), and ‘runaway climate change’

whereby feedback loops – triggered by events such as melting permafrost

soils releasing large quantities of methane – would push the climate system
into an uncontrollable warming spiral.
Such ‘high impact/low probability’ scenarios are no mere figment of
imagination, as the geological record shows that they have occurred in
the distant past (Mabey 2008, p. 13; Mazo 2010, p. 29). These scenarios
are now frequently recognized in the scientific and policy literatures.
Innovative economic analysis has equally cast doubt on conservative
‘median’ damage functions commonly employed by mainstream ‘gradual-
ism’. Weitzman (2010, p. 24) thus proposes a ‘fat-tailed’ probability dis-
tribution of climate sensitivity to higher greenhouse gas concentrations.
This implies a distinct chance (1 percent) of 10 or more degrees of global
warming and suggests that ambitious mitigation targets would represent
an insurance policy against catastrophic climate change.
Discourses of preventive security strike a similar note. The core argu-
ment here is that security analysts and military planners have been
trained to rely on prudence and foresight which may lead them to con-
sider worst-case scenarios rather than mere ‘best guesses’ (Dupont 2008;
Mabey 2008; Rogers 2010). By implementing this form of assessment,
analysts may come to recognize that reactive security responses cannot
adequately deal with scenarios of extreme or abrupt climate change. First,
every society has a limited adaptive capacity to profound perturbations.
Second, as Mabey (2008, p. 13) puts it, ‘while climate change raises many
hard security problems, it [ultimately] has no hard security solutions.’ In
policy terms, both preventive security and risk-averse economic thinking
point towards two major undertakings: a rapid transition towards an
ultra-low carbon economy and enhanced international cooperation on
climate governance.
4 GOVERNING ENERGY AND CLIMATE

SECURITY
The first two parts of this chapter have come to different conclusions
regarding the challenges of energy security and climate security. For the
former, strong international governance mechanisms are desirable but
difficult; for the latter, such advances are very challenging indeed, but ulti-
mately indispensable. Energy security is largely subject to the vagaries of
the market and the geo-political manoeuvres of major producers and con-
sumers. Institutions such as the International Energy Agency, set up in 1974
by OECD countries, or agreements such as the EU-sponsored 1991 Energy
Charter Treaty have not been able to fundamentally change this dynamic.

A range of existing governance mechanisms have extended their remit

to cover climate change – typically viewed as a ‘threat multiplier’. They
provide numerous frameworks for collaborative international efforts to
react to the effects of climate change. The climate issue has permeated the
international institutional architecture from development organizations
interested in adaptation to UN peacekeeping and the EU’s Common
Security and Defence Policy. Those who oppose a modification of the
UN Security Council’s activities prefer to keep the Climate Change
Convention as the appropriate forum and to assert that climate security
must be considered as a sustainable development issue. Despite recent
growing concern with adaptation, the UNFCCC, therefore, remains
the institutional location for efforts at preventive climate governance.
Although hailed as a success, the Durban 2011 CoP extended the date for
a comprehensive new agreement out to 2020. Given this delay and con-
tinuing uncertainty about the eventual agreement, many major economies
have resolved to enact domestic climate and energy policies that pursue
‘win-win’ solutions, such as fuel-switching to low- and ultra-low-carbon
sources, greater energy efficiency, demand reduction, and the develop-
ment of cost-efficient carbon capture and storage (CCS) technology
(Froggatt and Levi 2009).
4.1 ‘Synergistic’ Climate and Energy Security Policy
The popularity of ‘synergistic’ approaches is reflected in policy devel-

opments in major economies around the world. For instance, emerg-
ing economies such as China and India continue to pursue traditional
energy policy centred on diversification of energy sources, expansion of
fossil-fuel-based energy generation, and the reduction of energy poverty.
But they are also implementing ‘win-win’ energy-and-climate policies.
With Chinese oil imports predicted to rise from about half to well over
80 percent of domestic needs by 2030 (IEA 2007a), a target of reducing the
energy intensity of its economy by 20 percent until 2010 has been raised
to 40–45 percent by 2020. This goal is to be achieved primarily through
energy efficiency measures, but is flanked by an ambitious programme of
investment in low-carbon energy generation which might lead to renew-
able energy providing one third of total energy generation by 2020. India
is projected to face an even greater degree of energy dependence, with up
to 90 percent of oil and a rapidly growing share of natural gas and coal to
be imported by 2030 (IEA 2007b). India’s 2008 ‘National Action Plan on
Climate Change’ emphasizes significant future investments in solar energy
and energy efficiency.
Even a high-income country such as the US has until now followed a

similar policy pattern. US energy and climate policy has often depended
on traditional notions of energy security emphasising domestic produc-
tion of oil and gas. Yet, a temporary confluence with supporters of climate
change mitigation brought about the 2007 ‘Energy Independence and
Security Act’ which yielded policies on biofuels,6 energy efficiency and
low-carbon energy generation (Bang 2010). However, there are some
mid-and high-income countries which have committed to more ambitious
and target-based action on climate mitigation. Mexico, for example, plans
to reduce its GHG emissions by 30 percent below a business-as-usual sce-
nario by 2020 and 50 percent from 2000 levels by 2050. Japan has pledged
to reduce its emissions in the same period by 25 percent below 1990 levels,
although this target will be difficult to achieve. And the EU proposed a
20–30 percent cut below 1990 levels, but made the upper figure conditional
on stronger international reciprocity.7 If current policies on renewable
energy and energy efficiency are fully implemented, the EU might achieve
a 30 percent reduction by 2030, but that still leaves a considerable gap to
the long-term objective of cutting GHG emissions by 80 percent until 2050
(European Commission 2011).
By extrapolating from intra-European differences, one can try to deduce
the main reasons behind the divergent ambitions of these two groups of
countries. Marques et al. (2010) thus found that investment in renewable
energy sources increased in line with an EU member state’s dependence on
energy imports. Unlike the US, most European states – as well as Japan
and Mexico – do not currently have the option of expanding domestic
production of fossil fuels in a cost-effective manner. The EU as a whole is
projected to see its total import dependency increase from 82.6 percent for
crude oil and 60.3 percent for natural gas (in 2007) to around 93 percent
and over 80 percent by 2030 (Comolli 2010). In the wake of the 2005–2006
Russia-Ukraine dispute over natural gas deliveries, political momentum
resulted in the 2008 ‘EU Climate and Energy Package’. The Commission
has taken a synergistic view:
Action on renewables and energy efficiency, besides tackling climate change,

will contribute to security of energy supply and help limit the EU’s growing
dependence on imported energy. It could also create many high-quality jobs in
Europe and maintain Europe’s technological leadership in a rapidly growing
global sector. (European Commission 2006, p. 10)
This is matched by calls for cooperation with other players US, China,
India, Canada and Japan on energy efficiency and renewables, global
market access and investment trends to achieve better results in multilat-
eral fora such as the UN, the IEA and the G-8. ‘If these countries reduce
the use of fossil fuels, it will also be beneficial for Europe’s energy security’

(European Commission 2006, pp. 16–17). ‘Indeed energy must become

a central part of all EU external relations; it is crucial to geopolitical
security, economic stability, social development and international efforts
to combat climate change’ (European Commission 2007, p. 17). Existing
momentum for climate policy was fuelled by newly salient energy security
concerns which, in turn, were stoked by a more prolonged Russia-Ukraine
gas dispute in January 2009 which caused severe gas shortages in several
EU member states. An emerging European energy strategy focuses on
investments in the diversification of import sources (e.g. alternative gas
pipelines), the creation of a common internal energy market and exploit-
ing untapped potential for energy efficiencies (European Commission
2010). Although significant potential for synergies remains, energy secu-
rity considerations have by now largely replaced climate policy objectives
as the main driver of regulatory evolution.
How do these various policies fare when compared with the overarching
objectives of energy and climate security? The cautious energy-and-climate
policy packages enacted by China, India, and the US score highly on
affordability and reliability, while the latter economies benefit from
enhanced security of access. Moreover, in the longer run, if predictions
of rising energy prices come true, first-movers in energy efficiency and
‘decarbonization’ will reap substantial benefits: they will have already
reduced their consumption of oil and thus improved their economic
competitiveness.
In terms of preventive climate security, however, most policies are still
inadequate. Although the US intends to cut GHG emissions by 17 percent
between 2005 and 2020, the US Energy Information Administration (EIA)
estimates that energy-related carbon emissions will grow by 0.2 percent
annually until 2035 (EIA 2010, p. 128). In both China and India, domestic
(carbon-heavy) coal will continue to play a dominant role in energy gen-
eration. EIA figures predict annual growth rates in energy-related carbon
emissions of 2.7 percent (China) and 1.8 percent (India). By contrast, the
EIA expects an annual reduction in energy-related carbon emissions in
OECD-Europe and Japan by 0.2 percent and 0.6 percent respectively.
Collectively, the climate and energy policies announced by major econo-
mies imply very limited progress on climate mitigation and in many other
developing or emerging economies, the carbon intensity of power genera-
tion has in fact continued to rise (Tandon 2012). In November 2010, the
UN Environment Programme calculated that targets and other pledges
by major economies only amount to 60 percent of the GHG reductions
needed to stay below the 2°C threshold.8

5 CONCLUSION: THE GOVERNANCE DILEMMA
According to the then EU Energy Commissioner, ‘climate change and

energy security are two sides of the same coin. The same remedies must
be applied to both problems’ (Piebalgs 2009, p. 2). There is certainly a
conceptual overlap between energy and climate security. Not only are
they both, to various degrees, concerned with the transition away from
a carbon-heavy, fossil-fuel based global economy. They also have to
confront fundamental scarcities: the scarcity of affordable and readily
accessible fossil energy or the scarcity of atmospheric ‘carbon space’. Both
the energy and the climate challenge can therefore benefit from demand
reduction as well as from supply-side measures which diminish both types
of scarcity, such as low-carbon energy technologies. There is no denying
the underlying attraction of this proposition and the way in which a ‘syn-
ergistic’ approach provides what must be the ultimate ‘win-win’ solution
neatly addressing energy and climate security concerns through a move to
a decarbonized economy.
The problem is, of course, making the political fit between climate and
energy security. The orthodox vision of enhanced global energy security,
grounded in economic globalization and increasing interdependence, still
depends on a compromise between producers and consumers of fossil
fuels. The sole likely benefit for climate governance would be reduced
price volatility and hence greater predictability for alternative energy
investments. Overall, strategies prioritising either national or global
energy security are likely to result in incremental climate policy and a
resort to reactive climate security. For such an approach the referent
object will continue to be the state.
Furthermore, while the various benefits of energy security measures
can be captured at the national or even regional-or EU-level and are not
necessarily dependent upon international cooperation, the public good of
climatic stability can only be attained by concerted efforts at the global
level. This is because the global atmosphere can be regarded as having the
characteristics of a commons. Climatic security defined in terms of stabil-
ity is frequently understood as non-rival and non-excludable public good.
It requires collective mitigation efforts amongst the largest emitters and
mechanisms to ensure compliance and avoid ‘free-riding’. The atmosphere
also represents a finite ‘common sink’ for GHG emissions. Most current
economic activities constitute a rival consumption of ‘carbon space’.
And strict international targets would partially enclose or ‘privatize’ this
resource in order to limit ruinous over-consumption. However, the very
notion of carbon space, which has become in recent years a key negotiat-
ing concept for some developing countries, illustrates the extent of the

problem of arriving at an effective agreement beyond the first commitment

period of the Kyoto Protocol.9 The point here is that much of the world’s
limited carbon space has already been occupied by the industrialized
countries and that justice demands that the remainder be used to realize
the development objectives of the South. In the climate negotiations from
Copenhagen (2009) to Durban (2011), the objective of the key players has
been to avoid being trapped in an agreement that might imperil short-run
national energy security.
The widespread preference for incremental policy reform signifies that
national energy security will continue to be a ‘far stronger policy driver’
(Froggatt and Levi 2009, p. 1141) than climate security. Regardless of the
progress made through synergistic measures, this ‘gradualism’ contains
considerable structural bias. First, it permits the ‘lock-in’ of fossil- or
biofuel-intensive infrastructures, which has important consequences for
emission trajectories in rapidly industrialising countries. Second, it relies
on domestic ‘win-win’ policy scenarios which – similar to local benefits
derived from climate adaptation measures – favour outcomes consistent
with reactive climate security. Furthermore, integrated global or regional
markets for fossil fuels imply that national energy-and-climate policies
result in ‘carbon leakage’ by lowering global/regional energy prices and
stimulating energy demand elsewhere.
A different set of national and international policies would be required
if governments were to pursue preventive climate security in earnest. At
the national level, energy and climate policy would prioritize longer-term
objectives – security of supply, greater foreign policy autonomy and
ultra-low carbon emissions – without wholly ignoring short-term consid-
erations of affordability, reliability, and political feasibility (Compston
2010). There are formidable difficulties here, where developed country
governments need to overcome the incentives to operate on a short-term
basis and to work with public opinion.
In terms of the latter there are mixed messages. For the European
Union, ‘[a]n EU level solution to the climate problem has served as a con-
vincing narrative to persuade EU citizens that there is a need to continue
the process of European integration’ (Adelle and Withana 2010, p. 331).
There are also significant similarities in attitudes in the EU, the US, and
other advanced countries. These include concern about climate change
laced with some scepticism about the science and an unwillingness to make
personally costly changes with the requirements of economic growth being
placed above climate protection. While there is support for renewables in
general, significant opposition exists to particular technologies such as
wind farms (ibid., p. 327). One key difference which may help to explain
divergence between EU and US policy and which is hardly merited by

their respective situations is that ‘energy security is considered a much

more important factor in the US than in EU and is given greater prior-
ity than environmental protection by a significant number of Americans’
(ibid., p. 329). Thus, ‘for governments faced with tough policy choices, the
public’s reluctance to accept costly policy choices could limit the use and
range of policy solutions in the transition to a low-carbon economy’ (ibid.,
p. 328). Amongst the BASIC countries the demands facing policy-makers
are bound to be more extreme, with energy priorities for development
dominating other concerns and indeed being fundamental to the continu-
ing legitimacy of governments.
There is also the question of the interaction between national and inter-
national climate and energy policies. Is it possible that international com-
mitments could provide momentum for domestic policy reform? There
is some evidence that the search for short-term national energy security
does not always prevail and that international norms and commitments
can have a significant effect, especially if the prestige and credibility of
governments is engaged. The adoption of the Emissions Trading Scheme
by the EU provides a case in point. This particular ‘flexibility mechanism’
had been opposed prior to Kyoto but became the bedrock of the Union’s
approach to climate, driven like the ‘burden sharing’ agreement before
it by the requirements to maintain its leading position at the interna-
tional level. The evidence is not as strong, but Chinese and Indian policy
changes, involving the announcement of energy efficiency targets, were
certainly stimulated by the need to generate a credible position in advance
of the 2009 Copenhagen CoP. It remains the case, however, that more
often than not energy security drives climate policy, although the result
may not always be negative. In this regard the EU’s 2006 gas crisis was one
of the incentives to agree the 2008 ‘Climate and Energy Package’ that pro-
vided the policy basis for the implementation of the Union’s 20/30 percent
emissions reduction commitment.
If global climatic stability became an actual policy priority, it would not
only deliver important ‘co-benefits’ for global energy security, but would
also provide a genuine basis for implementing a preventive climate security
strategy. To dilute both domestic and international obstacles to ambitious
climate policy, advanced industrialized countries would have to engineer
an ‘energy revolution’ – through enormous investments, technology trans-
fer, and capacity-building in developing countries. The necessary coali-
tions would have to be forged among major energy-consuming countries
and not rely on older practices of producer-consumer conciliation (Mabey
2008, p. 68).
Energy and climate are thus not only materially intertwined, but also
interdependent politically. Without increased availability of practical

and affordable energy technologies to enable climate-friendly economic

development, international climate governance will not progress substan-
tially. What the public goods analysis makes clear is that the regulatory
‘direction of travel’ should still lead from climate to energy – rather than
vice versa – because only this arrangement could ensure that long-term
strategic foresight prevails over short-term pragmatism.
NOTES
1. The substantial literature on environmental security was stimulated in particular by the

ending of the Cold War. In general, it attempts to tease out the relationship between
environmental degradation and conflict as in the extensive work of Homer-Dixon
(1994). Deudney and Mathews (1999) explore some of problems of securitizing the
environment.
2. For an excellent survey of different IR perspectives on climate security during this
period, see Stripple (2002).
3. The reference here is of course to the Copenhagen School (Buzan et al. 1998). To some
extent, this process of ‘securitization’ amplifies ideas proposed in the 1970s when natural
resources and the environment were first recognized as security issues. In this sense,
energy security and climate security, the core issues of this article, have merely been
recast as critical components of security thinking in the twenty-first century.
4. The 2011 Climate Change Vulnerability Index by the British consultancy Maplecroft
rates 16 countries as being at ‘extreme risk’, with Bangladesh, India and Madagascar
among the top three.
5. Several southern diplomats have already described climate change as an ‘act of aggres-
sion’ and even extremist groups such as al-Qaeda have specifically referred to Western
responsibility for climate change and the US refusal to sign the Kyoto Protocol (Scott
2008, p. 607; Mazo 2010, p. 129).
6. US biofuels such as corn-based ethanol, however, have been accused of producing higher
GHG emissions than imported oil.
7. A significant proportion of Japanese and European emission reductions will likely be
achieved by international offset procedures such as the Clean Development Mechanism.
8. See the UNEP Emissions Gap Report at www.unep.org/publications/ebooks/emission-
sgapreport (accessed 21 February 2013). The outcomes of the 2010 Cancún and 2011
Durban climate change conferences have not altered the validity of these calculations.
9. ‘Carbon space’ is a special case of the more general concept of ‘environmental utilization
space’ (Opschoor 1995). Calculated on a historical basis, it has become part of the negoti-
ating position of India China and the BASIC group at international climate conferences
(see Tata Institute of Social Sciences 2010). Calculations are made on a national basis,
but it would be equally possible to arrive at a different outcome on the basis of individual
carbon entitlements.
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15. Energy, climate change and conflict:
securitization of migration, mitigation
and geoengineering
Jürgen Scheffran*
INTRODUCTION: FROM ENERGY SECURITY TO

CLIMATE CONFLICTS
In many of the world’s conflicts energy resources have been an influential
factor (Singer 2008; Singer and Scheffran 2004). This is partly due to the
dual nature of energy: while energy use is important for human life and
society, a precondition for social development and economic prosperity,
it may also cause risk, destruction and death. Physical power from energy
can be converted into political power, and physical force is a tool used in
violent acts. Traditionally, energy security has been framed in terms of
ensured access to energy resources to meet political and economic goals,
while the lack of energy is perceived as a security threat. Security risks and
conflicts can also result from the use and misuse of energy, its side-effects
and unbalanced distribution. In turn, violent conflicts and social disrup-
tion impede access to energy resources. Each component of the energy
system can become a target of attack or resistance by state and non-state
actors, including dams, reactors and power grids. On the other hand,
energy use as well as the prevention of risks and conflicts is a field for
international cooperation and global security.
Energy security strongly depends on its geographical and geopolitical
context. The components of the fossil-nuclear energy system – coal, oil
and natural gas reserves, uranium mines as well as the connecting infra-
structures, networks and transportation routes – have shaped the global
conflict landscape in the past century (Yergin 1991, 2011). Geopolitical
conflict lines may become sharper with growing energy demand, dimin-
ishing fossil fuel reserves, uneven distribution of energy resources and
increasing North-South imbalances. Fossil energy use also affects the
environment in many parts of the world. While most of these impacts are
local or regional, global warming caused by greenhouse gas (GHG) emis-
sions raises concerns about global security risks which are interconnected
with regional and local conflict constellations.
Numerous studies have raised questions about the security risks and
319

conflict potentials of climate change. Increasingly, strategies to counter

and respond to climate change become subject to conflict themselves.
When people migrate to evade the impacts of climate change, this could
provoke security issues and conflicts in the regions or origin and destina-
tion. Mitigation and adaptation require substantial political and societal
interventions that could provoke concerns and resistance (Scheffran and
Cannaday 2013). While nuclear energy as a low-carbon technology poses
a range of safety and security issues, with renewable energy geopolitical
interests are shifting to the regional and local scale, giving more relevance
to land use and the community level. In the emerging new energy land-
scapes conflict lines tend to be inner-societal but may reach national and
international levels since they are interconnected through global markets,
global warming and global governance. This may be even more the case
when geoengineering techniques are developed to intentionally design a
global climate system which could become a new field of international
security and conflict (Brzoska et al. 2012).
Expanding these issues, the focus of this chapter is the potential security
risks and conflict constellations of climate change as well as climate poli-
cies. This provides a basis for an assessment and comparison of human
and societal responses to climate change, including migration, mitigation
and geoengineering, which are analyzed in terms of narratives, empirical
findings, critical perspectives and strategies. This integrated approach
adds a new dimension to the discourses on the securitization of energy and
climate change.
CLIMATE CHANGE AS A SECURITY AND

CONFLICT ISSUE
Securitization of the Climate Change Discourse
Developed by the Copenhagen school (Wæver 1995, 1997; Buzan et al.

1998), the “securitization theory” offers a conceptual framework for the
analysis of policy declarations (“speech acts”) on the security implications
of climate change. By declaring a development an existential threat, an
actor turns this into a security issue that requires utmost priority and the
use of extraordinary measures to respond to this threat. Securitization
moves could be enacted by governmental representatives as well as by
non-state actors. According to Buzan et al. (1998: 26) a successful secu-
ritization “has three components: existential threats, emergency action,
and effects on interunit relations by breaking free of rules.” To address the
security challenges, extraordinary responses are considered, such as the

Securitization of migration, mitigation and geoengineering 321
use of violence or military and police actions, which lead to social interac-
tions and conflicts, such as interstate war or civil war.
Critical assessments have pointed to several shortcomings of the
securitization approach: its emphasis on “subjective” perceptions and
“exceptional” measures, the focus on security experts and their often
realist thinking, the Eurocentric focus of its research agenda (Bigo 2002;
Methmann and Rothe 2012; Oels 2012). The relevance of securitization in
the environmental field has been controversially debated. The conceptu-
alization of environmental security emerged in the aftermath of the Cold
War and was initially shaped by the discourse on environmental conflicts
(Trombetta 2008, 2012). Several research projects assessed the linkages
between environmental degradation, resource scarcity and violent con-
flict, based on qualitative regional case studies (Homer-Dixon 1991, 1994;
Bächler and Spillmann 1996). In this period global warming remained
largely an environmental issue while its security implications played only a
marginal role, besides some political statements that used security-related
language to express the dramatic consequences of climate change. Research
efforts on the climate-security nexus were scattered until the end of the
1990s (e.g. Gleick 1989; Swart 1996; Scheffran 1997; Rahman 1999). In
the past decade the issue gained ground by an increasing number of assess-
ments (for an overview of the early literature see Brauch 2009).
The year 2007 became a turning point in the securitization of climate
change. In its Fourth Assessment Report the Intergovernmental Panel
on Climate Change (IPCC) addressed the risks of climate change, but not
security and conflict issues. After its publication the public discourse on
climate change intensified and increasingly focused on security dimensions
(see Brauch 2009; Brzoska 2009, 2012; Scheffran and Battaglini 2011).
Major agents in the securitization of climate change are those who project
security threats or suggest actions to address them. A number of studies
have investigated the potential security implications of climate change,
involving researchers, consultants, think tanks, media, non-governmental
organizations, national governments, as well as international organiza-
tions, institutions and regimes.
To give a few example cases, a US-based panel of experts has portrayed
global warming as “one of the greatest national security challenges” that
could breed new threats and conflicts (Campbell et al. 2007). A military
think tank has characterized climate change as a “threat multiplier” that
could heighten global tensions in fragile regions of the world (CNA 2007).
The German Advisory Council on Global Environmental Change is con-
cerned that without an effective climate policy the consequences “could
well trigger national and international distributional conflicts and inten-
sify problems already hard to manage such as state failure, the erosion

of social order, and rising violence.”(WBGU 2008) A recent study by a

research unit of the German Federal Armed Forces points to the signifi-
cant destabilization potential of climate change for states and societies, in
particular when they have low problem solving capacity (resilience) to
address climate impacts (Bundeswehr 2012).
On the European level, the EU High Representative and the European
Commission suggested in 2008 that “climate change acts as a threat mul-
tiplier, worsening existing tensions in countries and regions which are
already fragile and conflict-prone” (EU 2008). At the United Nations
level, divergent perspectives became visible between developed and
developing countries when the UN Security Council (UNSC) discussed
the security risks of climate change in 2007 and 2011. Initiated by
Great Britain, on April 17, 2007, the UNSC for the first time consid-
ered climate change as a security issue. On July 20, 2011 a statement
of the UNSC – under German presidency – raised concerns regarding
the threats posed by climate change to international peace and security
(UNSC 2011). While a coalition of OECD countries and Pacific Small
Island States stressed the need to address these threats in the UNSC,
Russia, China and many G-77 states refused to a mandate of the UNSC
for climate change (UNSC 2011). In 2009, the UN Secretary-General
provided a report on the security implications of climate change (UNSG
2009), indicating that internationally climate change has reached highest
levels.
Security Risks, Pathways and Agents
Assessments on the climate-security nexus differ regarding specific

methods, interests, pathways and responses as well as affected regions
and countries. They use similar narratives, storylines and speech acts that
are summarized here in a generalized way. Usually they combine natural
and social processes as drivers of security risks and conflicts. Global tem-
perature rise has multiple physical consequences that alter natural proc-
esses and cycles, such as ice formation, ocean currents, soil conditions,
precipitation and water distribution, ecological systems and biodiversity.
Potential effects of these changes are extreme weather events (droughts,
storms, floods), glacier melting and sea-level rise, biodiversity loss and
spreading diseases. The environmental impacts affect various dimensions
important for human livelihood, well-being and survival, including water
resources, agriculture and forestry, human health and settlements, energy
and economic systems. The impact of climate change on human beings
and social systems is affected by their vulnerability which is a function of
the “character, magnitude, and rate of climate change and variation to

which a system is exposed, its sensitivity, and its adaptive capacity” (IPCC
2007: 21). Most vulnerable are poor communities in high-risk areas and
developing countries which depend on agriculture and ecosystems services
sensitive to climate stress. The stronger the climate exposure and the larger
the affected region the more challenging it becomes for societies to absorb
and adapt to the impacts. In highly vulnerable regions with low adaptive
capacity, the impacts of climate change could turn into major security
risks.
In estimating the security implications, the assessments use different
security conceptions: national and international security at the level of
nation states; global security on a planetary scale; environmental secu-
rity for ecosystems and natural resources; human security for human life
and wellbeing. It is widely argued that global warming acts as a “threat
multiplier” that heightens global tensions in fragile regions of the world.
Human responses to the security challenges of climate change and the
resulting forms of social interaction have also raised security concerns.
These include human displacement, the use of violence and military
actions in conflict, as well as low-level forms of conflict such as protests,
riots, rebellions, or extreme forms of violence such as genocide. Altogether
it is concluded that the security risks and conflicts associated with climate
change could undermine societal stability.
Going beyond generalized statements, climate change is supposed to
affect security and conflict along multiple pathways. Among the major
“conflict constellations” are the degradation of freshwater resources,
the decline in food production, increasing storm and flood disasters,
and environmentally-induced migration (WBGU 2008). Other pathways
include sea-level rise, energy insecurity, deforestation, loss of biodiversity
and fishery. Acting as a threat multiplier, climate change may interfere in
complex ways with political, economic and social conflict factors, such
as population growth, increased demand and unequal distribution of
resources, or lacking political legitimacy of governments. For instance,
due to water scarcity and soil degradation agricultural yields could drop,
diminishing food supply and driving migration. Extreme weather events
put the economic infrastructure at risk, including industrial sites and
production facilities as well as networks for transportation and supply of
goods.
For all these concerns there is a range of uncertainties leaving room
for worst-case scenarios which are framing the discourse over potential
climate impacts. Affecting societies in complex ways, there is a range of
threatening narratives, including economic damage and risk to coastal
cities and critical infrastructure; loss of territory, border disputes and
environmentally-induced migration; resource conflicts and tension over

energy supply. Some regional hot spots are seen as more fragile and vul-
nerable due to their geographic and socio-economic conditions and the
lack of adaptation capabilities. As most vulnerable to climate change
appear people living in poverty, fragile states with poor governance and
conflict-prone societies where living conditions are already precarious.
Exposed to these risks, “failing states” have inadequate management and
problem solving capacities and cannot guarantee the core functions of
government, including law, public order and the monopoly on the use of
force. Although industrialized countries will be also exposed to climate
stress, they are usually less susceptible and have better capacities to cope
with the challenge.
Among the geographically-specific impacts are water scarcity, droughts
and heat waves in Southern Europe, Northern Africa, the Sahel and
the Middle East; floods and storms in Southern/Eastern Asia and the
American Gulf region; glacier melting in the polar regions, the Himalaya
and Andes mountains; sea-level rise on many of the world’s coasts; biodi-
versity loss in various ecosystems, in particular in tropical forests, moun-
tain regions and coral reefs (see WBGU 2008; Scheffran and Battaglini
2011, Scheffran et al. 2012a). In the worst-affected regions, climate change
could spread to neighbouring states, e.g. through refugee flows, ethnic
links, environmental resource flows or arms exports. Food insecurity in
one country may increase competition for resources and force population
to migrate into neighboring countries. Such spillover effects can expand
the geographical extent of a crisis and intensify the erosion of social
stability elsewhere.
A cycle of environmental degradation, economic decline, social unrest
and political instability could destabilize the affected societies. When
tipping points are reached, abrupt changes and cascading sequences
in the climate system could have incalculable consequences. Examples
are the potential loss of the Amazon rainforest, a shift in the Asian
monsoon, the disintegration of the Greenland and West-Antarctic ice
sheets, methane outburst from soils in Siberia or Canada, or the shutdown
of the North atlantic circulation (Lenton et al. 2008). Worst-case scenarios
may exceed adaptive capacities even in the most wealthy countries. The
difficulty to protect against extreme weather events has been demonstrated
by the 2003 heat wave in Europe which cost tens of thousands of human
lives, and by Hurricane Katrina in the US in 2005 which caused record
damages. Recent years have seen an increase in the frequency of such
events, to mention the severe drought in the US Midwest or Hurricane
Sandy on the US east coast in 2012.

Empirical Findings on Climate Change and Violent Conflict
While policy-oriented statements make strong claims about the secu-

rity implications of climate change, one question is how valid the
underlying assumptions and perceptions are. Quantitative studies and
data-bases provide empirical material together with statistical analysis to
test hypotheses about relations between climatic variables (temperature,
precipitation) and conflict-related variables (number of armed conflicts or
casualties). The research literature reaches mixed evidence and differing
conclusions on the causal relationship between climate change and violent
conflict (for an overview see Gleditsch 2012; Scheffran et al. 2012b,d).
Studies over long historical periods tend to find a correlation between
climate variability and armed conflict. One study concludes that cooler
periods in pre-industrial Europe are more likely related to periods of
violence than warmer phases (Tol and Wagner 2010). Similar results have
been found for the Northern Hemisphere and Eastern China (Zhang et
al. 2007, 2011). However, for recent periods empirical findings are more
diverse. After the end of the Cold War the number of armed conflicts has
declined, while temperature has increased. A significant linkage between
temperature, precipitation and African civil wars has been found for the
period 1981 to 2002 (Burke et al. 2009), a result that was challenged for
alternative model specifications (Buhaug 2010). A statistical analysis of
the El Niño Southern Oscillation (ENSO) for the period 1950–2004, con-
cludes that the “probability of new civil conflicts arising throughout the
tropics doubles during El Niño years relative to La Niña years” (Hsiang
et al. 2011). Yet, key questions remain on the connection between climate
change and the El Niño phenomenon. A more recent analysis of climate
variability and conflict risk in East Africa for 1990–2009, involving geo-
graphical factors, finds mixed results about the impact of precipitation
and temperature on violent conflict (O’Loughlin et al. 2012).
Explanations of the mixed empirical evidence point to the lack of
adequate data. It is supposed that climate change affects armed conflicts
between states less likely than low-level conflicts between societal groups
which are harder to measure. In addition, future climate change may be
much stronger than in the past for which data are available. To address
and overcome methodological deficits, databases are being expanded,
including low level violent events of non-state actors (such as riots).
Geo-referencing of these events (as used in the mentioned study on East
Africa) allows to represent spatio-temporal patterns of social interac-
tion. In addition to large-N statistical methodologies researchers explore
case studies, systematic assessments and modelling tools to analyze the
complex pathways between climate change and violent conflict and

c onsider human and societal responses. For some of the pathways the
empirical findings are summarized in the following (Scheffran et al 2012d):
1. Precipitation changes and variability: strong deviations from average

precipitation are related to violent conflict. In some regions (e.g. in
Kenya) conflict on rain-fed agriculture or pastoralism is more likely
in rainy than in dry seasons. More significant than environmental
factors are political and economic marginalization.
2. Freshwater resources and scarcity: international river systems are more
associated with low-level conflicts and diplomatic tensions than with
full-scale wars. Violent conflict is outweighed by the number of inter-
national water agreements.
3. Land and food: climate change is likely to contribute to food insecu-
rity, while food insecurity can contribute to conflict. In many coun-
tries, “food riots” were correlated with rising food prices between
2007 and 2011. Although frequently suggested, there is little empirical
evidence yet of a strong link between climate change and food-related
conflicts. Climate change plays an ambivalent role in conflicts among
pastoralists and farmers.
4. Weather extremes and natural disasters: natural disasters could desta-
bilize societies with weak economies, mixed political regimes and
pre-existing conflicts. There are weak links to armed conflict, while
disaster management is often a field of cooperation.
5. Environmental migration: there is a wide range of estimates on
environmental or climate induced migrants and whether these will
increase the likelihood of violent conflict. However, the empirical
justification is weak. Recent studies suggest to consider migration as
an adaptive response to climate change and develop the capabilities of
migrant networks.
While empirical evidence has been mixed so far, with growing future
climate change the various pathways to conflict could be intensified and
combined.
Critical Perspectives on Climate Securitization
Contrary to many speech acts on climate-related security and conflict

issues, the securitization of this policy field has met substantial criticism.
In addition to the weak empirical evidence regarding the climate-conflict
linkage, there have been no indications yet of “extraordinary measures”
in response to climate change. While many countries mention climate
change in their national security strategies as a potential threat, only a few

governments treat it as an imminent threat or a possible source of violent

conflict that justifies urgent actions in the security sector, with the excep-
tion of disaster preparedness (Brzoska 2012). Accordingly, some research-
ers conclude that the securitization of climate change has failed (Oels
2012; McDonald 2012).1 It remains to be seen whether the securitization
of climate change is a temporal trend limited to some Western countries or
may increase in importance with growing climate challenges and spread to
developing countries as well.
To what degree a growing climate stress will actually lead to violent con-
flicts depends on human and societal responses which are shaped by the
conflict history, group identities, the organization and capacity of conflict
parties, as well as the instrumentalization of resources for group interests
and power structures. Conditions to reduce conflict potentials include
political institutions and governance structures, resilient communities and
sustainable livelihoods, cooperation and conflict regulation mechanisms.
These aspects will be discussed in more detail for climate-induced migra-
tion which is one of the fields that has attracted a vigorous securitization
discourse.
SECURITIZATION OF CLIMATE-INDUCED
MIGRATION
Migration is a possible response to climate change and has been identified

as one of the potential conflict constellations in climate hot spots. In the
following some of the issues in the securitization of climate-induced migra-
tion are highlighted.
Pathways, Agents and Narratives of Securitization
In recent years, the link between climate change, migration and security
has raised increasing attention in public statements and the research
literature which identifies environmental migration as a potential secu-
rity problem. Climate change has been described as a stress factor that
increases migration pressure in climate hot spots (WBGU 2008; Warner
et al. 2010; Gemenne 2011). The impacts of drought, water scarcity, food
insecurity and extreme weather events on human livelihood are supposed
to become driving factors for the displacement of people.
Environmental migration has multiple causes and multiple effects,
depending on environmental as well as socio-political factors. People
migrate for many reasons, including worsening conditions in their lives and
incomes but also because they search for new opportunities. Regarding

environmental migration, Jäger et al. (2009) distinguish between people

who (a) move voluntarily from their residence primarily due to environ-
mental reasons (environmental migrants); (b) are forced to leave their
residence because of environmental risks (environmental displaced); or
(c) are intentionally relocated or resettled due to a planned land use
change (development displaced). In many cases it is difficult to separate
the different drivers, thus environmental migrants will appear as eco-
nomic migrants (e.g. farmers losing income) or as refugees of war (from
environment-induced conflict). One of the main routes of environmental
migration occurs from rural to urban areas, mostly within a country, in
other cases as transnational migration.
The number of environmental migrants and displaced persons is
expected to rise in response to climate change, as well as the indirect con-
sequences such as economic decline and conflict. Where living conditions
become unbearable, people are under pressure to leave their homes to seek
refuge elsewhere. Environmental scientist Norman Myers estimated that
the number of environmental migrants would rise to 150 million by 2050,
up from 25 million in the mid-1990s (Myers 2002). Some studies present
even higher estimates of the number of potential climate migrants up to
several hundred million people who have to flee the impacts of climate
change. This exceeds by far the number of registered refugees worldwide,
according to the U.N. High Commissioner for Refugees. By the end of
2011, some 42.5 million people worldwide were considered as forcibly dis-
placed due to conflict and persecution, including 15.2 million refugees and
26.4 million Internally Displaced Persons (IDPs) (UNHCR 2011).
A number of studies on the effects of climate change have described
migration as a negative factor – a threat to human security and societal
stability, and a generator of violent conflict, in particular in regions where
migration is criminalized or inhibited by societies which fail to integrate
migrants. Whether the risks prevail depends on several factors and condi-
tions. A planned migration in response to a gradual environmental deg-
radation is different from a sudden mass exodus after an extreme weather
event which can undermine the stability of communities. Under adverse
circumstances migration can increase the likelihood of conflict in transit
and target regions when migrants compete with the resident population
for scarce resources such as farmland, housing, water, employment, and
basic social services. In certain cases immigrants are perceived to upset
the “ethnic balance” in a region (Reuveny 2007). In countries without
disaster management (e.g. weather warning systems or evacuation plans),
extreme weather causes relatively greater damage and forces more people
to migrate than in countries with these systems (WBGU 2008). Affected
governments face enormous challenges if they have to handle sudden,

unexpected and large-scale migration which can even overwhelm the man-
agement capacities of developed countries.
Most directly affected by climate change are the local communities as
well as the migrant communities and networks, as far as human security
is at stake. While in many cases the challenges are addressed at the area
exposed by attempts for improving human living conditions, forced dis-
placement can be seen as an extraordinary response to severe climate risks.
In the latter case, affected communities, NGOs supporting them and those
concerned about conflicting interests may use securitizing speech acts
to make their case to protect or defend against “climate refugees” (e.g.
for Small Island States). Regions that have been characterized as most
vulnerable are coastal and riverine zones, hot and dry areas and regions
whose economies depend on climate-sensitive resources. Although envi-
ronmental migration will predominantly occur within national borders
of developing countries, there is concern in industrialized regions about a
substantial increase in external migratory pressure. Europe could see an
increase in migration from sub-saharan Africa and the Arab world, and
North America from the Caribbean, and Central and South America.
Treating the projected “climate refugees” as a security threat can be
used to justify extraordinary measures in target regions that can drive
not only the securitization, but also the militarization of climate-induced
migration, including military and police action for border control (e.g.
by the Frontex organization in Europe). Concerns about internal state
security and international terrorism are driving the securitization of envi-
ronmental migration. A new arsenal of technologies of political control
and weapons has evolved that together with new military doctrines can
be actively deployed against civilians in new public order roles, including
negative human responses to climate change (Wright 2012). There is the
risk that enhanced border control and crowd control initiatives merge with
the massive funding for future security technology innovations provided
in anti-terror and homeland defense activities.
Critical Perspectives
The securitization of the climate-migration discourse has received consid-

erable attention but also criticism by scholars who question the underly-
ing assumptions as well as the potential implications (for a collection of
contributions see Scheffran et al. 2012a). One focus is the weak empirical
evidence of some of the claims. There is a wide range of future estimates
on the number of environmental and climate-driven migrants. Projections
with huge numbers of climate refugees have been criticized as speculative
and exaggerated, lacking justification and empirical foundations (Jakobeit

and Methmann 2012). “Apocalyptic narratives” that forecast massive,

abrupt and unavoidable flows of climate refugees are refused (Bettini
2012; Methmann and Rothe 2012). The maximalist quest for numbers
faces conceptual problems of definition, causation, and prediction that
stretch the predictive capacity of the social sciences beyond their limits.
Empirical findings also reach no consensus whether environmental migra-
tion is a significant precursor for violent conflict (Barnett and Adger 2007;
Reuveny 2007).
This is partly due to the complex and uncertain multiple causal
chains between climate change, migration and conflict which preclude
simple statements that isolate environmental factors from other migra-
tion drivers. New research approaches and integrated frameworks are
needed to better understand the linkages between climate change, natural
resources, human security, migration and conflict, based on case studies
that allow for reconstructing the complex causal mechanisms (see WBGU
2008; Buhaug et al. 2008; Scheffran et al. 2012bd). Without a thorough
understanding of the phenomenon, its prediction remains obscure.
Some scholars criticize the threat terminology regarding migrants who
are struggling for their life (Oels 2011). Many non-governmental organi-
zations emphasize that those who are vulnerable and exposed to climate
risks are “victims”, requiring international interventions and protec-
tion. Treating environmental migrants as a security threat could become
a self-fulfilling prophecy when securitizing language justifies reactive
strategies and precludes preventive approaches.
The maximalist approach has been questioned due to lacking awareness
of different political frames and responses which often ignore the poten-
tially severe consequences for the populations affected. A major concern
is the instrumentalization of climate refugees in on-going political power
games, which has been analysed within Foucault’s “power-knowledge”
framework (Oels 2012). Critical assessments challenge any military and
security “solutions” to climate change (Wright 2012) and suggest to
monitor and resist the securitization or militarization of the responses
to climate change. It is seen as problematic if the well-funded security
markets reorient their focus to environmental challenges and related social
consequences, and address these problems with worst case scenarios and
technical fixes to climate change.
One difficulty in this debate is that there is no commonly agreed defini-
tion of climate migration. Mixing up different meanings complicates con-
structive policies. If “regular” refugees are pushed into the same category
as “environmental” refugees, this may bring about the demise of refugee
rights. High numbers of “climate refugees” could spur anti-immigration
discourses. An open debate may foster more emancipatory solutions to

the problem of environmental migration such as an improved global social

policy, local autonomy, and a more just migration policy.
Strategies and Opportunities
Instead of being a security threat migration can be an effective adaptation

strategy to climate change, creating opportunities for the communities in
both the regions of origin and destination as well as the migrants them-
selves. Strategies could be applied at international, individual, bilateral
and national levels. The likelihood of conflict is affected by the function-
ing of local and national governments; and it is lower in countries where
governments are well prepared for emergencies. It is important to analyse
the current global governance of refugees, before reflecting on the political
constraints that these proposals are likely to face.
The existing governance mechanisms are not sufficiently developed to
deal with the challenge of climate-induced migration (Biermann and Boas
2012). The protection of climate refugees requires an effective system of
multi-level governance, with a strong global framework providing vital
support for, and coordination of, national and local efforts to develop
a blueprint for a global governance architecture for the recognition,
protection, and voluntary resettlement of climate refugees. To be suc-
cessful, this regime needs to be tailored to the needs of climate refugees,
and be appropriately financed and supported by the international com-
munity. Several governing principles were suggested: planned relocation
and resettlement instead of temporary asylum; collective rights for local
populations; international burden-sharing and international assistance
for domestic measures; and financial support and compensation of
climate refugees (Biermann and Boas 2012). The same authors suggest
new legal instruments, a “Protocol on Recognition, Protection, and
Resettlement of Climate Refugees” and a “Climate Refugee Protection
and Resettlement Fund”.
To overcome the threat-victim dichotomy of refugees, it is important to
understand communities and migrants as active social agents that shape
and create their livelihood under changing environmental conditions and
find collective responses to the climate challenge. The poor and vulnerable
are not just passive victims, but actively try to improve their livelihoods
within their constraining living conditions. Throughout history, migration
has been an adaptive response not only to poverty and social deprivation
but also to environmental and climatic changes. Though migration was
often associated with hardships, it also offers opportunities through the
acquisition of new knowledge, income and other resources as well as the
creation of social networks across regions, which can be used to increase

resilience. Recent studies propose migration as an important adaptation

measure to climate change (Foresight 2011), which could strengthen the
resilience of affected communities. Adger et al. (2002) points to the signifi-
cance of migration effects on social resilience and the natural environment
in both sending and receiving areas.
An integrated view considers the ambiguity of the climate-migration
nexus, emphasizes challenges and opportunities of migration for devel-
opment and climate adaptation, and aims to improve the understanding
under which conditions “distress migration” can turn into “migration
as opportunity” (Scheffran et al. 2012c). Innovative approaches and
institutional frameworks can make existing actions more efficient, open
new action pathways and establish rules that strengthen social resilience.
This includes co-development as an integrative concept that links strate-
gies and networks between host and home countries of migrants (e.g.
between the USA and Mexico or between Europe and Northern Africa).
Cooperation across regions could support the less developed countries as a
compensation for higher GHG emissions of the more developed countries
(Oswald-Spring 2012). These compensation mechanisms could include the
acceptance of a negotiated number of environmentally forced migrants.
Preventive and cooperative migration practices focus on development,
livelihood improvements and environmental services. This includes strong
social and environmental policies, as well as jobs for migrants to meet the
demand for labour (Oswald-Spring 2012). This would reduce the social
vulnerability of migrants, to some extent diminish illegal and criminal
activities, and improve the living conditions of immigrants in the destina-
tion country. In developing countries, environmentally-forced migration
could be reduced by rural development policies, by preventive learning and
early warning, and by appropriate adaptation and mitigation mechanisms.
SECURITY AND CONFLICT ISSUES OF CLIMATE

POLICIES
While the impacts of climate change have become subject to securitization,

measures to prevent or adapt to climate change are also facing concerns
about security and conflict implications (Tänzler et al. 2012). Examples
are struggles on building dykes against floods, compensation of affected
people, approaches to manage a disaster or resettlement of victims.
Achieving a fair balance between those affected by climate change and
those responsible for it is a continued field of conflict between North and
South, rich and poor, state and non-state actors at local and global levels.
Disputes on how to avoid climate change with mitigation strategies have

been in the center of climate policies and could reach a new level with the
transformation to a low-carbon society. While a wide range of mitigation
strategies is possible, we will discuss potential security issues related to
non-fossil energy sources as well as geoengineering approaches.
Potential Interactions Between Nuclear and Climate Risks
While public perception of nuclear power was initially shaped by its

destructive potential in nuclear weapons and the East-West nuclear arms
race, the civilian use of nuclear energy was associated with technical
progress and almost unlimited energy supply. After a high growth in the
mid-1970s, new nuclear reactor constructions declined, reaching low levels
after the Chernobyl accident in 1986. India, China and other developing
countries expand their nuclear power capacity to satisfy their growing
energy demand. With emerging concerns about climate change, a “nuclear
renaissance” has been proposed to expand nuclear power as a carbon-free
source of electricity (Kessler 2012).
Since the 1970s nuclear power has been subject to domestic controversy.
Due to protests and accidents public acceptance dropped in several coun-
tries which opted to phase out nuclear power, including Germany, Italy,
Switzerland and Spain. Opponents have criticized nuclear power as a
complex, unsafe, centralized and large-scale technology that is expensive,
not commercially competitive and heavily subsidized (Acheson 2011). Most
controversial have been the risks to human health and life. Radioactive
materials are released and accumulated in the environment throughout
the nuclear fuel chain, including uranium mining and fuel rod production,
reactor operation and reprocessing, transportation and disposal. Nuclear
facilities are vulnerable to accidents, natural disasters and extreme weather
events, as demonstrated by the March 2011 earthquake and tsunami in
Japan that destroyed the Fukushima Nuclear Power Station. Nuclear
waste continues to rise and will remain a problem for many future genera-
tions, without responsible and affordable solutions in sight.
Most significant security issues are raised by the link between nuclear
power and nuclear weapons. Despite safeguards attempts by the
Non-Proliferation Treaty and the International Atomic Energy Agency,
the number of nuclear weapon states has increased, becoming a driver
of armed conflict and arms races, as demonstrated by the cases of Iraq
and Iran. Further security concerns are the vulnerability of nuclear facili-
ties against war or attacks by non-state actors, and the possibility that
nuclear weapons or sensitive nuclear materials could fall into the hands
of terrorists.
In the future, nuclear energy and climate change may interact in

ultiple ways. Nuclear power is a low-carbon energy source (though not

m
carbon-free during the whole life-cycle) but it is unlikely that nuclear fuels
will replace fossil fuels and prevent global warming due to high costs,
limited and non-sustainable uranium resources, long planning cycles,
inadequacy in combustion and as transportation fuel. The avoided risks
of climate change need to be compared to nuclear risks, including nuclear
proliferation as well as costly military responses such as missile defense
and counter-proliferation. Although US-Russian nuclear arsenals have
been significantly reduced more than 20,000 nuclear weapons still remain,
enough to destroy the planet multiple times over. Recent scientific studies
on nuclear winter suggest that even a limited regional nuclear exchange
with a few hundred nuclear weapons would eject so much debris into the
atmosphere that global temperatures could rapidly drop and food supply
be severely affected for years (Toon et al. 2007).
In a confrontative environment with nuclear weapons it is more dif-
ficult to tackle the problem of climate change cooperatively. In turn,
when climate change contributes to global insecurity and conflicts, this
could create more incentives for states to rely on military force, including
nuclear weapons. These scenarios suggest that a combination of nuclear
and climate risks might create a volatile and unpredictable security
environment (Scheffran 2011).
Renewable Energy and Land Use Conflicts
Growing concerns about energy security and climate change have

increased the interest in energy from wind, hydro, solar, geothermal or
bioenergy sources for meeting the society’s electricity, heating and fuel
needs. The proposed transition from fossil fuels to low-carbon renewable
energy sources requires large areas of land and related infrastructure,
creating new forms of “energy landscapes”. On the one hand, renewa-
bles have environmental impacts and footprints which are usually local
(Jacobson 2008) and may lead to conflict with other land uses. On the
other hand, transnational cooperation in renewable energies contributes
to technology-transfer, new economic options and development perspec-
tives. A sustainable energy transition seeks to develop environmentally
responsible and economically efficient land-use paths. Finding a balance
between conflict and cooperation requires to address the specific charac-
teristics of each renewable.
Bioenergy
Bioenergy has raised great expectations as a renewable, domestic and
carbon-free energy source that creates jobs and income in rural areas of

developed and developing countries. In the past decade the biofuel indus-
try has rapidly grown in a number of countries, driven by governmental
mandates and subsidies. Due to low efficiency of the photosynthetic
conversion of solar radiation into biomass, large areas of land are needed
which increases competition with other uses of land, such as agricultural
food production and nature protection. Throughout history, the extensive
use of wood has contributed to deforestation and landscape changes.
Burning of fire wood in homes causes severe health problems and deaths
until today. Direct effects of bioenergy include local environmental
impacts upon air, water and soil quality, the degradation of habitats and
biodiversity. The agro-industrial expansion of bioenergy crops (rape seeds,
oil palms, sugar cane, maize) affects food security, deforestation and mar-
ginalization of traditional agricultural systems and landscape degrada-
tion (Scheffran 2010; Scheffran and Summerfield 2009). Thus, a growing
bioenergy use could increase food prices and land acquisitions which may
contribute to food riots. Although in theory bioenergy is carbon neutral,
there are carbon emissions during the whole lifecycle. While land clearing
for bioenergy production releases carbon, biochar offers an opportunity
for organic soil carbon sequestration. To improve the insufficient energy
and carbon balance of the current generation of biofuels, more efficient
bioenergy pathways are under development, including algae and second
generation biofuels based on biotechnology. To constrain adverse impacts
of bioenergy, sustainability criteria have been suggested and dialogues
among stakeholders (Maestas 2012).
Hydropower
While in many industrialized countries the dam-building boom is over,
some developing countries are expanding hydropower, especially in
Latin America, East and Southeast Asia. Large hydro projects flood
landscapes over hundreds of square kilometres, with severe impacts on
ecological habitats, human livelihoods and cultural assets. Worldwide
an estimated 40-80 million people were evacuated from their homes
(Ponseti and Pujol 2012). In China alone more than 1 million people
were displaced to build the Three Gorges Dam at the Yangtzekiang, the
world’s largest hydroelectric dam. A number of big dam projects pro-
voked local resistance, for instance against the Narmada dam in India.
In a few cases, international disputes emerged, e.g. between Hungary and
Slovakia over the ecological and social impacts of the Gabcikovo dam on
the river Danube. The GAP project of Turkey along the Euphrates River
became a conflictive issue with the local Kurdish population and with
Iraq as a downstream country. In response to rising protests, the World
Commission on Dams involved civil society participants and released a

joint report in 2000 that defined criteria for the evaluation of big dams,
favouring smaller projects.
Wind power
Due to the low energy density of the wind, wind power plants are spread
over large areas and reach into high altitudes to increase efficiency. While
some people directly benefit from additional income of wind power, others
living in these areas complain about sound and shadows from rotors
(Zoll 2001). Environmentalists are concerned about the impacts on birds
and other animals or the effect of large off-shore wind power stations on
marine ecosystems. Some complain about the transformation of land-
scapes. Occasionally there have been protests against large wind turbines
and lawsuits to affect political decisions. While the impacts are subject to
research, technical developments and economic gains have contributed to
reducing the risk and building public support.
Solar energy
Although small-scale, decentralized use of solar energy is widely accepted
among citizens, costs are still higher than alternative energy sources.
Ecological and social interventions as well as conflict potentials may
become more significant with large-scale industrial use and growing
dependence on solar energy from other regions. The Desertec concept pro-
poses to develop the solar energy potential in the world’s deserts through
cooperation between industrialized and developing countries which are
connected by an electric power grid, e.g. across the Mediterranean. To
avoid the conflict patterns in this region established for oil and natural
gas, non-governmental organizations recommend criteria for economic
viability, environmental sustainability, social acceptability and political
stability that strengthen security, development opportunities, climate
adaptation and capacity building for the local population (Klawitter and
Schinke 2011).
Other renewable energy systems (geothermal, tidal or ocean wave
energy) have specific impacts on the local environment and attract minor
criticism but no major conflicts yet. Although the conflict potential of
renewable energy sources cannot be neglected, it has to be compared to the
substantial security risks and conflicts of fossil and nuclear energy sources.
As long as renewable energy systems and their infrastructure are based on
small-scale technologies, conflicts remain local. With the rapid and global
expansion of space-intensive renewables to the same order as fossil energy,
demands for investment, land and other critical resources could become
an issue of conflict which involves a range of possible actions (demonstra-
tions and protests, blockades and sabotage acts, police operations). How

these evolve, depends on public acceptance and the effectiveness of regula-

tory mechanisms to balance benefits, costs and risks.
Geoengineering the Climate: an Issue for Security Policy?
Geoengineering is offered as a solution for reducing dangerous climate

change by deliberate interventions into the climate system on a global
scale. Two different types of measures have been suggested (for an over-
view see Royal Society 2009; Rickels et al. 2011).
● Carbon dioxide removal (CDR) reduces atmospheric carbon con-
centration as a cause of global warming. CDR techniques include
carbon capture and sequestration in biomass, soil, underground or
in the ocean through afforestation, biochar, ocean fertilization and
enhanced weathering.
● Solar radiation management (SRM) diminishes the symptoms and
effects of global warming by changing the earth’s radiation balance.
SRM technologies focus on the absorption of sunlight, e.g. by
aerosol emissions into the higher atmosphere, similar to volcano
eruptions; or by the reflection of sunlight, e.g. through surface
brightening, cloud whitening or large reflectors in outer space.
Recent research has focused on the technical, environmental and economic
dimensions of geoengineering, but increasingly includes political, psycho-
logical, ethical and social implications. There is still a lack of understanding
for many critical issues, in particular the risk and conflict potential. Various
arguments have been used: Geoengineering may pollute the environment,
consume resources and investments, distract from climate mitigation poli-
cies, provoke security risks, public resistance, tensions, and conflicts. More
specifically the following types of risks and conflicts of GE can be identified
(Maas and Scheffran 2013; Scheffran and Cannaday 2013).
● Distribution of benefits, costs and risks: Geoengineering will not

have a uniform global impact but can substantially differ regarding
the local, regional, and international consequences which are specific
to the respective environments. Some impacts are foreseeable, such
as cooling or changing rainfall from aerosol emissions or change
in ecosystems, vegetation and crop yields. Injecting sulphur into
the stratosphere may have environmental impacts similar to pol-
lution. Other consequences are unintended and unpredictable, e.g.
when geoengineering triggers tipping elements in the climate system.
Concerns about these risks and consequences provokes resistance
and conflict between those who benefit from these measures and

those who are negatively affected and have inadequate coping

mechanisms. Here regional differences can be quite significant.
● Competition for scarce resources: to realize geoengineering, com-
prehensive infrastructures and efforts are required which need
resources (energy, raw materials, water, land), add pollution and
change natural and social systems along the lifecycle. Compared
to SRM, CDR requires a larger scale implementation to have
a globally meaningful impact which needs substantial financial
investments, resources and ecosystem services to have a significant
effect. There are only limited places in which such activities are pos-
sible in technical, economic and political terms, leading to concerns
of increasing pressure on resources and communities in affected
regions. While SRM could be implemented by a few countries, a
larger number of countries would need to engage in CDR to make a
difference for the climate. CE measures compete with investments in
other areas, in particular mitigation and adaptation strategies.
● Power games on climate control: during the Cold War the super-
powers supported a small amount of research on weather control
for offensive and defensive purposes (Fleming 2010). While climate
control is more difficult to operationalize for military purposes,
it contains significant potential dual use capabilities that could
increase threat perceptions and worst-case scenarios. Countries may
support research, testing and deployment of geoengineering as an
instrument for power projection. When countries try to “optimize”
their own climate, trans-regional effects create a potential for inter-
national disputes and security dilemmas. Although intended geoen-
gineering may avoid some risks and conflicts of unintended climate
change it could also contribute to the climate-conflict nexus. The
question is whether the cure is worse than the cause.
Similar to other forms of environmental modification such as large-scale

deforestation, building big dams along rivers, or genetic engineering, geo-
engineering measures will likely face resistance by local communities. One
indicator is on-going protests against carbon capture and sequestration
in Germany. Local actions could combine with international tensions
between states, leading to complex multi-level interactions in the interna-
tional system. Considering a hypothetical scenario, a series of droughts
in the US Midwest could drive farmers to pressure their government to
implement rapid SRM intervention which may provoke countermeasures
by Russia or China. In a geoengineered world anyone applying these
techniques could be blamed for weather-related disasters and associated
damages elsewhere, whether justified or not.

Individual attempts to regulate global temperature could lead to secu-

rity dilemmas from local to global levels and a range of competing actions,
including local protests, diplomatic crises, violent actions against geoengi-
neering components, terrorism, and armed conflict. Collective regulation
of geoengineering requires an effective global governance system which
needs to resolve a number of critical questions: Which climate is to be
designed? Who is responsible for particular risks? Which consequences are
judged as acceptable or inacceptable? How can the responsibility for pro-
hibited actions be verified? How can compliance be enforced and conflicts
be resolved?
Currently there are no legal mechanisms to regulate geoengineering
although some agreements may be affected (for an overview see Rickels et
al. 2011). If geoengineering activities are classified as pollution, they could
fall under the respective environmental agreements, such as the Montreal
Protocol for the Protection of the Ozone Layer, the Law of the Sea,
and the London Convention and Protocol on the Prevention of Marine
Pollution by Dumping of Wastes and Other Matter. The UN Framework
Convention on Climate Change (UNFCCC) precludes dangerous anthro-
pogenic interference with the climate system, which applies to dangerous
climate change as well as dangerous geoengineering. However, the term
“dangerous interference” has not been specified. Similarly, the 1978
Convention on the Prohibition of Military or Any Other Hostile Use of
Environmental Modification Techniques (ENMOD) restrains the military
or other hostile modification of the Earth’s environment, but does not
prohibit the peaceful use of geoengineering.
Activities for the regulation of geoengineering in the early stages include
a moratorium on geoengineering activities recommended at the 2008
Convention on Biological Diversity (CDB) and a report by the British
House of Commons that formulated the “Oxford Principles” for geoengi-
neering research. These suggest to (i) regulate geoengineering as a public
good, (ii) let the public take part in the decision-making process, (iii) dis-
close the results of research, (iv) have an independent impact assessment
conducted, and (v) only begin with any implementation after a governance
process is completed (Rayner et al. 2009).
ENERGY TRANSFORMATION, DESECURITIZATION

AND CONFLICT PREVENTION
Energy and climate change are increasingly subject to securitization. In

the new emerging security and conflict landscapes, people are exposed to
various risks of energy use, climate change and geoengineering. In this

complex environment where everyone can contribute to the problems

and be affected by it, traditional instruments of security policy, such as
military buildup and interventions, will be ineffective. An integrated and
coordinated global governance approach would combine measures in
different regions and policy fields, including environmental policy, devel-
opment policy and security policy, from local to global levels. Given the
large uncertainties and complexities in the energy-climate-security nexus,
anticipative and precautionary approaches are adequate that adapt to
the knowledge about possible futures. Adaptive strategies constrain and
adjust the path of GHG emissions towards a target domain of the climate
system (e.g. a range of carbon concentration or global-temperature) to
avoid dangerous areas. Continuously updated scientific information is
essential to adapt future paths to sight, destination and unexpected events,
as well as actions by other actors.
To achieve the proposed transformation of the fossil energy system
towards a low-carbon society (WBGU 2011), energy pathways need to be
systematically assessed and compared regarding benefits, costs, risks and
conflict potentials. To build a secure, equitable and sustainable energy
system that harvests the benefits while minimizing risks and conflicts,
principles, criteria and standards for sustainable peace are to be imple-
mented in legal norms, certification systems and monitoring processes.
Mechanisms for desecuritization, mediation and conflict resolution can
support this process, including stakeholder dialogues, participatory deci-
sionmaking and arbitration. Then geographies of conflict on energy and
climate change could be transformed into landscapes of cooperation on
avoiding dangerous anthropogenic interference with the climate system.
NOTES
* Research for this study was funded in part by the German Science Foundation (DFG)
through the Cluster of Excellence CliSAP (EXC177).
1. The argument that the securitization of the environment failed has already been sug-
gested in Buzan et al. 1998, where they argue that the exceptional measures in the envi-
ronmental sector are within the borders of normal politics. The argument is repeated
in Buzan and Wæver (2009) where they suggest that climate change has determined a
metapoliticization rather than a metasecuritization.
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16. Environmental implications of energy
production
Yolanda Lechón, Natalia Caldés and
Pedro Linares
1 INTRODUCTION
The assessment of the environmental implications of energy production is

a wide and complex challenge. Many energy sources and technologies exist
with very different environmental profiles and implications in the form
of emissions to the environment, hazardous wastes, occupational risks,
production of noise or visual intrusion or risks of accidents, etc. All of
them impose risks on human beings, ecosystems and materials, producing
damages that are external in the sense that they are not taken into account
by the person or institution causing the effects. Such effects, known as
externalities, are then not incorporated in the market price of the energy
products they generate. The presence of externalities in the energy market
is a market failure that results in the energy mix being inefficient from a
social point of view.
When investment or operation decisions are made, e.g. about which
power plant technology to use or where to locate a power plant, it would
be beneficial for society to take environmental and health impacts into
account and include the external effects into the decision making process.
Quantifying these implications in a comparable manner would help energy
policy makers in finding the energy mix which maximizes social welfare.
In order to be able to assess and compare the external effects with each
other and with private costs, it is convenient to express them in a common
unit such as a monetary unit. Thus converting external effects into mon-
etary units results in external costs that can be easily used in a cost-benefit
analysis or be internalized through the appropriate environmental policy
instruments.
In the first section of this chapter we will review the environmental
implications of a wide variety of energy sources and technologies. In the
case of fossil fuel technologies, as the previous chapter has examined the
environmental impacts of fossil fuel extraction, this chapter will focus
on those impacts produced during energy generation. However, in the
case of renewable energies, the environmental implications of the energy
345

g eneration stage of the fuel chain are in many cases negligible and most
impacts are produced in either upstream or downstream stages. Therefore
a discussion of these impacts will also be included.
In the second section of this chapter, the methodological options to
quantify environmental implications and externalities of energy tech-
nologies will be briefly introduced, including the Life Cycle Assessment
methodology and the ExternE methodology for externalities assessment.
Finally, in the last section, some results of environmental impacts and
externalities of different energy technologies will be presented.
2 ENVIRONMENTAL IMPLICATIONS OF
DIFFERENT ENERGY SOURCES
2.1 Coal
Coal is the world’s most abundant and widely distributed fossil fuel.
Around 27 per cent of the world’s total primary energy demand and 42
per cent of the world’s electricity production is based on coal combustion
(IEA, 2011). Several studies (MIT, 2007; IEA, 2011) conclude that coal
will continue to have an important role meeting the world’s energy needs
in significant quantities.
The main use of coal nowadays is electricity generation although other
uses include coking coal for steel manufacturing and industrial process
heating whereas for electricity generation, pulverized coal fired is the most
common installed technology nowadays (Bauer et al, 2008; IEA-ETSAP,
2010a). An average net thermal efficiency of 35–36 per cent is commonly
assumed for large existing plants with subcritical steam burning relatively
high quality coals.
Currently, supercritical pulverized coal (SCPC) power is the dom-
inant option for new coal-fired power plants (IEA-ETSAP, 2010a).
Super-critical pulverised coal (SCPC) power plants use supercritical steam
as the process fluid to reach high temperatures and pressures and reach
efficiencies up to 46 per cent. New ultrasupercritical (U-SCPC) power
plants may even reach higher temperatures and pressure, with efficiency
up to 50 per cent.
Integrated gasification combined cycles (IGCC) and Fluidized-bed
combustion (FBC) are alternative coal-fired power technologies. IGCC
can reach higher efficiencies varying from 39 per cent to 45 per cent while
the primary driving force for the development of fluidized-bed combus-
tion was the reduction in SO2 and NOx emissions at the combustor (Bauer
et al, 2008).

Environmental implications of energy production 347
Pulverised coal-fired power plants produce a considerable amount of

airborne emissions. Emissions of SCPC and IGCC power plants are quite
smaller and shown in Figure 16.1. Coal combustion produces also trace
elements such as metals, including nickel, mercury, arsenic, chromium and
cadmium (CATF, 2001).
Coal-fired power plants use large quantities of water for producing
steam and for cooling. Pollutants build up in the water used in the
power plant boiler, cooling system, ash handling plants and flue gas
desulphurization (FGD) plants (EC, 1995a; US-EPA, 2012). If the water
used in the power plant is discharged to a lake or river, pollutants in
the water can harm fish and plants. Further, if rain falls on coal stored
in piles outside the power plant, the water that runs off these piles can
flush heavy metals from the coal, such as arsenic and lead, into nearby
bodies of water.
The burning of coal creates solid waste, called ash, which is composed
primarily of metal oxides and alkali. On average, the ash content of coal
is around 10 per cent (6–20 per cent). Solid waste is also created when air
pollutants are removed from the stack gas. Much of this waste is deposited
in landfills and abandoned mines, although some amounts are now being
recycled into useful products, such as cement and building materials.
Finally, soil at coal-fired power plant sites can become contaminated
with various pollutants from the coal and take a long time to recover, even
after the power plant closes down.
2.2 Natural Gas
Natural gas is an extremely important source of energy that offers a

number of environmental benefits over other sources of energy, par-
ticularly other fossil fuels. Natural gas is important in many sectors of
the economy: for electricity generation, as an industrial heat source and
chemical feedstock as well as for water and space heating in residential
and commercial sectors. Moreover, natural gas is increasingly being used
in the transportation sector.
Power plants use several methods to convert gas into electricity. The
most common approach is to burn the gas in a combustion turbine to
generate electricity in the so called open-cycle gas turbine (OCGT) plants,
which offer a moderate electrical efficiency of between 35 per cent and 42
per cent at full load (IEA-ETSAP, 2010b). Another technology is to burn
natural gas in a combustion turbine and use the hot combustion turbine
exhaust to make steam to drive a steam turbine. This technology is called
“combined cycle” (CCGT) and achieves a higher efficiency. This technol-
ogy has been largely expanding in the last two decades (Bauer et al, 2008)

2,500
GHG (kg CO2 equiv/MWh) max
GHG (kg CO2 equiv/MWh) min
SO2 (g/MWh) max
2,000 SO2 (g/MWh) min
NOx (g/MWh) max
NOx (g/MWh) min
Particulates (g/MWh) max
1,500 Particulates (g/MWh) min
1,000
500
0
Coal PC Coal (U) Coal Natural gas Natural gas Oil GT Oil CCGT
SCPC IGCC GT CCGT
Sources: EC, 1995a; IEA-ETSAP, 2010; EC, 1995b; US-EPA, 2011a; EC, 1995b;
US-EPA, 2011a; IEA-ETSAP, 2010b.
Figure 16.1 Airborne pollutant emissions from fossil fuel fired power

plants
and its net electrical efficiency ranges from 50–58 per cent (Bauer et al,
2008).
There is a wide variety of environmental impacts generated by the use of
natural gas as a source of energy.
Composed primarily of methane, the main products of the combustion
of natural gas are carbon dioxide and water vapour, very small amounts
of sulphur dioxide and nitrogen oxides, virtually no ash or particulate
matter, and low levels of carbon monoxide as well as other reactive hydro-
carbons as shown in Figure 16.1.
Compared to the average air emissions from conventional coal-fired
generation, natural gas produces half as much carbon dioxide, lower
quantities of nitrogen oxides and almost no sulphur oxides at the power
plant.
The burning of natural gas in combustion turbines requires very little
water. However, natural gas-fired boiler and combined cycle systems do
require water for cooling purposes. Pollutants and heat build up in the
water used in natural gas boilers and combined cycle systems. When these

pollutants and heat reach certain levels, the water is often discharged into
lakes or rivers affecting water bodies’ ecosystems.
The use of natural gas to create electricity does not produce substantial
amounts of solid waste (EC, 1995b).
Other burdens from the operation of natural gas power plants include
noise and visual intrusion (EC, 1995b). The construction of natural gas
power plants, as any large facility, can destroy natural habitat for animals
and plants. Possible land resource impacts include erosion, loss of soil
productivity, and landslides.
2.3 Crude Oil
Crude oil is a vital source of energy for the world and will likely remain
so for many decades to come (IEA, 2011). The vast majority of petroleum
consumed in the world is used for transportation. The remainder is used
to create the many oil-based products used in industry and our houses
such as lubricants and plastics, to generate electricity and to heat our
homes.
The previous chapter analysed the environmental implications of
extracting crude oil, and the environmental consequences of the use of oil
products are analysed in a subsequent chapter. This chapter will focus on
the stages of the oil fuel cycle after oil extraction and up to the production
of fuels and electricity.
2.3.1 Petroleum refining

The petroleum refining industry converts crude oil into refined products,
including liquefied petroleum gas, gasoline, kerosene, aviation fuel, diesel
fuel, fuel oils, lubricating oils, and feedstocks for the petrochemical indus-
try employing a wide variety of processes.
Potential environmental impacts associated with petroleum refining
include the following (IFC, 2007):
● Air emissions
● Waste water
● Hazardous materials
● Wastes
● Noise.
Air emissions can be exhaust gases – carbon dioxide (CO2), nitrogen oxides
(NOx) and carbon monoxide (CO) – from combustion of gas, fuel oil or
diesel in turbines, boilers, compressors and other equipment for power
and heat generation, venting and flaring emissions and fugitive emissions

(hydrogen (H2), methane (CH4), volatile organic compounds(VOCs), poly-

cyclic aromatic hydrocarbons (PAHs) and inorganic gases such as asso-
ciated with leaks of hydrocarbon vapours from process equipment and
evaporation of hydrocarbons from open areas (US-EPA, 2011b; IFC,
2007). Sulphur oxides (SOx) and hydrogen sulphide may also be emitted
from boilers, heaters and other process equipment. Particulate emissions
from refineries are associated with flue gas furnaces and catalyst based proc-
esses, handling of coke and incineration of sludge. Carbon dioxide is pro-
duced in significant amounts during petroleum refining from combustion
processes, flares, hydrogen plants and catalyst regeneration (IFC, 2007).
Waste water from refineries includes “sour” water and alkaline waste
water (IFC, 2007). Waste water is treated in treatment units before dis-
posal. Oil refinery effluents contain many different chemicals at different
concentrations including ammonia, sulphides, phenol and hydrocarbons.
These effluents often have a toxic effect on the fauna, which is usually
restricted to the area close to the outfall (Wake, 2005).
Petroleum refining facilities also use significant amounts of hazard-
ous materials. Solid hazardous wastes from a refinery are spent cata-
lysts, solvents, filters, used sweetening, spent aminas, activated carbon
filters, sludge of several types, exhausted molecular sieves and exhausted
alumina.
The main causes of noise in a refinery are the large rotation machines
(compressors and turbines), pumps, air coolers and heaters.
2.3.2 Production of electricity from oil

Similarly to natural gas, oil is usually burnt in open cycle or combined
cycle gas turbines to produce electricity with similar technological char-
acteristics. Burning oil at power plants produces nitrogen oxides, sulphur
dioxide, carbon dioxide, methane, and mercury compounds. The amount
of sulphur dioxide and mercury compounds can vary greatly depending
on the sulphur and mercury content of the oil that is burned. The average
emissions are shown in Figure 16.1.
Oil-fired power plants use large quantities of water for steam produc-
tion and cooling. When oil-fired power plants get the water from a lake or
river, fish and other aquatic life can be killed, which affects those animals
and people who depend on these aquatic resources. Moreover, power
plants also release waste water – which contains pollutants and is gener-
ally hotter than the water in nearby lakes and streams – that can harm fish
and plants.
Also, when oil is burned at power plants, residues that are not com-
pletely burned can accumulate, forming another source of solid waste
which, if not properly disposed, can cause land contamination.

2.4 Nuclear Energy
Nuclear power is the use of sustained nuclear fission to generate heat and

electricity. Nowadays, nuclear power plants provide around 13 per cent of
the world’s electricity (IEA, 2011).
Most of the world’s reactors are light water reactors (LWR) that use the
so called “once-through” open fuel cycle in which the spent nuclear fuel
(SNF) from the LWR is sent to interim storage and eventually to waste
disposal. Other options are a partly closed fuel cycle that is currently used
in countries such as France, Germany and Japan in which the SNF is sent
to a reprocessing facility where plutonium is recycled back to LWRs as
mixed oxide (MOX) fresh fuel. Finally, there is a specific fast reactor fuel
cycle in which the plutonium in SNF is separated and reused to produce
fast reactor (FR) fuel. This strategy has been demonstrated but not yet
commercially deployed. (MIT, 2011).
The nuclear fuel cycle entails all the stages from the mining and milling
of uranium through the manufacture of the fuel, electricity generation in
the reactor, transport and reprocessing of the spent fuel and the manage-
ment of the associated waste in all these steps. The environmental conse-
quences of all these stages are briefly discussed below.
Uranium is mined in either open-pit or underground mines. Then, the
ore is processed at mills and the uranium is separated from the rock to get
uranium oxide (yellow cake).
Environmental impacts associated with uranium mining are related to
impacts on land and water due to waste water arising from mine drainage
and from water use in drilling. Also occupational health impacts due to
radon exposure are produced in this stage (EC, 1995c).
In the milling process, a high percentage of the radioactivity contained
in the ore remains in the mill tailings (fine sands released by the milling
plant which contain insoluble radium). Their associated environmen-
tal releases are the movement of the contaminated leachate to rivers or
groundwater as well as the atmospheric dispersion of fine particles by
wind.
From the mill, the yellow cake is converted into uranium hexafluoride
(UF6). To fabricate nuclear fuel, the UF6 must be further enriched in the
fissile isotope U-235. Enriched UF6 is then transformed into uranium
dioxide (UO2) powder and pressed into pellets that are inserted into thin
zircaloy or stainless steel tubes which are then sealed and assembled to
form fuel assemblies.
The main potential hazard in the conversion stage arises from the tox-
icity of hydrogen fluorine and fluoride used in the production of UF6.
Gaseous and liquid releases of F- can be produced. Atmospheric and

liquid releases of uranium isotopes are also produced in this stage (EC,
1995c).
The enrichment process uses a large amount of energy and atmospheric
and liquid releases of uranium are produced. As the level of enrichment
increases, the risk of criticality accidents also increases although this risk
is considered to be very small (El-Hinnawi, 1978). The depleted uranium
residue is stockpiled for possible future use. This material gradually
produces nuclides such as 226Ra and 222Rn that can generate radiation
hazard.
Fabrication of fuel elements is a non-hazardous process although some
atmospheric and liquid releases of uranium isotopes and chemicals are
produced. Manufacture of mixed oxide fuel is far more hazardous due to
the higher toxicity of plutonium and its lower critical mass.
During normal operation of a nuclear reactor, radioactive fission
and activation products are originated. Fuel elements retain most of
the radioactive materials, but some are produced within or are dif-
fused into the coolant which can later be removed by waste processing
systems.
Nuclear power plants use large quantities of water for steam production
and for cooling. As previously, some nuclear power plants obtain large
quantities of water from a lake or river, and discharge waste heat to the
cooling water which could affect fish and other aquatic life.
The solid waste from nuclear plants is mainly composed of spent fuel
which is classified as high level waste and stored on site for some time and
eventually taken to intermediate storage or reprocessing plants.
At the reprocessing plant the fuel is chemically dissolved and the resid-
ual fuel material – uranium and plutonium – can be recovered. Gaseous
effluents from a reprocessing plant include gaseous fission products and
also tritium, 14C and some Pu isotopes. Liquid effluents from a reproc-
essing plant are mainly composed of tritium, 14C and other minor radio
nuclides. Intermediate and low level solid wastes produced by reprocess-
ing plants are mainly structural elements of the fuel elements and can be
contaminated with spent fuel.
High-level wastes from reprocessing plants comprise highly-radioactive
fission products and some transuranic elements with long-lived radioac-
tivity. They are later vitrified into borosilicate (Pyrex) glass, encapsulated
into heavy stainless steel cylinders and stored for eventual disposal deep
underground.
Long-term managed storage of the spent fuel preserves future options
for its utilization at little relative cost (MIT, 2011). Managed storage can
be done safely at operating reactor sites, centralized storage facilities, or
geological repositories.

Public concern about reactor operation focuses on the possibility of

accident occurrence leading to the release of a considerable amount of
radioactivity to the surrounding environment. Various types of accidents
are possible during the operation of a nuclear reactor and many safety
devices are incorporated in the reactor design. In addition most power
reactors are placed inside a containment building.
There have been three significant accidents in the 50-year history of civil
nuclear power generation (WNA, 2012):
● Three Mile Island (USA 1979) where the reactor was severely
damaged but radiation was contained and there were no adverse
health or environmental consequences.
● Chernobyl (Ukraine 1986) where the destruction of the reactor by
steam explosion and fire killed 31 people and had significant health
and environmental consequences.
● Fukushima (Japan 2011) where three old reactors (together with a
fourth) were damaged and the effects of loss of cooling due to a huge
tsunami were inadequately contained. The fuel was badly damaged
and there were significant off-site radiation releases.
The safety provisions in a nuclear plant include a series of physical bar-

riers between the radioactive reactor core and the environment as well
as the provision of multiple safety systems. These safety systems are
“active” in the sense that they involve electrical or mechanical operation
on command, but in some recent designs the passive or inherent fea-
tures substitute for active systems. Such a design would have averted the
Fukushima accident, where loss of electrical power resulted in a loss of the
cooling function.
Another important aspect of the nuclear industry is the transport of
radioactive materials. Spent fuel elements are transported in shielded
cooled casks to prevent radiation exposure to transport workers. Accidents
producing rupture of casks could have severe impacts on the environment.
High level wastes are also transported to storage places in containers.
Management, packaging, transport, and disposal of waste are strictly
regulated and carefully controlled.
Plutonium-239, the isotope used in atom bombs, is produced in rela-
tively high quantities in the nuclear fuel cycle. Environmental hazard of
plutonium is related to the risk of the occurrence of a chain reaction if
sufficient plutonium came together, with the subsequent emission and
dispersion of plutonium to the environment.

2.5 Renewable Energies
2.5.1 Solar
Solar energy is the most abundant of all energy resources and there is a
large family of different solar energy conversion technologies capable of
meeting a variety of energy service demands.
Conversion of solar energy to heat (i.e., thermal conversion) is done by
specialized techniques and devices such as optical coatings and mirrors.
Generation of electricity can be achieved in two ways. Solar energy can
be converted directly into electricity in a device called a photovoltaic
(PV) cell. Solar thermal energy can also be used in a concentrating solar
power (CSP) plant to produce high-temperature heat which is then con-
verted to electricity via a heat engine and generator. Both approaches
are currently in use. Furthermore, solar driven systems can deliver
process heat and cooling, and other solar technologies are being devel-
oped that will deliver energy carriers such as hydrogen or hydrocarbon
fuels – known as solar fuels. Large CSP plants may also prove effective
for cogeneration to support water desalination (Arvizu et al, 2011; IEA-
ETSAP, 2011).
Emissions associated with generating electricity from solar PV tech-
nologies are negligible because no fuels are combusted. PV systems do not
generate any type of solid, liquid or gaseous byproducts when producing
electricity. Also, they do not emit noise or use non-renewable resources
during operation. However, two issues are of concern: the emission of
pollutants and the use of energy during the full lifecycle of PV manufac-
turing, installation, operation and maintenance (O&M) and disposal; and
the possibility of recycling the PV module materials when the systems are
decommissioned.
Energy is required to manufacture and install solar PV components,
and any fossil fuels used for this purpose will generate emissions. Most
lifecycle GHG emission estimates range from about 30 to 80 g CO2eq/kWh
(Arvizu et al, 2011).
Some PV cells make use of scarce and rare materials like indium and
tellurium. Large use of these cells would lead to resource depletion (IEA,
1998). Moreover, in its production lines, PV industry uses some toxic,
explosive gases, GHGs, as well as corrosive liquids.
Photovoltaic systems do not require the use of any water to create elec-
tricity. However, in certain locations, periodic cleaning of the PV panels
is required to maintain performance, resulting in non-negligible water
requirements.
Construction and operation of PV systems can cause land use impacts
on natural ecosystems. Main impacts are produced during construc-

tion activities and can be mitigated by minimizing earth movements and

helping to reestablish the previous biodiversity (IEA, 1998).
Visual impacts of PV installations depend on the type of scheme.
Centralized large schemes would have significant visual impacts
while small scale roof mounted schemes would have much lower visual
impact.
Decommissioning of PV systems may also cause some environmental
impacts especially in the case of CdTe modules due to the high toxicity of
cadmium. Recycling the material in PV modules is already economically
viable, mainly for concentrated and large-scale applications (McDonald
and Pearce, 2010; Arvizu et al, 2011).
For CSP plants, the environmental consequences vary depending on
the technology. Life cycle GHG emissions estimates fall between 14 and
32 g CO2eq/kWh (Arvizu et al, 2011). Main life cycle impacts are associ-
ated with the construction of the steel-intensive infrastructure for solar
energy collection due to mineral and fossil resource consumption, as well
as discharge of pollutants related to today’s steel production technology
(Lechón et al, 2009). However, most CSP solar field materials can be recy-
cled and reused in new plants (SolarPACES, 2008).
The deployment of CSP can also cause some unintended environmental
impacts. The main impacts are impacts on amenity and relate to the large
area required for the technology. The main impacts identified are the
following:
● Visual impacts: these impacts can be significant due to the large area
occupied by the mirrors. Visual effects are most noticeable in tower
CSP plants where very bright points appear in the rural landscape.
An advantage is that CSP plants are often located in areas with
limited amenity or aesthetic value (EASAC, 2011).
● Noise: noise will be generated from the steam generating plant (IEA,
1998).
● Ecological impacts due to land use: CSP plants have large land use
requirements. To date, most sites are in arid or semiarid areas which
have fragile soil and plant communities. Consequently, there could
be an important risk of soil erosion and habitat loss due to CSP
plants installations that could be significant in ecologically impor-
tant areas (IEA, 1998). Mortalities caused to vertebrates are the
main concern in respect of the local environmental impact of CSP.
Direct mortalities take place by collision with top mirrors and build-
ings (the tower in particular), and heat shock or burning damage
in the concentrated light beams plants (EASAC, 2011). Massive
establishment of solar plants in an area may affect regional animal

or plant populations by cutting dispersion routes and partially iso-

lating populations from each other (EASAC, 2011).
● If a plant is built on former agricultural land, available nutrients
in the soil may facilitate growth of vegetation up to 1 m in height
below and between solar collectors. The vegetation can dry up and
contribute to fire risk (EASAC, 2011).
● Water resources impacts: CSP plants using conventional steam
plants to generate electricity have a requirement for cooling water.
This could pose a strain on water resources in arid areas (IEA, 1998).
Because solar abundance and fresh water constraints often coincide
geographically, the cumulative impacts of installing numerous CSP
plants in a region raises policy concerns. Consequently, the trend is
towards more fresh water efficient cooling technologies (Carter and
Campbell, 2009). Water is also used for cleaning the mirrors to main-
tain their high reflectivity, although water use for cleaning is typically
a factor of a hundred lower than that used for water cooling. For
areas with high irradiation and available land close to the sea, using
salt water for cooling could be an attractive option (EASAC, 2011).
Most of these impacts are local and are therefore highly affected by the
siting of the technology. Consequently some of them can be minimized by
a sensitive siting choice.
2.5.2 Geothermal
Geothermal resources consist of thermal energy from the Earth’s interior
stored in both rock and trapped steam or liquid water. Accessible geother-
mal energy from the Earth’s interior can supply heat for direct use, can
be used in combined heat and power applications as well as to generate
electric energy.
Geothermal resources include basically low-enthalpy fields, which
have long been used for direct heating applications and high quality
high-enthalpy, which are used for power generation. In general,
high-enthalpy geothermal fields are only available in areas with vol-
canic activity, whereas the rest of the fields are low- or medium-enthalpy
resources (IEA-ETSAP, 2010c).
Currently, the basic types of geothermal power plants in use are steam
condensing turbines and binary cycle units. Steam condensing turbines
can be used in steam plants operating at sites with intermediate- and
high-temperature resources (≥150°C). Binary-cycle plants are commonly
installed to extract heat from low-and intermediate-temperature geother-
mal fluids (generally from 70 to 170°C), from hydrothermal- and EGS-
type reservoirs.

Newer geothermal plants in New Zealand and Hawaii are

combined-cycle or hybrid plants that provide relatively high electric effi-
ciency (IEA-ETSAP, 2010c).
Emissions associated with generating electricity from geothermal tech-
nologies are negligible because no fuels are combusted. However, geother-
mal fluids contain minerals leached from the reservoir rock and variable
quantities of gas, mainly CO2 and a smaller amount of hydrogen sulphide
(Goldstein et al, 2011).
CO2 emissions from geothermal power plants range from 4 to 740 g
CO2/kWh with an average of 122 g CO2/kWh (Goldstein et al, 2011).
According to the published LCA studies of geothermal electricity, life
cycle GHG emissions, including the emission from constructing, operat-
ing and decommissioning the power plants, are lower than 80 gCO2equiv/
kWh (Goldstein et al, 2011), value that compares very favorably to GHG
emissions from fossil sources.
Apart from CO2, geothermal fluids can, depending on the site, contain
a variety of other minor gases, such as hydrogen sulphide (H2S), hydro-
gen (H2), methane (CH4), ammonia (NH3) and nitrogen (N2). Mercury,
arsenic, radon and boron may also be present. H2S is toxic, but rarely
found in sufficient concentration to be harmful. CH4 is also present in
small concentrations.
Geothermal energy applications can have also some detrimental envi-
ronmental impacts. Concerns are related to impacts on water use and
quality. Geothermal power plants usually re-inject the hot water that they
remove from the ground back into wells. However, a small amount of
water used by geothermal plants in the process of creating electricity may
evaporate and therefore not be returned to the ground. Also, for those
geothermal plants that rely on hot, dry rocks for energy, water from local
resources is needed to extract the energy from the dry rocks (US-EPA,
2012).
Geothermal power plants can possibly cause groundwater contamina-
tion when drilling wells and extracting hot water or steam. However, this
type of contamination can be prevented with proper management tech-
niques. In addition, geothermal power plants often re-inject used water
back into the ground (through separate wells) instead of discharging the
used water into surface waters. This prevents underground minerals or
pollutants (boron and arsenic) from being introduced into surface waters
(US-EPA, 2012).
Scrubbers reduce air emissions but produce a watery sludge high in
sulphur and vanadium, a heavy metal that can be toxic in high concen-
trations. Additional sludge is generated when hydrothermal steam is
condensed, causing the dissolved solids to precipitate out. This sludge is

generally high in silica compounds, chlorides, arsenic, mercury, nickel,

and other toxic heavy metals). Usually the best disposal method is to
inject liquid wastes or redissolved solids back into a porous stratum of a
geothermal well.
Moreover, drilling activities, production and reinjection of fluids can
produce pressure and temperature changes in the fields that can lead to
geo-mechanical stress that can in turn cause micro earthquakes, subsid-
ence and steam eruptions.
Despite geothermal power plants typically requiring less land use than
fossil fuel power plants, this is still an issue since new projects or power
plants are often located within or adjacent to national parks or tourist
areas.
2.5.3 Bioenergy
Bioenergy includes different sets of technologies for applications in
various sectors. In 2009, biomass provided about 10 per cent of the annual
global primary energy supply (IEA, 2011) from low efficiency traditional
biomass use to high-efficiency modern bioenergy uses.
There is a wide variety of commercial bioenergy routes that starting
with feedstocks – such as forest or energy crops or industrial, commercial
or municipal waste streams and by-products – deliver electricity or heat,
biogas and liquid biofuels. Some of these routes are already commercial
and other are still in development stage (Chum et al, 2011; IEA Bioenergy,
2009).
As far as power generation is concerned, there are different technologi-
cal possibilities: biomass can be used in medium-size power plants by way
of mono-combustion as well as by way of co-combustion together with
fossil fuels such as hard coal in large power plants. Another option is the
gasification of biomass with subsequent combustion technologies with
gas and steam turbines (IGCC) which allows efficient power and heat
production (Gärtner, 2008).
Sustainably managed bioenergy can provide a number of beneficial
effects (IEA Bioenergy, 2009; Royal Society, 2008) depending on the
former use of the land where bioenergy is implanted, such as:
● enhanced biodiversity;
● soil carbon increases and improved soil productivity;
● reduced shallow landslides and local flash floods;
● reduced wind and water erosion;
● reduced sediment volume and nutrients transported into rivers; and
● improvements in growth and productivity and reduction of wildfire
risk in forests.

Some options for a sustainable bioenergy production have been identified

(Bringezu et al, 2009; Tilman et al, 2009; Ravindranath et al, 2009) and
include:
● increasing yields and optimizing agricultural production (including

double crops and mixed cropping systems);
● restoring formerly degraded land;
● use perennial crops;
● use sustainably harvested wood and forest residues;
● use of waste and production residues;
● cascading use of biomass.
The main environmental advantage of bioenergy is the fact that it is a part

of the terrestrial carbon cycle. The CO2 emitted due to bioenergy use was
earlier sequestered from the atmosphere and will be sequestered again if
the bioenergy system is managed sustainably. Thus, in a sustainable fuel
cycle, there would be no net emissions of carbon dioxide, although some
fossil-fuel inputs may be required for planting, harvesting, transporting,
and processing biomass.
If biomass wastes such as crop residues or municipal solid wastes are
used for energy, there should be few or no net greenhouse gas emissions.
However, under some circumstances, GHG emissions from bioenergy
can be very large. Drainage of peatlands or replacing tropical forests for
growing energy crops can lead to big amounts of GHG emissions (Royal
Society, 2008; Fargione et al, 2008; Page et al, 2011).
Diversion of crops or land into bioenergy can produce direct or indirect
land use change (LUC or ILUC) mobilizing C stocks and emitting addi-
tional amounts of CO2 that can in some cases offset the expected GHG
emissions savings (De Cara et al, 2012; Laborde, 2011; EEA, 2011; Tilman
et al, 2009; Melillo et al, 2009; Fargione et al, 2008).
Agricultural practices and specially the production and application use
of fertilizers, give rise to important life cycle GHG and other pollutant
emissions. N2O emissions arising after application of N fertilizers and
from the N present in crops residues are of special importance. These emis-
sions vary considerably with environmental and management conditions,
including soil water content, temperature, texture, carbon availability, and
therefore are difficult to assess.
A global greenhouse gas emissions policy that protects forests and
encourages best practices for nitrogen fertilizer use can dramatically
reduce direct and indirect GHG emissions associated with biofuels pro-
duction (Melillo et al, 2009).
Like conventional agriculture and forestry systems, bioenergy can

e xacerbate soil and vegetation degradation associated with overexploi-

tation of forests, too intensive crop and forest residue removal as well
as water overuse. Water requirements of energy derived from biomass
are about 70 to 400 times more than other energy carriers such as fossil
fuels, wind and solar (Gerbens-Leenes at al, 2009). Therefore, large scale
expansion of energy crop production could lead to a large increase in
water use and in some countries exacerbating an already existing stressed
water situation. Possible consequences of water overuse could be lowered
groundwater levels, river depletion, and reduced downstream water avail-
ability (IEA Bioenergy, 2009). Several options to reduce these impacts
exist including using less water demanding crops, increasing water use
efficiency and managing water for multifunctionality (De Fraiture and
Berndes. 2009). Bioenergy based on wastes and by-products of the food
and forestry sector would also avoid these problems.
Feedstock cultivation can lead to leaching and emission of nutrients
that increase eutrophication of aquatic ecosystems (Simpson, et al, 2009;
Royal Society, 2008) and pesticide emissions to water bodies may also
negatively impact aquatic life (Sala et al, 2009).
Increased biomass output for bioenergy can directly impact wild
biodiversity through conversion of natural ecosystems into bioenergy
plantations or through changed forest management (IEA Bioenergy,
2009; Royal Society, 2008). Habitat and biodiversity loss may also occur
indirectly. Eikhout et al (2008) showed that, in most cases, the long-term
positive effect of greenhouse gas reductions from biofuel production on
biodiversity are not enough to compensate for biodiversity losses from
land use change, at least not within a time frame of several decades.
However, when crops are grown on degraded or abandoned land, such
as previously deforested areas or degraded crop- and grasslands, the
production of feedstocks for bioenergy could have positive impacts on
biodiversity (Tilman et al, 2009).
Biodiversity impacts from the use of genetically modified energy crops
could also arise (IEA Bioenergy, 2009; Firbank, 2008).
Several processes exist to convert feedstocks and raw materials into bio-
fuels for use in transport. First-generation biofuels are produced through
processes such as cold pressing/extraction, transesterification, hydrolysis
and fermentation, and chemical synthesis, derived from sources such as
starch, sugar, animal fats, and vegetable oil. Second-generation biofuels
are produced through more advanced processes, including hydro treat-
ment, advanced hydrolysis and fermentation as well as gasification and
synthesis from ligno-cellulosic sources. Environmental burdens associated
with these processes are related to the use of energy and chemicals.
Combustion of biomass and biomass-derived fuels to generate electricity

and heat produces air pollution including carbon monoxide, nitrogen

oxides, and particulates such as soot and ash. The amount of pollu-
tion emitted per unit of energy generated varies widely by technology.
Compared to coal and oil stationary applications, sulphur dioxide (SO2),
toxic metals (cadmium, mercury and others) and nitrous oxide (NOx)
emissions from bioenergy applications are mostly lower. Pollutant for-
mation may occur due to incomplete combustion that can lead to high
emissions of unburnt pollutants such as CO, soot, and PAH. Although
improvements to reduce these emissions have been achieved by optimized
furnace design, there is still a relevant potential of further optimiza-
tion. Pollutants such as NOX and particles are formed as a result of fuel
constituents. Air staging or fuel staging technologies can reduce NOx
emissions by 50–80 per cent. As for other combustion technologies, if
combined with secondary abatement measures such as selective catalytic
reduction, reductions of up to 95 per cent can be achieved (Nussbaumer,
2003). The most serious problem is their particulate emissions, which must
be c ontrolled with special devices in place.
Raw municipal waste often contains toxic metals, chlorinated
compounds, and plastics, which generate harmful emissions.
Carbon capture and storage (CCS) from fossil-fuelled power plant flue
gases is being considered as a measure to reduce greenhouse gas emissions.
In this context, CCS can also be applied to co-firing plants, which would
enable the capture of carbon from biomass (biotic CCS), resulting in a net
negative carbon emission or carbon sink associated with biomass combus-
tion (IEA Bioenergy, 2009).
Biomass power plants require the use of water, because the boilers
burning the biomass need water for steam production and for cooling.
Whenever any type of power plant removes water from a lake or river, fish
and other aquatic life can be killed, which then affects those animals and
people that depend on these aquatic resources.
As is the case with fossil fuel power plants, biomass power plants have
pollutant build-up in the water used in the boiler and cooling system.
Pollutants in the water and the higher temperature of the water can
harm fish and plants in the lake or river where the power plant water is
discharged.
Biomass burning in boilers creates a solid waste called ash, which
despite having extremely low levels of hazardous elements, must be
properly disposed.
2.5.4 Wind
The use of wind energy requires that the kinetic energy of moving air be
converted to mechanical and then electrical energy using wind turbines.

On shore wind turbines have been increasingly installed around the

world providing nowadays 1 per cent of the world electricity (IEA, 2011).
Offshore wind energy technology is less mature than onshore being the
primary motivation to its development to provide access to additional and
high quality wind resources.
Emissions associated with generating electricity from wind technology
are negligible because no fuels are combusted. However, emissions are
produced in other parts of the life cycle both upstream and downstream.
The most significant are those associated with the processing and manu-
facturing of materials and components of the wind turbine (IEA, 1998;
EWEA, 2009). The majority of lifecycle GHG emission estimates cluster
between about 8 and 20 g CO2eq/kWh (Wiser et al, 2011).
Wind power plants generally require the use of large areas of land, using
space that might otherwise be used for other purposes. Special concern has
been raised recently about wind farm installations in peat land (Nayak et
al, 2010). Drainage of peat land produces the mobilization of the C stored
in the soil and also other impacts such as erosion and mass movements.
Provided wind turbines are carefully located, away from scenic, tourism
or highly populated areas, they tend to have low and localized impacts on
the environment. However, sensitivity to some of these impacts may cause
public opposition and make a project unacceptable (IEA, 1998).
Large wind farms pose aesthetic concerns. The dominant visual effect
is the intrusion of the turbines and associated equipment. Wind turbines
are highly visible structures often deployed in arrays of many machines on
ridges or hilltops. Moreover, wind turbines and power plants have grown
in size, making the turbines and related transmission infrastructure more
visible (Wiser at al, 2011). Opposition to wind energy on the grounds of
loss of visual amenity is one of the biggest problems in the wind indus-
try (EC, 1995d) and concerns have risen for both on- and offshore wind
energy (Ladenburg, 2009; Haggett, 2011).
Wind turbines that are improperly installed or landscaped may create
soil erosion problems (US-EPA, 2012; NWCC, 1997). These problems
can arise in deserts when the soil surface is disrupted during wind tower
construction or in hilly environments when towers are located on ridge-
lines where soil-holding vegetation is removed. Access roads to wind
turbine farms disrupt tracts of land and support equipment litters the
surroundings.
Wind farms can also have noise impacts mostly due to the operating
turbines (EC, 1995d). Possible impacts can be both audible and sub-
audible. Sub-audible sound may cause health effects but little evidence of
this effect has yet been found (Wiser at al, 2011). Regarding audible noise
from turbines, it can be mechanical noise (produced by the gear boxes and

generators) and aerodynamic noise created by the rotation of the blades.

This audible noise can impact sleep patterns and well-being (Wiser at al,
2011). New blade designs are being used to reduce the amount of noise.
Bird and bat mortality has been an issue at some wind farms. The types
of risks that may affect birds are mainly collision with turbines, habitat
disturbance and habitat loss as well as interference in birds’ movements
between feeding, wintering, breeding and moulting habitats (EWEA,
2009). As offshore wind energy has increased, concerns have also been
raised about seabirds (Wiser et al, 2011). The impact of wind power plants
on bat populations is of particular concern, because bats are long-lived
and have low reproduction rates (Wiser at al, 2011). Nevertheless, the
number of bird fatalities at existing wind power plants appears to be
orders of magnitude lower than other anthropogenic causes of bird deaths
(Erickson et al, 2005).
Wind power plants can also cause habitat and ecosystem modification
impacts on flora and fauna including avoidance of or displacement from
an area, habitat destruction and reduced reproduction (EWEA, 2009).
The impacts of wind power plants on marine environment are also an
issue for offshore wind farms. Constriction and operation of offshore wind
farms can affect marine mammals mainly due to stress and increased dis-
eases vulnerability caused by noise (EWEA, 2009). Offshore wind turbines
foundations can also affect benthos-organisms living in the sediments at
the sea bottom,through changes in the substrate and subsequent changes
in the species composition of the benthos and the existing biodiversity in
the area (EWEA, 2009; Köller et al 2006).
Impacts of wind energy on water are not very significant. In areas with
little rainfall, wind farms may require the use of a small amount of water.
If rainfall is not sufficient to keep the turbine blades clean, water is used
to clean dirt and insects off the blades so that turbine performance is
not reduced. Wind turbines do not discharge any water while producing
electricity.
Finally, the use of scarce raw materials may also be an issue if we con-
sider the use of neodynium in high performance magnets used in wind
turbines generators (Köller et al, 2011).
2.5.5 Hydro
Hydropower is generated from water moving in the hydrological cycle
from higher to lower elevations. Hydropower plants are often classi-
fied in three main categories according to operation and type of flow:
Run-of-river (RoR), storage (reservoir) and pumped storage HPPs. A
RoR HPP draws the energy for electricity production mainly from the
available flow of the river. In hydropower projects with a reservoir, the

generating stations are located at the dam or further downstream con-

nected to the reservoir through tunnels or pipelines. In pumped storage
plants water is pumped from a lower reservoir into an upper reservoir
during off-peak hours and the flow is reversed to generate electricity
during the daily peak load period.
Dams are constructed for several purposes and have several benefits for
society. While the main one is water supply for domestic or industrial uses,
other key purposes and benefits include: irrigation for agriculture, flood
control, inland navigation and recreation (ICOLD, 1999).
Most of the impacts of the hydro fuel cycle are direct burdens on
aquatic and terrestrial ecosystems.
IEA (1998) has identified several sensitive issues that need to be care-
fully assessed and managed to achieve sustainable hydropower projects.
Some of these aspects are:
● Hydrological regimes: a hydropower project may modify a river’s

flow regime if the project includes a reservoir which significantly
affects natural aquatic and terrestrial habitats in the river and along
the shore.
● Reservoir: the creation of a reservoir transforms a terrestrial
ecosystem into an aquatic one and a fast-flowing water course
into an artificial lake generating some impacts such as erosion
in the reservoir shorelines, changes in fish habitats and species
compositions, etc.
● Water quality in the reservoirs: in the deeper anaerobic layers
of large reservoirs many biochemical reactions may take place
leading to a change in the nutrient balance of the reservoir and
eutrophization.
● Increased sedimentation due to reduction in the sediment carrying
capacity of the water body.
● Biological diversity effects due to the permanent loss of habitats,
fluctuating water levels, downstream floods, introduction of exotic
species and obstacles to fish migration.
● Public health impacts through increases in waterborne diseases.
Life cycle greenhouse gas emissions of hydropower plants are very vari-
able depending on the technology and on the special characteristics of
the location of the power plant. The main emissions of atmospheric pol-
lutants associated with hydro schemes arise from the manufacturing and
construction of the generation and transmission equipment including the
dam (IEA, 1998). The majority of lifecycle GHG emission estimates for
hydropower cluster between about 4 and 14 g CO2eq/kWh, but under

certain scenarios there is the potential for much larger quantities (more
than 160 g/kWh) of GHG emissions (Kumar et al, 2011).
Hydropower creates no direct atmospheric pollutants or waste during
operation, and GHG emissions associated with most lifecycle stages are
minor (EC, 1995d). However, under certain conditions, CO2 and methane
(CH4) emissions from reservoirs from the degradation of flooded veg-
etation might be substantial. Research suggests that emission levels in
cold and temperate climates are generally low, and that elevated emis-
sions may be observed in some tropical systems with persistent anoxia
(UNESCO/IHA,2009). Decommissioning of the power plant can cause
also important GHG emissions from the silt collected over the life of the
plant.
There is evidence that the presence of massive bodies of water has
influenced the geological stability in the local region around dams increas-
ing the occurrence of earthquakes (IEA, 1998). The presence of large
water bodies will affect the local climate, with higher humidity and fog
formation in temperate climates.
Lastly, large dams can also have visual intrusion impacts (IEA, 1998)
which are site specific.
2.5.6 Ocean energy

The ocean energy resource comes from six distinct sources:
● Waves
● Tidal
● Tidal currents
● Ocean currents
● Ocean Thermal Energy Conversion (OTEC)
● Salinity gradients (osmotic power).
Due to the scarce deployment and operation of ocean energy technolo-

gies there is little information regarding their anticipated environmental
impacts.
Ocean energy does not directly emit CO2 during operation. Life cycle
emissions of GHG gases and other pollutants arise in the stages of con-
struction, maintenance and decommissioning of the installation, including
the emissions produced in the processes of manufacturing all the necessary
components and in the extraction of all required raw materials. Lifecycle
GHG emissions quantifications from wave and tidal energy systems are
scarce but from the available studies (Sorensen and Naef, 2008; Lewis
et al, 2011) they seem to be less than 23 g CO2eq/kWh, with a median
estimate of 8 g CO2eq/kWh for wave energy.

A description of potential local environmental effects is given by

Boehlert and Gill (2010) and Lewis et al (2011). Negative effects may
include:
● reduction in visual amenity;

● loss of access to space for competing users;
● noise during construction;
● noise and vibration;
● electromagnetic fields;
● disruption to biota and habitats;
● water quality changes and possible pollution;
● water salinity and sediment movements in estuaries;
● moving parts may harm marine life;
● changes in the regional properties (temperature and nutrient charac-
teristics) of seawater.
3 METHODS TO QUANTIFY ENVIRONMENTAL

IMPACTS
3.1 Life Cycle Assessment
Life Cycle Assessment is a method for systematic analysis of environ-

mental performance from a cradle to grave perspective. This analytic tool
systematically describes and assesses all flows that enter into the studied
systems from nature and all those flows that go out from the systems to
nature, all over the life cycle.
The interest in LCA started in the 1990s and since then a strong devel-
opment has occurred. The practice of LCA is regulated by the interna-
tional standard ISO 14040 and 14044 (ISO, 2006a, 2006b), and there are
several introductions (Guinée et al., 2002; JRC IES, 2010) and databases
(Ecoinvent, 2007) available.
LCA is a robust and mature methodology although some aspects are
still under development. A thorough review of the recent advances of the
methodology can be found in Finnveden et al (2009).
A complete LCA study consists of four steps:
1. Definition of the goal and scope of the study;

2. Life cycle inventory (LCI phase) where the collection of all the envi-
ronmental inflows and outflows takes place;
3. Life cycle impact assessment (LCIA) phase where the emissions and
resource data collected in the former phase are translated into indica-

tors that reflect environmental and health pressures as well as resource

scarcity; and
4. Interpretation of the results.
However, it is quite common that some LCAs only perform the inven-
tory analysis delivering a list of emissions or only evaluate some of the
impacts (like global warming impacts).
The purpose of LCIA is to provide additional information to help
assess the results of the LCI in order to better understand their envi-
ronmental significance. LCIA translates the inventory into potential
impacts on the “areas of protection” that are: human health, natural
environment and the man made environment (Udo de Haes et al, 2002).
LCIA attempts to model any impact from the product system that can be
expected to damage one or more areas of protection. In this sense, LCIA
addresses toxic impacts from air pollution and also other impacts asso-
ciated with emissions (global warming, stratospheric ozone depletion,
acidification, photochemical ozone and smog formation) and waterborne
effluents (eutrophization) as well as the environmental impacts of land
and water use, noise, radiation and depletion of resources (Finnveden
et al (2009).
3.2 Externalities Assessment
As explained in the introductory section of this chapter, all power genera-

tion technologies have some associated externalities – costs imposed on
individuals or the community that are not paid for by the producer or
consumer of electricity.
The most relevant project dealing with the determination of the exter-
nalities of energy is the European ExternE project (www.externe.info,
accessed February 2013) which was launched in 1991 by the European
Commission and the US Department of Energy. Since then, the European
Commission has continuously supported this research field through
several projects. The latest of these projects is the NEEDS Project (New
Energy Externalities Development for Sustainability, www.needs-project.
org/, accessed February 2013).
The ExternE methodology is widely accepted and considered as the
world reference in the field by the scientific community. The quantifica-
tion of the external costs is based on the “impact pathway” (IPA) method-
ology which was developed in the series of ExternE projects, and has been
further improved in the NEEDS projects and other related projects like
the EU CASES project (www.feem-project.net/cases, accessed February
2013). The impact pathway methodology aims at modelling the causal

relationships from the emission of a pollutant to the impacts produced on

various receptors through the transport and chemical conversion of this
pollutant in the atmosphere.
The principal steps of an IPA can be grouped as follows (EC, 2005):
● Emission: specification of the relevant technologies and pollutants,

e.g. kg of oxides of nitrogen (NOx) per GWh emitted by a power
plant at a specific site).
● Dispersion: calculation of increased pollutant concentrations in
all affected regions, e.g. incremental concentration of ozone, using
models of atmospheric dispersion and chemistry for ozone forma-
tion due to NOx.
● Impact: calculation of the dose from the increased concentration,
followed by calculation of impacts (damage in physical units) from
this dose, using a dose response function, e.g. cases of asthma due to
this increase in ozone.
● Cost: economic valuation of these impacts, e.g. multiplication by the
cost of a case of asthma.
In practice, ExternE uses LCA in combination with IPA (impact pathway

analysis) to get a complete assessment of external costs due to energy pro-
duction, including impacts that occur upstream and downstream of the
power plant itself.
Main receptors of the impacts are human health, crops, ecosystems and
materials and welfare losses produced by these impacts are assessed using
economic valuation methods.
Impacts categories, pollutants and effects considered in the ExternE
methodology are summarized in Table 16.1.
Seven major types of damages have been considered in ExternE. The
main categories are human health (mortality and morbidity effects),
effects on crops and materials as well as global warming.
Global warming impacts assessment is subject to a very high degree
of uncertainty. A good review of the literature on the economic impacts
of climate change can be found in Tol (2009). Within NEEDS, the
model FUND 3.0 was used to estimate the marginal external costs
of GHG emissions (Anthoff, 2007). Results greatly differ depending on
the assumptions regarding some very influencing parameters like dis-
counting and equity weighting. Two sets of externals costs factors were
used in NEEDS trying to reflect these uncertainty (Preiss and Friedrich,
2009).

Table 16.1 Impact categories, pollutants and effects considered in the

ExternE methodology
Impact category Pollutant Effects

Human health: PM10, SO2, NOx, O3 Reduction in life expectancy
Mortality As, Cd, Cr, Ni Cancer
Accident risk Fatality risk from traffic and
workplace
Human health: PM10, O3, SO2 Respiratory hospital admissions
Morbidity PM10, O3 Restricted activity days
PM10, CO Congestive heart failure
PM10 Cerebro-vascular hospital
admissions
Cases of chronic bronchitis
Cases of chronic cough in children
Cough in asthmatics
Lower respiratory symptoms
Pb Neurotoxicidad
O3 Asthma attacks
Symptom days
Benzene, Cancer risk (non-fatal)
Benzo-[a]-pyrene
1,3-butadiene
Diesel particles
Noise Myocardial infarction
Angina pectoris
Hypertension
Sleep disturbance
Accident risk Risk of injuries from traffic and
workplace accidents
Building SO2 Ageing of galvanized steel, limestone,
materials Acid deposition mortar, sand-stone, paint,
rendering, and zinc for utilitarian
buildings
Combustion Soiling of buildings
particles
Crops NOx, SO2 Yield change for wheat, barley, rye,
oats, potato, sugar beet
O3 Yield change for wheat, barley, rye,
oats, potato, rice, tobacco,
sunflower seed
Acid deposition Acid deposition Increased need for
liming

Impact category Pollutant Effects

Global warming CO2, CH4, N2O, Worldwide effects on mortality,
N, S morbidity, coastal impacts,
agriculture, energy demand,
and economic impacts due to
temperature change and sea level
rise
Ecosystems Acid deposition Acidity and eutrophication
Nitrogen deposition (avoidance costs for reducing areas
where critical loads are exceeded)
Source: EC, 2005.
4 SOME RESULTS
In recent years, remarkable progress has taken place in analysing environ-

mental impact and externalities of electricity generation thanks to several
major projects (EC, 2005; NEEDS project www.needs-project.org/; www.
feem-project.net/cases, accessed February 2013). LCA methodology has
also been extensively used to assess mainly GHG emissions but also
other emissions from the production and use of several biofuels of differ-
ent origins compared to conventional fuels. A good review of published
studies can be found in Menichetti and Otto (2009).
Some results on life cycle GHG emissions from several electricity gen-
eration technologies are shown in Figure 16.2. Results show that fossil
technologies, especially coal and lignite fired power plants, produce the
largest emissions. Results also show that non-combustion RE technolo-
gies and nuclear power cause comparatively minor emissions, only from
upstream and downstream processes. Among these technologies solar PV
power plants are the largest emitters.
Figures 16.3 and 16.4 show other pollutants’ life cycle emissions of
electricity generation technologies. Fossil fuel technologies and also
biomass technologies produce the highest emissions of NOx and SO2
followed by solar PV technologies. Oil and gas technologies produce the
highest amounts of NMVOCs emissions, followed by biomass technolo-
gies. In the case of particulates, solar PV technologies show the worst
results.
Results of GHG emissions from the production of biofuel – bioethanol

1,000 918 929
842
900 824
800 Construction Operation Dismantling Fuel
700 643
600
437 430
500
g/kWh
400
300
200 87 86 69 57
100 20 5 7 5 10 8 10
0
r T al C te C C T R e e e of e P P
lea G C i C C G O am ag or or ro ac SP H H
co G gn G G R C C
371
uc O d Li IG N N ,d or - sh sh , sp r, )C )
N ar lI do o st f- PV w
LG H oa ite y dr p on of r en la ps
c gn H y d, d , la So tra hi
d Li H um in in , op (s dc
ar p W W So s oo
H ro, r PV as
la (w
yd om s
H So Bi as
om
Bi
Source: CASES project (CASES, n.d.).
Figure 16.2 Lifecycle GHG emissions of electricity generation technologies disaggregated by life cycle stage

1,200
Nitrogen oxides Sulfur dioxide
1,000
800
600
mg/kWh
400
200
0
r T al C C C T R re re of e P P
lea G C ite C C G O am ge ro ac SP H H
co gn G d ra ho ho C
372
uc O d G IG G N R o s s , sp ,C )C )
N ar lI Li N o o, st n- ff- PV ar w
LG H oa ite yd y dr p o r en ol ps
c gn H H d, d ,o la op S tra hi
d Li pum in in (s dc
ar W W So V, s oo
H o, P as
dr ar (w
y ol om s
H S Bi as
om
Bi
Source: CASES project.
Figure 16.3 Lifecycle NOx and SO2 emissions of electricity generation technologies

300
PM < 2.5 um PM > 2.5 um NMVOC
250
200
150
mg/kWh
100
50
0
ar T al C ite C C T R ge re re of e P P
le G C C C G O am ro ac SP H H
373
O co IG gn IG G G R d ra sho sho ,
uc d Li N N o o, o sp ,C )C )C
N LG ar al ite dr st on- ff- PV ar w ps
H co yd y p ,o r p en ol tra hi
d gn H H d, d la S (s
Li pum in in So ,o s dc
ar W W V oo
H o, rP as
dr la (w
y om s
H So Bi as
om
Bi
Figure 16.4 Lifecycle particulate and NMVOC emissions of electricity generation technologies

and biodiesel – obtained by different authors in the literature are shown

in Figures 16.5 and 16.6. Dotted line on the graphs shows the reference
emissions for fossil fuels. In general, results show GHG emissions savings
for the vast majority of raw materials analysed, although some potentially
important issues such as LUC or ILUC effects are not considered in the
majority of the assessments. In the case of bioethanol production, sugar
based raw materials are better than starch based ones with sugar cane
showing the best results. In the case of biodiesel, the observed variability in
the results is quite remarkable, especially in the case of palm oil biodiesel.
Biodiesel from recycled oil followed by sunflower show the best results
with a high emission saving potential. However, as mentioned before, the
consideration of ILUC associated GHG emissions can have an important
impact on these results (Laborde, 2011).
Results for damage costs per kWh obtained in the CASES project are
shown in Figures 16.7 and 16.8 for various electricity generation technolo-
gies. As can be seen in those figures, results demonstrate that, compared to
fossil fuel technologies – especially oil and coal fired generation – renewable
energies have lower damages.
Fossil fuel technologies have external costs above 1.4 eurocent/kWh
reaching more than 3 eurocent/kWh in the case of coal power plants.
These costs are dominated by global warming impacts in the case of coal,
lignite and natural gas and by health effects in the case of oil. Among fossil
technologies, the ones with higher efficiencies have correspondingly less
external costs per kWh.
Despite nuclear energy external costs appearing as very low in these
calculations, it must be taken into account that they do not consider the
effects of a possible nuclear accident or the effects on future environment
and society of the possible accidental release of the nuclear waste that has
been disposed of (Lecointe et al, 2007).
Among renewable technologies, biomass technologies show the highest
external costs dominated by health and biodiversity effects while run of
river hydro technologies show the lowest costs among all the technologies.
Among solar technologies, solar PV technologies have sensibly higher
external costs than CSP and these costs are dominated by the health effects
arising from the emissions originated by the energy requirements of the
upstream processes related to the production of silicon and PV wafers
(Frankl et al, 2006). Foreseen improvements in energy consumption and
even better efficiencies for this technology would reduce the external costs
significantly.
External costs of fossil fuel power plants are dominated by impacts pro-
duced during operation of the power plants while renewable energies have
the most of their external costs associated with the construction stage of

375
gMJ-1
0
20
40
60
80
100
120
140
ETSU, 1996
ADEME, 2002
Elsayed, 2003
Low CVP, 2004
Quirin et al, 2004
Wheat
Edwards et al, 2007

IFEU, 2008
RTFO, 2008
RES Directive, 2009
Lechón et al, 2009
Shapouri et al, 2002
De Oliveira et al, 2005
Farrell et al, 2006
Grood and Heywood, 2007
Corn
Unnash and Pond, 2007
Wang et al, 2007
Zah et al, 2007
RES Directive, 2009
Macedo et al, 2004
De Oliveira et al, 2005
Smeets et al, 2006
Edwards et al, 2007
Unnash and Pond, 2007
Sugar cane
De Castro, 2007
Zah et al, 2007
Figure 16.5 Lifecycle GHG emissions of bioethanol production from different raw materials
RES Directive, 2009
ADEME, 2002
Elsayed, 2003
Gnansounou and Dauriat, 2004
Smeets et al, 2006
Edwards et al, 2007
Sugarbeet
Zah et al, 2007
RES Directive, 2009
376
gMJ-1
–50
0
50
100
150
200
Gover at al, 1996

lowest values reported.
Beer et al, 2001

ADEME, 2002
Elsayed, 2003
Quirin et al, 2004
Edwards et al, 2007
Beer et al, 2007
Rapeseed
Zah et al, 2007

Fehrenbach, 2008
RTFO, 2008
Lechón et al, 2009
ADEME, 2002
Quirin et al, 2004
Edwards et al, 2007
Sunflower
Lechón et al, 2009
Beer et al, 2007
1811 g/MJ
Zah et al, 2007

Fehrenbach, 2008
Palm oil
RTFO, 2008
Lechón et al, 2009
Sheehan et al, 1998
Beer et al, 2001
Zah et al, 2007
Fehrenbach, 2008
Soybean
RTFO, 2008
Figure 16.6 Lifecycle GHG emissions of biodiesel production from different raw materials
Lechón et al, 2009
Beer et al, 2001
Elsayed, 2003
Beer et al, 2007
Zah et al, 2007
Recycled oil
RTFO, 2008
Lechón et al, 2009
Note: The symbol ♦ represents the mean value of GHG emissions calculated by the authors in the references. Bars represent the highest and
3.5
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Figure 16.7 External costs of electricity generation technologies disaggregated by impact category

3.5
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Figure 16.8 External costs of electricity generation technologies disaggregated by life cycle stage

the fuel cycles. Fuel provision external costs are important in oil, coal and
gas technologies but also in biomass power plants. The nuclear fuel cycle
external costs are also dominated by fuel related activities.
5 CONCLUSIONS
This chapter has reviewed the environmental implications of a wide range
of different energy production technologies showing results for different
kinds of pollutant emissions, impacts as well as external costs calculations.
One relevant conclusion emerging from this review is that renewable ener-
gies can play an important role in mitigating global warming emissions, a
major concern in current environmental policy agendas. In terms of GHG
mitigation potential, some renewable technologies seem to attain robust
results in the reviewed studies, while others such as biomass derived elec-
tricity and biofuels show a more variable range of results. Of the latter
technologies, some aspects of concern are related to the associated indirect
effects produced by a large scale deployment. When mitigation of other
impacts and pollutants are included in the picture, some renewable tech-
nologies show higher potential than others. Once more, biomass technolo-
gies but also solar PV technologies have a lesser potential to contribute to
this mitigation.
When all of these effects are aggregated in a single indicator and are
quantified in monetary units, the social welfare benefits of deploying
renewable energy sources become clear. Consequently, if policy makers
want to promote and pursue a sustainable energy system that maximizes
social welfare, environmental externalities of all energy technologies must
be taken into account. In order to do so, it is necessary to properly iden-
tify, quantify and later internalize the external costs in the price of energy
through the various existing mechanisms.
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17. Washing away energy security: the
vulnerability of energy infrastructure to
environmental change
Cleo Paskal
1 INTRODUCTION1
Energy generation, extraction, refining, processing, distribution and deliv-

ery requires a complex, interlinked, costly and, sometimes, global infra-
structure. However, much of that infrastructure lies in areas that are
becoming increasingly physically unstable due to changes in the environ-
ment. Of particular concern are disruptions caused by, or exacerbated by,
environmental change.
Climate change is only one (albeit critical) component of the larger chal-
lenge of direct, man-made environmental change. Humans often make
direct and major alterations to the environment. Recently, for example,
massive population increases have had a dramatic effect on the physi-
cal environment. At the turn of the 20th century, there were around 1.65
billion people on the planet. At the turn of the 21st, there were around 6
billion. The result is more groundwater pumped up potentially creating
subsidence, more deforestation leading to erosion, more developments in
flood plains putting infrastructure in vulnerable location, etc.
As we push the boundaries of the carrying capacity of the planet, a
smaller degree of environmental variation has larger implications. As a
result, climate change may significantly exacerbate existing challenges,
but if there were no climate change, many of those challenges would still
exist. For example, the massive disruption created by Hurricane Katrina
in August 2005 was caused in large measure by problems with levee design
and implementation on the part of the US Army Corps of Engineers,
poor town planning, a failure of emergency services, and a breakdown
in the chain of command. This naturally dynamic coastal region was
going through a period of man-made environmental change, but much
of that change was more direct than the sort caused by climate change. It
included large-scale subsidence (in one area of New Orleans by about a
metre in three decades) probably caused, at least in part, by the draining
of wetlands, the extraction of groundwater and inappropriately designed
waterways.
386

Vulnerability of energy infrastructure to environmental change 387
Katrina can be used to show how poor regulations, planning and emer-
gency response can aggravate the environmental disasters that will almost
certainly increase as a result of climate change, but one cannot say that the
tragedy in New Orleans was caused by climate change alone. Similarly, the
massive disruptions caused to the US Northeast during Sandy (2012) were
exacerbated by major development in low lying regions known to flood.
Curbing climate change without addressing other environmental vulner-
abilities will not stop other ‘Katrinas’ and ‘Sandys’ (though it may keep
the number from significantly accelerating).
A key node for security is energy supply. When energy is knocked out,
there is a range of undesirable ancillary effects. So, within this matrix of
environmental change, it is critical to understand the myriad vulnerabili-
ties of energy infrastructure in this era of new variabilities.
When it comes to environmental change and energy infrastructure,
there are two separate, but often interlinked, challenges. One is inherited,
one is new. Both stem from the fact that energy infrastructure tends to
have a long lifespan. The Hoover Dam in the Western US, was completed
in 1935 and is still an important hydroelectric generator. China’s Three
Gorges Dam has an expected lifespan of at least 50 years. Nuclear power
stations, from design through decommissioning, may be on the same site
for 100 years. Additionally, constructions such as refineries, nuclear and
coal power plants, and high voltage transmission lines can be perceived as
undesirable to a community. As a result, when the time comes to build new
installations, they are often erected in the same locations as the previous
ones as the local population is already accustomed to the infrastructure.
This means that sites chosen in the 2010s may still be in operation in 2110
and beyond.
The lifespan of existing energy infrastructure is well within the time
frame predicted for potentially disruptive environmental change. When
much of it was installed, the degree of change was not understood and so
was not factored in to its design. This is an inherited challenge.
The new challenge involves upcoming investments. A substantial
segment of energy infrastructure in North America and Western Europe
is scheduled to be decommissioned in the coming decades due to revised
environmental standards and general age-related retiring. And in much
of the emerging world, major new builds are going in for the first time.
Combined with stimulus packages in some countries, and development
in others, it is likely that this is the beginning of an era of large-scale
investments in new infrastructure. In some cases, there is now the
necessary science to anticipate at least the minimum amount of environ-
mental change that can be expected over the next century (well within
the lifespan of most new investments). However, in too many cases,

roposed new builds still do not incorporate likely effects of environ-

p
mental change.
When planners talk about performing ‘environmental impact assess-
ments’, almost invariably what is being assessed is how the construction
would change the existing environment, not how a changing environment
might affect the construction. While engineers and planners may perform
a site inspection before designing an installation, they normally consider
the parameters of that site a constant, not a variable. The general assump-
tion is the coast won’t move, river levels will remain constant, the ground
won’t subside and precipitation will be confined to historic norms. Most
planners are not accustomed to, and often not trained for, incorporating
new environmental variables into designs. An added problem is that while
some change may be broadly predictable, there is likely to be wide vari-
ability in some areas, making precise projections impossible. The science is
improving, but there are still many unknowns and a lack of fine graining.
This in itself is sometimes used as a justification to avoid incorporating
any change at all.
The result is that one could erect a multi-billion pound, high-tech, envi-
ronmentally friendly installation in what will soon become a flood zone.
Not only will the original investment be lost, the destruction of the prop-
erty itself can cause new vulnerabilities.
It is no longer enough just to assess an installation’s impact on the envi-
ronment; one must also assess the impact of a changing environment on
the installation. Then, as much as possible, the impact of that change must
be integrated into planning and countered.
This chapter aims to add to that goal by identifying some of the most
susceptible nodes in the global energy infrastructure and showing how
they might be affected by moderate environmental change.
2 HYDROPOWER
The successful management of hydroelectric installations is contingent on

being able to predict in advance the volume of water entering the system.
Before construction, care is taken to assess river levels, hydrological cycles
and precipitation patterns. Until recently those data were considered to
be largely constants. For example, precipitation patterns might run on
decadal cycles, but the cycles themselves were considered largely predict-
able and dams, turbines and reservoirs were designed accordingly. As the
climate changes, what were constants are now variables. This causes prob-
lems for both primarily glacier-dependent and primarily rain-dependent
power plants.

2.1 Glacier-Dependent Hydro Plants
Hydroelectric installations, such as some in the Himalayas, Alps and

Andes that depend primarily on glacial melt, will likely face difficulties
in managing widely varying flows both seasonally, and over the years. In
Europe, mountain areas will likely see more flooding in the winter and
spring, and drier summers. These fluctuations can disrupt hydroelectric
power generation, erode infrastructure and damage valuable regional
industries.
Many glaciers are currently retreating, producing more run-off than
dams were designed for (SAARC Disaster Management Centre, 2008).
In China, for example, virtually all glaciers are in retreat and the start
of spring flow has advanced by nearly a month since records began
(Stern 2005, 78). The Chinese Academy of Science estimates that by
2050 as much as 64 per cent of China’s glaciers could have disappeared
(UNEP 2005).
One immediate impact of that melt is flooding. An estimated 50 new
lakes in Nepal, Bhutan and China have formed as a result of melting
glaciers. Glacial lakes can be unstable and liable to burst their banks, as
happened in Nepal in 1985 when one outburst washed away communities,
and a hydroelectric installation (UNEP 2005). It is also possible that in
areas that are already susceptible, the added geological stresses caused by
the new lakes could be the ‘last straw’ that triggers an earthquake (Gupta
Harsh 2002).
Eventually, once the glaciers reach a minimal extent, the flow may
markedly decline, creating a new set of challenges, including a potential
decline in hydroelectric production and increased competition with other
sectors, including agriculture, for the water itself.
2.2 Rain-Dependent Hydro Plants
Hydro plants that depend primarily on predictable seasonal rains, such

as many of those in India, will find it increasingly difficult to anticipate
flow, potentially causing power generation declines, floods and irrigation
problems.
Unexpected rainfall has already complicated the management of some
of India’s many dams (the country is one of the world’s major builder of
dams). In India, as in many other places in the world, dams often serve
three purposes: flood control, irrigation and power generation. Most
rain-dependent plants are designed to store water from the rainy season
in order to be able to irrigate and generate power in the dry season. Those
plans rely on predictable rain patterns. Some Indian dam managers are

working on monsoon schedules that assume regular 35-year rainfall

cycles. In 2008–2009 hydroelectricity generation in India saw an 8.42 per
cent decline compared to 2007–2008. By the summer of 2009, the shortfall
was 12 per cent. The loss was blamed on inadequate rainfall.2
The situation can be equally problematic when there is too much rain
for the design of the installation. If the reservoir fills during the rainy
season and then, due to changing precipitation patterns, the rain keeps
falling well into what should be the dry season, the reservoir can back up
and there will be a risk of inundating the villages upstream. If, in order to
prevent that, the dam’s floodgates are opened, the released water can add
to the already swollen river and flood the cities downstream.
It was just such a downstream flooding that happened in August
2006 to Surat, an Indian city with a population of over 3 million people
with a thriving economy as one of the world’s largest diamond cutting
centres. Unseasonably heavy rains overwhelmed dam management and
led to the sudden release of water from an upstream dam. The resulting
floodwaters covered around 90 per cent of the city and destroyed nearby
villages. Over a hundred people are known to have died, hundreds more
went missing, and disease spread as thousands of animals drowned and
rotted in the waters. The financial cost was at least in the tens of million
dollars and the loss of rare manuscripts from the city’s academic institu-
tions was incalculable (Mishra, 2006; Upadhyaya 2006; Thakkar 2006;
Patel 2006).
2.3 Other Factors
These flow extremes, especially when combined with other environmental

change factors such as deforestation, can cause erosion, subsidence, land-
slides and siltation, each of which can affect the efficacy and stability of
hydroelectric power plants.
There are added political complications. Disputes between states,
already concerned about power and water sharing, may only get worse
as water supplies become even more erratic and hydroelectricity becomes
less reliable. Additionally, Clean Development Mechanism financing
and the push for low carbon power generation generally is resulting in a
new era of dam building. A large percentage of all CDM projects are for
hydroelectricity. As of June 2012, 1,531 hydro projects in China alone
were registered or seeking registration with the CDM.3 Some projects are
well conceived. Others less so. It is critical that all new and existing plants
be assessed to determine how environmental change over the lifespan of
the dams will affect both their power generation viability as well as their
structural integrity.

3 NUCLEAR POWER
Nuclear power generation may also face challenges with ensuring output
and site security. Reactors usually require a large amount of water for
cooling. As a result, they are generally positioned in areas that are sus-
ceptible to environmental change: they are normally either on the coast,
making them increasingly vulnerable to sea level rise, extreme weather,
storm surges, and tsunamis; or they are on rivers, lakes or reservoirs and
are dependent on increasingly valuable, and variable, fresh water supplies.
Some installations have already been tested. There has been a degree
of flooding at nuclear power plants in the US, France and India. In 1992,
Hurricane Andrew caused extensive damage to the Turkey Point site in
Florida. An earthquake, but mostly flooding, caused by the resulting
tsunami, resulted in the meltdowns in Fukushima, Japan in 2011, the
largest nuclear disaster since Chernobyl (1986).
In the UK, many of the existing coastal power stations are just a few
metres above sea level. The Dungeness plant, in coastal Kent, is also built
on an unstable geological formation. The site already needs constant man-
agement to stay protected. Many of these installations are aging, and there
is momentum for new plants to be commissioned. However, as it is diffi-
cult to get communities to accept a nuclear power station in their region,
in many cases the proposal is for the new plants to be located on the same
sites as the old ones. The government has assured that builders would have
to ‘confirm that they can protect the site against flood-risk throughout the
lifetime of the site, including the potential effects of climate change’(BBC
2008). It is, however, difficult to estimate both the lifetime of the site (those
who built the installations that are there today did not factor in that new
ones would be going in beside them, markedly extending the lifespan of
the site), or the potential effects of climate change. For example, while
sea level rise and storm surges may be increasingly well-understood, other
disruptive factors, such as the possibility that changes in wave action could
liquefy coastal sands, are not (Savonis et al. 2008). Coastal environments
in particular are highly complex and unpredictable. Several times recently
coastal nuclear power plants have had to power down as their intake
valves were blocked by jellyfish, or ‘jellyfish-like’ animals. It happened
in 2006 in Japan, forcing an emergency powering down (BBC 2006a);
in 2011 in Scotland, where both reactors at Torness had to be shutdown
(Miller 2011); and in 2012 in California, causing Diablo Canyon plant
to cut production in one of its two reactors to 25 per cent of capacity
(Chawkins 2012).
Riverside plants have different problems. In Europe, cooling for elec-
trical power generation (including both nuclear and fossil fuel plants)

accounts for around one-third of all water used. However, in some areas
drought is reducing river, lake and reservoir levels at the same time as air
and water temperatures are increasing. The effect on any form of power
generation requiring a large amount of water (including coal powered
plants) is likely to be substantial. The same heat conditions that peak
demand will also increasingly result in some plants struggling to deliver.
The effects are already being seen. During Europe’s record-breaking
heat wave of 2003, temperatures reached more than 40 degrees Celsius
across the continent. In France, 17 nuclear reactors had to power down or
shut off, at a cost to Électricité de France of around €300 million (Kanter
2007). This was in spite of exemptions given allowing the plants to dis-
charge water hotter than normally allowed into ecosystems, potentially
disrupting other industries, such as fisheries.
The Hadley Centre predicts that, by 2040, heat waves like the one that
seared Europe in 2003 would be ‘commonplace’.4 Additionally, as the
average ambient temperature rises along with energy demand, the system
may spend more time close to its limits and smaller events may result in
shutdowns. The summer of 2006 was not as hot as 2003, but again France,
Spain and Germany all had to power down nuclear plants because of heat
and water problems (Jowit and Espinoza 2006). And in July 2009 France
lost almost a third of its generation and had to buy power from the UK. A
2012 study published in Nature Climate Change projects:
a summer average decrease in capacity of [thermoelectric, nuclear and fossil

fueled] power plants of 6.3–19% in Europe and 4.4–16% in the United States
depending on cooling system type and climate scenario for 2031–2060. In
addition, probabilities of extreme (.90%) reductions in thermoelectric power
production will on average increase by a factor of three. (van Vliet et al. 2012)
Given the high cost, long lifespan and potential for damage to nuclear
power plants, it is essential that substantially more research be done on
how they will interact with an increasingly volatile global environmental
system.
4 OFF-SHORE/COASTAL PRODUCTION
As easier to access oil and gas sites are depleted, more difficult off-shore
and coastal production may gain in importance. Off-shore and coastal oil
and gas extraction is accomplished under a wide range of conditions, from
the tropics to the tundra. The challenges vary depending on the location.
In order to assess the variety of risks, case studies of the uncertainties in
the Gulf Coast of the United States and the Arctic are instructive.

4.1 US Gulf Coast
Gulf of Mexico federal off-shore oil production accounts for 23 per cent
of US crude oil production and federal off-shore natural gas produc-
tion accounts for 7 per cent of total US dry production. The Gulf coast
also contains over 40 per cent of US petroleum refining capacity and 30
per cent of US natural gas processing capacity (US Energy Information
Administration, 2012).5
Climate change projections anticipate the US Gulf Coast will see
increased flooding and extreme weather events. Storm activity has already
affected supply. In the summer of 2005, Hurricane Katrina shut what
amounted to around 19 per cent of the US’s refining capacity, damaged
457 pipelines, and destroyed 113 platforms.6 Oil and gas production
dropped by more than half, causing a global spike in oil prices. Over the
course of that year, close to three months of production was lost (Muller
2012). Much of the on-shore support infrastructure destroyed in 2005 was
rebuilt in the same location, leaving it vulnerable to similar weather events.
In the summer of 2008, Hurricanes Gustav and Ike passed through the
Gulf and destroyed 60 platforms. Interestingly, even before the hurricanes
arrived, the economic effect was felt. What amounted to almost 10 per
cent of US refining capacity, as well and much of off-shore Gulf produc-
tion, was shut down in preparation for the hurricanes. The same thing
happened again in 2012 when Isaac shut down most of the Gulf platforms
and refining capacity (Morath 2012). This shows that even just the threat
of extreme weather can affect supply and price. Climate change predic-
tions imply that this sort of disruption is likely to become more common.
There are also other potential impacts. While most pipelines are buried,
and so seemingly insulated from the effects of severe weather, there are nodes
of exposed vulnerabilities, such as pumping stations and valves that can be
affected. Also, it is uncertain how changes in water tables, soil structure,
stability, erosion and subsidence might affect the pipelines.7 Understanding
how, or if, those factors may affect supply will require more research.
4.2 Other Low-Lying Coastal Facilities
Many of the world’s largest oil and gas facilities (including Ras Tanura,
Saudi Arabia; Jamnagar, India; Jurong Island Refinery, Singapore;
Rotterdam Refinery; and major installations in the Niger Delta) are only
slightly above sea level. This leaves them vulnerable to rising sea levels,
storm surges, increasing storm activity, subsidence and changes in ground
composition. If even one of these regions is affected, it could affect local
security and global supply and markets.

4.2.1 Arctic
The US Geological Survey estimates that the Arctic might contain over
one-fifth of all undiscovered oil and gas reserves.8 One study postulated
that Siberia could contain as much oil as the Middle East (Chalecki
2006). However, dreams of a resource bonanza in the north are prema-
ture. The environment is difficult and becoming increasingly unpredict-
able. Norway’s northern Snohvit gas field cost 50 per cent more than
the original budget and, in the fall of 2006, North Sea storms sank a
155-metre Swedish cargo ship and caused one oil rig to break away
from its tow and be set adrift off the coast of Norway (BBC 2006b, IHT
2005). As one North Sea oil industry executive said: ‘we’ve had our third
“one-in-a-hundred-years” storm so far this year’.9
There are likely to be higher waves, increasing storm activity and
more icebergs threatening off-shore rigs and complicating shipping (BBC
2006b, IHT 2005). Additionally, with warmer and wetter air freezing and
thawing more often, ships, aircraft and infrastructure icing will become
more common.10 Also, many key elements of production, such as how to
contain an oil spill in Arctic waters, are poorly researched. This is a highly
complex operating environment. In 2012, Shell announced it was delaying
its Alaskan Arctic drilling after a testing accident (Krauss 2012). All of this
could result in high insurance costs, hampering exploration.
5 ENERGY PRODUCTION AND DISTRIBUTION IN

COLD CLIMATES
An additional problem for off-shore Arctic energy extraction is that

on-shore Arctic energy infrastructure is likely to suffer substantial damage.
Coastal areas are already seeing more erosion and are weathering stronger
storm activity. However the biggest problem may be the thaw of the
permafrost.
Permafrost, essentially permanently frozen land, acts as a solid founda-
tion for infrastructure in cold climates. It covers around 20 per cent of
the planet’s landmass, including large areas of Russia, parts of the Alps,
Andes and Himalayas, and almost half of Canada. Many of these are
energy production regions. These are also regions of energy transmis-
sion and distribution. The Trans-Alaska pipeline alone carries as much
as 20 per cent of the US domestic oil supply.11 As temperatures rise, the
permafrost thaws. The ice trapped inside the frozen ground liquefies. If
there is poor drainage, the water sits on the earth’s surface and floods. If
there is good drainage, the water runs off, potentially causing erosion and
landslides.

Thawing permafrost has the potential to severely affect infrastructure

in the north. Linear installations such as pipelines, electrical transmis-
sion line and railways are only as strong as their weakest point. If one
section is destabilized, the entire supply can be disputed. Already in some
cold climates, pipelines, roads, ports and airports are at risk of imminent
structural damage and possible permanent loss. In Alaska, complete
Arctic communities are being relocated. One of China’s top permafrost
experts who was involved in the multi-billion dollar, state-of-the-art Tibet
railway, built in part on hundreds of kilometres of Himalayan permafrost,
was quoted as saying ‘Every day I think about whether the railway will
have problems in the next ten to twenty years.’ (Wolman 2006). While the
railway is still in operation, sections of the foundation started sinking not
long after it was opened (Mishra 2007). Often these problems can be engi-
neered around, but they can add substantial cost and affect performance.
Construction and repair is also being affected. In cold climates, heavy
equipment is often moved in the winter when the ground is most solid.
With warming, that window is shortening. In some areas of Alaska, for
example, the number of days per year heavy equipment can be driven on
the tundra has halved.
Not only does environmental change create challenges for new cold
climate resource extraction, existing installations that rely on iceroads,
waste containment and pipelines built on thawing permafrost may need
to be reassessed. In August 2006, a BP pipeline in Alaska corroded and
broke. While not a direct result of environmental change, it gave an
indication of the sort of vulnerabilities that may become more likely if
thawing permafrost undermines pipelines. The line carried close to 2.6 per
cent of the US daily supply and the closure created an immediate spike in
oil prices and gas futures. The US government considered releasing emer-
gency stockpiles and the Alaskan government faced a financial crunch
(Pemberton 2006).
The stability of cold climate infrastructure is often overestimated. For
example, with the retreat of Arctic sea ice a shipping route from Russian
to Canada, through the Northwest Passage, has been proposed. Russia
has offered to keep the Canadian section of the route open past the
summer season with icebreaker convoys. The proposed Russian terminal
is Murmansk. The proposed Canadian one is Churchill, Manitoba, on
Hudson Bay. Shipping via Churchill can cut hundreds of kilometres off
transit routes between Russian and the US Midwest. Under the plan, grain
is the main proposed cargo, however fossil fuels could also join the route.
Some in Ottawa support the plan. However Churchill is only land-
linked to the rest of Canada by rail (there is no road) and the railway,
built in many places on permafrost, is already suffering from deteriorating

tracks. There have already been derailments and at times in the summer
the train can’t travel faster than 10km an hour. This is an example of reali-
ties on-the-ground undermining economic and strategic analyses made in
distant locations.
With environmental change, infrastructure problems in cold climates
are likely to become more common. This section has looked primarily at
permafrost, but there are many other challenges as well. For example, it
used to be that in places such as parts of the northern United States and
southeastern Canada, once winter came, it stayed below freezing until
spring. Now, with rising temperatures, it warms and freezes, and warms
and freezes. This opens up the possibility for more periods of freezing rain,
and ice storms, like the one that cut the power off for millions in the winter
of 1998.
It is going to take a major investment in permafrost and cold climate
engineering research to finds way to rebuild Arctic and cold climate infra-
structure in a manner that is viable over the long term.
6 OTHER CAUSES OF DISRUPTION
Any extreme weather event can extensively impair power delivery, and
there are global predictions for an increase in those kinds of disasters. One
UK government report, commissioned after the costly summer floods of
2007, found that potentially hundreds of UK substations are at risk of
flooding (Shukman 2008). The wake-up call came that summer when a
switching station near Gloucester, servicing around 500,000 homes and
businesses, came within inches of being flooded.
Given the interconnected nature of global systems, and an increased
reliance on just-in-time deliveries, unexpected failures are also appear-
ing. During the Icelandic ash cloud incident of 2011, flights stopped to
Scotland. Scotland’s only refinery simultaneously refined multiple types
of fuel. As jet fuel wasn’t required due to the grounded flights, and there
was little storage capacity as it had never been needed, the refinery came
very close to having to shut down all refining because it couldn’t off-load
its jet fuel.
We are also seeing an increase in complex catastrophic failures, such
as when Sandy hit the Northeastern US in 2012. Power stations shut
down, critical installations flooded, powerlines came down, key personnel
couldn’t get to work, and more.
Extreme and unexpected events of all sorts are likely to become more
common, jeopardizing energy security and, by extension, human and even
potentially national security as well.

7 RENEWABLE ENERGY GENERATION
Every form of energy generation, including renewables, and every installa-

tion site chosen should be evaluated for stability in times of environmental
change. For example, while solar plants may seem immune from disrup-
tion as long as the sun transits the sky, if they are built on flood plains,
they can be rendered useless at the first heavy rain. Wind farms should
assess if long-standing air currents may shift or if the hills they are often
built on are likely to erode or suffer from landslides. Tidal generation
should incorporate the effects of sea level rise, erosion, storm activity and
so on. Just because an energy source is ‘green’ doesn’t mean it is sustain-
able under environmental change conditions.
8 ENVIRONMENTAL CHANGE CAUSING

ECONOMIC RECALCULATIONS
The clearest example of how energy supplies may be affected by a reevalu-

ation of cost is how all of the above-mentioned disruptions (or even the
potential for disruption) may affect insurance costs, potentially impairing
the economic viability of certain investments.
Adding to the challenge is the fact that throughout our systems, real risk
is being distorted, discounted and disguised. Potential market-based safety
mechanisms, like insurance, are being undermined by politically expedient
initiatives like the US’s bankrupt National Flood Insurance Program, and
‘investment friendly’ initiatives such as caps on liability, both of which
essentially offset the risk from the individual region or sector onto the
population as a whole – and almost incidentally allow for critical pieces
of energy infrastructure to be placed in highly vulnerable locations. For
example, building a nuclear power plant in an earthquake and tsunami
zone makes no sense from a physical reality perspective. However,
that risk assessment was trumped by Japan’s perceived domestic, eco-
nomic and political imperatives. It was an illusory trade-off however, as
Fukushima has done more to damage Japan’s domestic, economic and
political imperatives than choosing another location ever would have.
Similarly, draining swampland in a hurricane zone like New Orleans to
put up housing and critical infrastructure might make sense to developers
and to the city officials that approve the plans for reasons of their own, but
from a physical reality perspective, it is nonsensical. As was allowing BP
to self-insure the Deepwater Horizon when insurance companies – some
of the best in the world at assessing real physical risk – would not insure
it. The problem is, those costs are adding up, and the public purse is

increasingly light. As the environment changes, it will seem like we are

building, and rebuilding, and re-rebuilding, sandcastles below the high
tide mark. Something will have to give – either energy security, or the way
risk is currently being assessed.
Other factors may change calculations as well. For example, if predic-
tions of increasing water scarcity hold true, fresh, clean water may sub-
stantially increase in value. This would force a re-evaluation of the real
cost of not only of hydro and freshwater-cooled nuclear installations, but
of fossil fuel extraction and refining technique that contaminate water that
could otherwise be used for drinking and irrigation.
Already China has abandoned or suspended the vast majority of its
coal-to-liquid projects in part over concerns about water availability.
Another potential area of concern is Canada’s oil sands. The method of
extraction used in the oil sands requires and contaminates large amounts
of water. Currently Canada is perceived to have abundant fresh water,
however the vast majority of that is non-renewable fossil water (once
contaminated it is lost and not regenerated), and even that will be under
increased stress in some regions as the climate shifts. Already there are
concerns about water quality in some of the communities that share river
systems with the oil sands. Apart from the domestic value of fresh water
availability, ensuring a stable supply of fresh water for agriculture in
Canada has wider implications. It is increasingly likely that, as other areas
of the planet, such as Australia, become less fertile, Canadian agriculture’s
contribution to global supply will gain in relative importance, and so
energy security may come in direct competition with food security.
9 GEOPOLITICAL FACTORS
Many of the potential disruptions mentioned could engender a political

response. For example, in the case of Russian pipelines being undermined
by thawing permafrost, if the engineering required for stabilization proves
too costly, Russia might switch increasingly from pipelines to tankers,
allowing them much more flexibility in delivery and subjecting the supply
to greater politicization.
It is also possible, though quite controversial, that an increasingly
parched US will look to Canada to supplement its water deficiencies. In
some areas of the US, such as the agricultural belts and water-scare cities
such as Las Vegas, water security might become more important than oil
security. Other forms of energy may be found, but it is more difficult to
find other forms of water. In that case, US energy security policy (which
has been supporting the water-polluting Canadian oil sands) might come

into conflict with US water and food security policy (which would benefit
by ensuring that an increasingly accessible supply to the north is not
contaminated).
Another politics-of-water related problem that might affect energy
supply could come about when dam building deprives one group, region
or country of their expected supply of fresh water. It is possible that,
should some become desperate enough as a result of increasing water
scarcity, there could be attacks on the installations themselves. The goal
would be to destroy the dam in order to secure water supply downstream.
10 CONCLUSION
There are concerns about both older installations not being designed for
new conditions and new installations not integrating change into their
planning. Either of those situations can result in marked decreases in
energy output and risks to the installations themselves. That in turn, could
affect energy prices and global security. Volatile energy prices have the
potential to destabilize major economies.
Many of the challenges outlined above can be overcome with sufficient
research, planning, engineering and financing. In some cases, it may even
be possible to integrate change into planning in such a way that energy
output increases with changes rather than decreases. For example, hydro
installations in regions that are expecting higher rainfall could be designed
to eventually take advantage of that excess flow, rather than be over-
whelmed by it.
However, the reinforcement of global energy infrastructure is unlikely
to happen overnight. It will take:
● an acknowledgement that the problems are real, integrated and wide

ranging;
● the will to counter them;
● appropriate investment in research on potential impacts, assessment
of real risks, and engineering and design solutions;
● implementation; and
● continuous reevaluation to ensure they are keeping up with environ-
mental change predictions.
It is in the best interest of those concerned with energy security, such as

national governments and the business community, especially the energy
and insurance industries, to ensure this happens as quickly as possible.
Until it does, it is to be expected that there will be increasingly frequent

disruptions to energy supply, potentially in multiple locations and sectors

at the same time. The economic, social and political costs are likely to be
substantial.
At the same time, it may make sense to focus on building a more decen-
tralized energy structure, preferably based on locally available renewables
situated in secure locations. A degree of regional energy self-sufficiency
could provide a better defence against the sort of large-scale outages that
result when centralized power systems are compromised. This sort of
regional, network-based system might also prove more flexible and adap-
tive, and therefore more able to cope with the increasing variability and
unpredictability caused by environmental change.
Finally, it is worth remembering that energy infrastructure is often
among the best funded, planned and maintained installations available.
The challenges that even this well-supported sector will face are an indica-
tion of the vulnerability of other large sections of the critical infrastructure
that support our economies, security and lives.
NOTES
1. This chapter was updated and expanded from Cleo Paskal, ‘The Vulnerability of Energy
Infrastructure to Environmental Change’, a joint publication of Chatham House and
the Global Energy and Environment Strategic Ecosystem of the Department of Energy,
July 2009.
2. ‘Power generation growth plummets to 2.71% in FY’09’, Times of India, 9 April 2009.
3. See http://www.internationalrivers.org/resources/spreadsheet-of-hydro-projects-in-the-
cdm-project-pipeline-4039 (accessed 12 September 2012).
4. See http://www.metoffice.gov.uk/climatechange/science/explained/explained1.html.
5. ‘Gulf of Mexico Fact Sheet’, US Energy Information Administration, http://www.eia.
gov/special/gulf_of_mexico/ (accessed 10 November 2012).
6. See http://www.mms.gov/ooc/press/2006/press0501.htm.
7. Impacts of climate change and variability on transportation systems and infrastructure:
Gulf Coast Study, phase 1, 4–37 to 4–43.
8. See http://www.usgs.gov/newsroom/article.asp?ID51980&from5rss_home.
9. Private conversation.
10. ‘Naval operations in an ice-free Arctic Symposium’, Office of Naval Research,
Naval Ice Center, Oceanographer of the Navy and United States Arctic Research
Commission, 2001, http://www.star.nesdis.noaa.gov/star/documents/2007IceSymp/
FinalArcticReport_2001.pdf (accessed 5 March 2013).
11. ‘Climate change in the Arctic and its implications for U.S. national security’ (Chalecki
2007).
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18. Paradoxes and harmony in the
energy-climate governance nexus1
Stéphane La Branche
Limits of survival are set by climate, those long drifts of change which a
generation may fail to notice. And it is the extremes of climate which set the
pattern. Lonely finite humans may observe climatic provinces, fluctuations of
annual weather and occasionally may observe such things as ‘this is a colder
year than I’ve ever known’. Such things are sensible. But humans are seldom
alerted to the shifting average through a great span of years. And it is precisely
in this alerting that humans learn how to survive . . . They must learn climate.
Children of Dune, Frank Herbert (Orion, 1976, 350)
INTRODUCTION2
As early as 2008, climate change was seen by most international organisa-

tions as both the number one accelerator and amplifier of natural risks
and the single most important obstacle to development efforts in the third
world. This position has been reinforced since, driven home by new empir-
ical data and studies from almost all disciplines. In the academic, public,
economic and political spheres, climate change (CC) is raising deep issues
about the economic structure of our society, debates and theorisation
regarding post-carbon or non-carbon based production and consump-
tion (or the green economy). Even a cursory look at this book shows how
highly complex the interconnections between energy and climate govern-
ance can be. These links give some indications that CC is slowly insert-
ing itself into every aspect of our societies.3 Indeed, our argument is that
climate governance is becoming a meta-governance, redefining, modifying
and inserting itself into already existing ones.
But this movement toward a (climate) meta-governance encounters
another primordial issue: the emerging global energy (in)security that is
both due to ‘classical’ (due to peak oil and increased demand) and ‘non
classical’ factors, such as restrictions imposed on carbon-based energy due
to environmental efforts, especially CC, which creates an ‘artificial’ rarity.
But, while climate governance and energy governance can indeed go in the
same direction, they also can be at odds. From an analysis of institutional
texts and reports and social science academic papers (national, European
402

Paradoxes and harmony in the energy-climate governance nexus 403
and international institutional reports, see bibliography) on the issue of

climate and energy governance, I will explore the interactions between
these two governances by focusing on areas of probable and already exist-
ing tensions. The exercise is not straight forward for several reasons: the
transversality of the double energy-climate issue increases their complex-
ity and both governances exist at different scales of analysis and in very
diverse institutions. First, I need to develop that CC is, potentially at least,
becoming a meta-governance aimed at managing climate as a meta risk.
CLIMATE CHANGE: FROM META RISK TO. . .
In 2008, the International Panel on Climate Change (IPCC) received the

Nobel prize for Peace, not science, because of the probable impacts of
CC on our civilisation: changes in food production and water availabil-
ity will lead to increased hardships for the poor and vulnerable, migra-
tions, increased geopolitical tensions for resources and regional conflicts.
Climate change has indeed emerged, for international organisations, as
an international security issue. An American think tank working for the
US Army has even declared CC as the number one security issue for the
country in the 21st century, before terrorism (CNA 2007). CC has even
helped redefine the security agenda setting and framing – especially those
issues linked to the coming energy crisis . . . Furthermore, Wanneau (2011)
showed how CC has even influenced security theory, forcing it to come
out of its economic-military power analytical framework to broaden and
take into account other non-classical issues. At the same time, from 2005,
concerns for energy security and availability especially to the poor also
increased. But while CC has really risen on the international political scene
since the end of the 1990s, in most countries, it has emerged as a social and
political reality since 2005 or so (depending on the country, the adminis-
tration, or the region).
2005/6 was indeed a clear turning point, when climate and energy issues
were explicitly and integrated in different international norms and decla-
rations such as the UN’s Millennium Development Goals (in 2005), the
World Bank’s development approach, water management and risks, as
well as insurance policies, construction norms and urbanism. Note that
in 2007, the UNDP’s Human Development Report was subtitled: fighting
climate change.
These issues thus started to be slowly redefined, reworked, reconceptu-
alised, re-practised (and even re-taught in our teaching institutions) with
climate and energy objectives in mind. While approaches to energy used to
focus on energy supply, security and access, they now add its sustainability

(and climate friendly), its role in health, education and access to clean
water . . . But an even more fundamental change is that energy has ceased
to be considered as a cheap, quasi infinite resource, without impacts on the
ecosystem. Energy is now seen as an issue that needs to be tackled, planned
for and managed. Energy as we know it and use it is no longer without
environmental consequences, nor is it infinite nor cheap. In many texts, a
link is made to the fact that the most vulnerable and poorest groups will
be most adversely affected by CC, which will increase their vulnerability to
natural hazards and decrease their capacity for development, for improv-
ing their quality of life and for adapting to CC impacts. Increased cost and
decreased access to energy will mean a decreased capacity for coping with
other difficulties and challenges, including the additional ones created by
CC. All these issues, with their associated governance systems, are both
affected by the ‘objective’ reality of CC (as evaluated by natural sciences)
and by the social and ‘subjective’ efforts (as analysed by the social sci-
ences) at dealing with it and managing it – i.e., governance. Indeed, the
emergence of climate (meta) governance is less closely tied to its natural
aspects than it is to its social, economic and political dimensions – which
are even more complex – and which are intrinsically tied to energy.
Underlying these evolutions is the understanding among institutions
that CC has become a meta-risk: while CC as such does not create new
risks, it is seen as the risk above (and beyond) all others, in that it modifies
and amplifies existing ones, such as floods, avalanche, droughts, waterfalls
and storms and their consequences on food production and development
efforts in the third world. For UNEP:
climate change is every bit as alarming as any of the threats facing humanity,
and probably more alarming than most, because – without drastic change – its
impacts appear certain . . . What is at issue is not comfort, or lifestyle, but sur-
vival. Food security is at stake, climate refugees might hamper political secu-
rity, and more uncomfortable changes will put humanity under strain. (UNEP
2008, 23)
In the 19990s water was declared by international institutions to be the

second millennium’s foremost issue. It is no surprise that it was replaced
by climate at the turn of the century.
My reviews of studies on international, national and local climate gov-
ernance indicate that the initial insertion of climate issues in natural risks
and management has been spreading in the last 10 years to almost all other
dimensions of human activity. Indeed, during the same period (2006–08),
energy and climate issues started being integrated at the national and local
levels into urban development planning (and theories) in some cities (it is
now more widespread, with thousands of cities networking to fight and

adapt to CC), construction goals and methods, agriculture, transports and

to a much lesser degree, consumption (carbon footprint labels are a much
more recent phenomenon in only some industrialised countries). Thus,
CC first appeared as a meta-risk and then as the number one obstacle to
development efforts and thus, very quickly, as a multi-stake, multi-issue
governance problem at all levels – as an emerging meta-governance,
perhaps? As such, it would be wrong to speak of an international climate
regime since this notion is linked to a general governance mode linked to
a specific issue. CC and its impacts are not issue-specific, they touch on
every human activity – an anthropogenic issue.
The importance of the social, political and institutional dimensions of
CC appears even more strongly in adaptation. Recent studies on adapta-
tion to CC show that the most important factors playing a role in climate
resilience (the capacity of a society to adapt to CC) are not natural factors
(such as increased droughts or floods) but those social, institutional, polit-
ical and economic factors that play a role in a society’s capacity at prepar-
ing for and responding to climate-induced changes. This is leading to deep
changes in how the developing world attempts to develop (influenced by
the climate resilient and climate proof development approaches of the
large international development institutions, with many national develop-
ment agency following the lead). But the social factors playing a role in
adaptation to CC are even less well understood than natural factors. It is
really only in the last few years that the international scientific community
has begun recognising the importance of social issues: the IPCC’s 5th
report (due in 2013) will focus on the economic and social dimensions of
CC for both mitigation and adaptation. Hence, the emerging idea that CC
is secondarily a hard science issue and increasingly, a social science one.
The climate issue is having a direct effect on research and academic institu-
tions, going beyond a simple effect on political speeches and having a real
discursive effect in Foucault’s sense of the term: becoming a truth, with
its mechanisms and apparatus (Foucault 1980) and thus having effects on
actual daily operations of institutions, companies, administrations and
research.
. . . TO CLIMATE (META) GOVERNANCE?
The different examples given point to an emerging climate meta-

governance. When I first started working on this issue, in 2008, it was in
the framework of a prospectivist exercise, very rare in political science. I
worked from weak signals, probable indications and signs of what might
be emerging. In the last few years, these have all become strong signals;

the unlikely, more probable; the ‘probable’, more certain and emerging
trends have become more mainstream. Now, examples abound: water,
natural risks, insurance, urbanism, transports, biodiversity, security,
housing, research, development, public policies, health, economic devel-
opment, agriculture, cultural norms . . . are all being re-defined by the
climate issue either for mitigation or for adaptation. Even the research
world has been affected by this movement: when one looks at the different
calls for research in different fields, more often than not a CC dimension
has to be integrated in the project and one’s chance of getting funding
increases if one adds a climate dimension. My different studies in my
research programme on climate governance all suggest very strongly that
CC is emerging as a new type of ‘total’ governance through three different
means:
1. it is inserting itself in issue and sector-specific governance, as well as

individual values and legal international, national and local norms;
2. it tends to redefine these types of governance, from above, as an over-
arching framework and;
3. it is diffusing through sectors in a transversal manner and from below
(global and local civil societies).
For example, in the last few years, urban projects in most developed coun-
tries have had climate conditions attached to them. In construction, the
introduction of energy and climate norms in France are leading to new
needs in terms of labour skills (isolation, double-glazed windows . . .), new
energy objectives to be reached, new architectural designs and approaches,
new integrated urban planning, as well as efforts at coordinating different
types of non carbon based energy sources (geothermal with wind and solar
. . .). Indeed, the double climate-energy crisis has had profound effects on
this sector.
Construction and urbanism actors have entered a new competitive field
structured by new climate and energy efficiency norms. In order to achieve
ambitious clean energy systems, buildings are now conceived as different
units of a larger, energy-integrated, whole, at the neighbourhood level.
This in turn requires a specific project management by city administrators
and coordinating teams, who have to coordinate the energy related actors
with the norms correctly. This is far from simple since different buildings
may have different forms, styles, structure, materials, objectives, norms as
well as different types of energy. This has led to a new role for architects
who now need to go beyond drawing and start acting as orchestra leaders
. . . To these different climate and energy norms and objectives, one also
finds participatory norms and in many countries, minimal norms con-

cerning social diversity (either economic or social). Thus, from an almost

purely technical and economic issue, energy has gained in the last few
years in complexity and now intersects politics, economics, technology,
urbanism, networks, skills, labour, geostrategy, management, environ-
mental, ethical, business models, energy security and autonomy . . .
The way climate governance is affecting water governance, to take
another example, is multi-layered. Since 2005, I have not found a single
paper on water governance without a climate component being present,
notably its impacts on: water quality, quantity and access; floods and
river flows; biodiversity and increasingly, on the impact of CC on water
as an energy source. Indeed, much effort and hope is put on non-fossil
fuels, and hydroelectric dams are at the centre of much attention, as the
most promising source of renewable energy. But hydroelectric capacity
will be directly affected by CC, through its impacts on variations in water
quantity (either not enough or too much) as well as regularity. Indeed, in
France, dams are used as equalisers of peaks in the national (nuclear) elec-
tricity demand but they may fail to fulfil this role if water becomes insuffi-
cient. Then water temperature has increased in average in most European
countries’ rivers in the last decade, but 28° is the limit at which a French
nuclear plant must be shut down. In 2011, an energy crisis was very closely
averted, when after two months of high temperature and little rainfall, it
finally started raining, avoiding a shut down of one of the French nuclear
power plants by 0.5°.
A last example is health governance. The 2003 European heat wave
illustrated all the problems of emergency responses when this emergency
is on a large scale and lasts too long: insufficient financial and human
resources as well as management failures led to an ineffective response to
the crisis and in taking care of the most vulnerable. Our current emergency
responses system is entirely inadequate when faced with recurring catas-
trophes that become the norm: according to recent IPCC projections, the
2003 European heat wave will be a ‘normal’ year before 2050, two years
out of three.4 But the political and social difficulty is that an increase in
average temperature not only translates into more emergency situations
but also into permanent health problems since increased heat is associ-
ated with respiratory diseases, making already sensitive people (especially
elderly) even more vulnerable to heart problems and so on . . . And this,
in a society where the age pyramid is becoming increasingly heavier at the
top.
Thus, climate as risk is also redefining the common perception of risk as
such, from punctual and extreme events to recurrent, permanent pressure.
In this sense too, it is a meta-risk that modifies our current understanding
of adaptation to risk. From responding to events, we now need to learn to

develop long-term self adjusting policies to constant but yet uncertain and
future change, which includes threshold levels and tipping points which
are yet not defined. Our governance system and culture is thus facing a
real new challenge. To this we need to add that one society’s vulnerability
to risk is not another’s. The literature on ecological inequalities shows that
social, political and economic capacities play the key role (not exposure to
natural hazards) in how much a crisis or a new stress will impact a society,
including with regards to secure and diversified energy sources. But even
wealthy societies have a limit: with all its wealth, knowledge, organisation
capacity on dikes and sea water management, even the Netherlands will
eventually reach a limit on its capacity to adapt to an increase in sea levels.
Viewed globally, these different issues are linked to the phenomenon of
path dependency, a notion underlying our argument.
PATH DEPENDENCY
Addiction is a terrible thing. It consumes and controls us, makes us deny
important truths and blinds us to the consequences of our actions.
Our society is in the grip of a dangerous greenhouse gas habit.5
Ban Ki-Moon, UN General Secretary
Developed by Pierson (2000), the notion of path dependency puts

forward the idea that any decisional process is affected by decisions taken
at an initial stage. Some choices are more determinant than others, which
causes a self-reinforcing process: the more one goes ahead on the path,
the deeper it becomes and the more difficult it is to move out of it and
the less there are political, social, cultural, economic and even conceptual
alternatives. Indeed, the double climate-energy crisis may be first and
foremost a crisis of our imaginative capacity at conceiving alternatives
to the carbon path. Ingrained homogeneity limits efforts at heterogene-
ity; carbon energy dependency limits efforts at developing plural energy
systems.
We are now touching the core of the tensions between climate and
energy governance: our deep carbon dependency, inherited from the past,
makes it very difficult to open a new path that will resolve the climate
crisis. Indeed, this may well be the fundamental obstacle: is our carbon
addiction so deep that only an in-depth social, political and economic
transformation can take us out of it? Most texts seem to presuppose that a
deviation suffices but the arguments they put forward do not allow such a
conclusion, especially considering the depth of our present carbon path in
all domains, including everyday behaviours and institutions.6 In a special
report, the World Bank warns:

The environment ministry base provides core expertise and an established

institutional home, but typically these are junior ministries. The linkage to the
energy ministry engages a key sectoral connection (fossil fuel combustion lies
at the root of climate change), but it also contains some risks: climate policy
may be captured or overwhelmed by more established energy policy orienta-
tions and/or other sectoral connections may be neglected. (Meadowcroft
2009, 15)
Trying to understand our present energy transition efforts means under-

standing the multiple and complex contemporary inertias that influence
efforts at moving to another energy system – which one exactly is still open
for debate, and vision. Even if there were no climate crisis, and we consid-
ered only peak oil, we would have to reflect on these issues but the urgency
would be less important (there is still enough coal and gas in the ground to
last until the turn of the century, especially with unconventional sources).
But the climate crisis amplifies and modifies the oil crisis, influencing how
we adapt to it and how we attempt to manage the peak oil period. In turn,
the oil crisis also affects the way we attempt to manage the climate crisis.
The difficulty is that at times the two goals are compatible and at times
they conflict with each other.
Considering the complexity of this question, it is surprising that there
is very little consideration in international reports and texts for theories
of transitions applied to energy governance, even while there are many
operational definitions of energy governance in the texts reviewed. Such
analysis of transition would have to include political, economic, social,
cultural, institutional, behavioural and technological factors that would
explain their effects on change: increasing or decreasing its speed, depth
and quality or that could even block change. Most efforts and means
devoted to both climate and energy governance proposed in most texts
reviewed aim at rectifying the path dependency’s trajectory. Few put
forward that we would need to get out of it entirely. This seems to depend
more on an institution’s position regarding the severity of CC impacts
than anything else . . . and their deep beliefs regarding the capacity to
govern such change. Indeed, the governance question here is primordial:
part of the answer regarding whether we need to get out entirely or just
divert the trajectory depends in part, not entirely, on how well climate and
energy governance are coordinated with each other. In most texts, both
climate and energy governance are conceptualised as mostly compatible
with each other and when conflicts are found, energy is given more weight
than climate in the political, economic and social arenas.
Still, CC has modified the way we conceive energy rarefaction.
Traditionally, and to summarise to a great degree here, the oil peak is
based on the amount of oil existing in the ground, plus accessibility and

costs/prices linked to supply and demand, (as oil prices increases, previ-
ously ‘unavailable’ oil due to high extraction costs, becomes ‘available’).
But with climate governance, an induced and structured rarefaction has
been emerging through limits imposed on carbon-based energy: carbon
taxes, subsidies for non carbon energy, efforts at finding and develop-
ing alternative energy types, or even, individual agreement and efforts to
modify behaviours to fight CC. Interestingly, this has a corollary but para-
doxical effect: increasing the time period during which oil will be available
. . . But other areas of tension need to be highlighted.
ENERGY GOVERNANCE
Globally, in the texts reviewed, contemporary energy governance takes a

threefold approach. The first objective is to ensure sufficient energy for
our civilisation’s needs – security of energy supply. But the oil crisis brings
us to diversify energy sources and types – the second angle. Coal use is
expanding at an incredible rate and so is natural gas, as well as research
and explorations for non-conventional, hard to get carbon based energy
sources, including in previously protected areas such as the Arctic. In
these cases, we are clearly at odds with climate governance but not with
decreasing energy dependency. The third angle, most recent, to energy
governance concerns efforts to develop a non-carbon energy mix that
includes wind power, geothermal, solar, nuclear and ‘passive’ forms of
energy (notably isolation and consumption reduction – which raises the
very difficult questions of values, comfort, behaviours, habits, rights to
consume, freedom, liberalisation of energy markets, energy production by
individuals and so on . . .).
Interestingly, most institutional reports do not offer clear conceptual
definitions of climate and energy governance – besides the idea that
they are part of a sustainable development framework. Yet, operational
definitions are used. The IPCC defines energy governance as ‘ensuring
long-term security of energy supply at reasonable prices to support the
domestic economy’ (Sathaye et al. 2007, 719). Interestingly, this narrow
definition does not include mitigation measures, the energy and the
climate aspects not being linked to each other by the IPCC! But we do
know what parts per million of CO² we should not surpass or the number
of degrees we should strive for and the general means by which to do
this. Also, several key notions and words have appeared which bridge the
gap between energy and climate: climate friendly development/investment/
business/technology; climate-compensated products, while climate neutral-
ity (UNEP 2008, 14), climate resilient society, post-carbon society or

non-carbon growth are becoming more commonplace – in some circles at

least. The energy question is omnipresent in the UNDP’s 2008 Human
Development Report, while a special section is entitled Climate policy as
human development (UNDP 2008, 28). Indeed, the choice of words used in
texts and the general goals offered (introducing a climate approach in all
aspects of life, in every sector, in a transversal integrated way rather than
a sectoral approach) all point to one direction: even though institutions
do not phrase it in such a way, the global objective is indeed, to create a
climate meta-governance.
The EU’s Lisbon Strategy integrates both climate and energy dimen-
sions and aims at reducing both consumption and energy dependency on
foreign markets. Energy efficiency is both a means to face increasing oil
prices and a predicted energy dependency of 70 per cent by 2030 (European
Commission 2008a) for EU countries. Then, renewable energies are key to
this effort since they also reduce GHG emissions. The 20/20/20 objective
is to reach by 2020, a 20 per cent reduction in energy consumption, 20 per
cent of renewables in the total energy package, with 10 per cent agrofuels
for transports in each member state. It is estimated that about half the
goal can be achieved with already existing measures. But this does not take
into account social factors such as the social un/acceptability of energy
reduction measures nor of non-carbon based energy diffusion. Indeed,
the diffusion of locally or individually produced energy puts in the hands
of individual citizens the capacity and the decision to implement and use
these energies . . . or not. Factors depend on price, return on investment,
aesthetics, understanding, opportunity, ownership, values . . . these all
contribute to the emergence of a new energy consumer. From a passive
individual simply paying his or her energy bills at the end of the month,
citizens are now more and more involved in different energy choices,
regarding sources, types, at what times of day and at what price, and
through different technological means to control energy consumption.
The same individual may even now produce energy.
As for climate governance, a transversal definition from the texts could
be the sets of efforts in the short, middle and long terms to develop a
non-carbon and climate-proof society through mitigation and adapta-
tion measures (technologies, cultural change, economic levers, public
policy, education, legislation . . .) and whose aim is to cap the increase in
temperature at 12° (relative to industrial era) so as to reduce as much as
possible social and political instability resulting from CC impacts while
ensuring material development. These efforts are structured and slowed
down by carbon based energy path dependency, whose associated prob-
lems are supposed to be resolved through the framework of sustainable
development. To sum up, then, sustainable development aims at allowing

for economic development in a participatory and ecological manner, while

energy governance aims at ensuring economic activity, energy security and
quality of life and finally; climate governance aims at stabilising green-
house gases and climate change. While several single obstacles have been
clearly identified, the general framework in which they operate, the carbon
path dependency, is less well understood. Let us then explore further
the energy pole of the climate and energy governance and sustainable
governance trio.
TENSIONS BETWEEN CLIMATE AND ENERGY

GOVERNANCE
Climate governance is having an effect on energy governance but it is

not, by a far cry, entirely setting the rules of the game. Energy needs and
security are a pressing, immediate, necessity (or perceived as such) for
our quality of life, our consumption/production and our general mode of
living. But climate impacts are on the longer term and are yet uncertain.
In this context, we see both an increase in the diversity of energy sources
used and at the same time, a sharp increase in the use of coal, while shale
gases are undergoing an explosive increase in production rates. For the
time being, energy governance (with security of supply) remains the most
important short-term obstacle to efficient climate governance and to the
rise of climate governance as a meta-governance.
One of the most important differences between climate and energy gov-
ernance is that the concept of energy security is an already well practiced
and politicised notion. It is key to both decision makers and industrial
actors. Necessary to industrial operations and profits, energy security is
also inscribed in most nations’ constitutions. Climate security still remains
a climate expert notion: even while climate security is linked to CC’s
impacts on already existing risks, climate security is yet to be put on the
political agenda of the world’s nations – and still less inscribed in constitu-
tions. But international organisations (see European Commission 2008a,
UNDP 2008 or World Bank 2008) increasingly recognise climate security
as a priority, especially through issues such as water stress, decreased
agricultural production, droughts and violent natural disasters which will
all contribute to population displacements. These institutions also make
a link between climate and energy: the rarefaction of energy resources
will combine with decreased agricultural production to increase local con-
flicts over resources as well as international geopolitical tensions to secure
energy access by the major powers (Schwartz and Randall 2006), including
China, the USA and India. Clearly, if CC has been undergoing a process

of securitisation (Leboeuf and Broughton 2008), it is mostly within inter-

national organisations.
One notes clear differences in ‘attitudes’ toward both forms of govern-
ance: while climate governance is seen as eventually, leading in the middle
and long terms, to new business and job opportunities, energy governance
is more conceived in the short term and it aims at not losing jobs and
to limit as much as possible the impact on the quality of life of citizens.
Climate governance is presented in terms of potential future gains if one
develops a good strategy, while energy governance is often termed as
avoiding a potential crisis. Energy governance is a short term issue closer
to political and economic temporal agendas; it is direct in terms of effects
and costs, it is visible and easily perceivable by all stakeholders (who would
want to experience a power shortage in the middle of winter?). But the fight
and adaptation to CC are not yet part of national security agendas; they
are long-term diffuse problems; they are not visible (only their indirect
effects are quantifiable and they are not visible to the common eye); they
are global (their local effects cannot yet be really seen in wealthy countries);
their costs are still invisible and very indirect for most stakeholders. But
politics tends to be short term and local and at best, for individual stake-
holders, national. The UNDP puts it this way: ‘The deeper problem is that
the world lacks a clear, credible and long-term multilateral framework that
charts a course for avoiding dangerous climate change – a course that spans
the divide between political cycles and carbon cycles’ (UNDP 2008, 5).
Most analysts see renewable energies (REn) as a way out of these dif-
ficulties because they reconcile most tensions between both forms of gov-
ernance: they stimulate R&D, reduce GHG emissions and allow for local
and decentralised energy production – thus reducing energy dependency
on foreign markets, which has become a priority for many countries now
and an integral part of energy policies in the US and the EU for example.
In many ways, REn are seen as a mechanism to get out of the carbon path
but there remains an essential condition linked to participatory democ-
racy: that they are accepted by the populations. Indeed, REn create a new
logic between individuals and energy production: the traditional passive
energy consumer is now becoming a consumer with increasing choices for
energy types and energy suppliers or even producers. More importantly,
the consumer can now become self-sufficient in energy or even become an
energy producer selling on the market, given that such an individual con-
sumer adopts REn. That is an important issue since wind power continues
to be refused by local communities, while adding insulation to already
existing buildings is judged by owners to be too expensive and the reduc-
tion of energy consumption expected by reports is still not happening. In
other words, the social un/acceptability of REn may have a direct impact

High conflict High coherence
Coal increase in oil prices REn
New oil/gas sources (decrease car use but increased coal use) Nuclear
Energy security
Agrofuels
Figure 18.1 Climate governance versus energy governance
on the speed and depth at which they are deployed and thus on the way
out of carbon dependency.
The above modifies the argument that climate governance is becoming
a meta-governance. But areas of conflict with energy governance block or
slow down this movement. In many countries the emergence of energy as a
national security issue in the last few years has led to new efforts at devel-
oping and finding non-carbon but also carbon based energy, such as coal,
and previously hard to reach and expensive unconventional carbon-energy
sources. At the same time, institutional reports abound with good exam-
ples of climate and energy governance practices. They insist on the fact
that the best policies combine both energy and climate objectives but they
do issue warnings that not all is post-carbon or carbon sober in a would-be
climate governed world: for example, decoupling climate and energy is
leading to serious detrimental policies, such as the development of coal
energy in China or the USA (Gupta et al. 2007, 796). The diagrams below
illustrate only a few other examples of the different obstacles on the road
to a high sobriety, non-carbon society.
Note that agrofuels are not placed high on the coherence scale because
forests are sometimes cut for their production. But there are high expec-
tations for second and third generation (food leftovers for example and
algae). What appears is that issues of conflict tend to show that in the
short term, economic and national interests – and national security for
several countries – are driven by energy, not climate.
Almost all texts recommend the diversification of energy sources (in
terms of countries and types of energy) with an increase in REn; they
expect a reinforcement of nuclear energy; they insist on the necessity to
decrease energy consumption through technical efficiency and; push for
(hope?) sobriety, i.e., a decrease in energy consumption through behav-
ioural changes (daily behaviours such as cooking, heating and transport
as well as consumption). But these measures sometimes conflict with
democratic rights, expectations, beliefs and habits linked to consumption
and the right to do so.

High conflict High coherence
Energy security Rebound effect REn
Nuclear
agrofuels
Figure 18.2 Climate/energy governance versus social acceptability
All texts agree that REn are a key element of the transition to a carbon
sober society for both energy and climate reasons, but they are not suf-
ficient to solve the energy issue as a whole. And in democratic wealthy
countries, they are subjected to local acceptability and the capacity and
willingness to change behaviours, or adopt REn where they are, or where
they could be implemented. Their social acceptability depends on several
factors linked to individual types of REn, but in general they include cost
and time of return on investment (solar and isolation), aesthetics and
wildlife (wind), historical protection, sense of freedom and autonomy
(battery-fuelled cars), perception of security, comfort (Wan-Jung et al.
2010) and the rebound effect.
The rebound effect occurs when the expected gain in energy efficiency
from a technological improvement is diminished or even cancelled by
behaviour arising from the expectation of the gains in energy the tech-
nology is supposed to bring. The perception that the technology allows
a decrease in energy consumption leads to behaviour that is even more
energy hungry. For example, since fuel efficient vehicles make travel
cheaper, consumers may choose to drive further and/or more often,
thereby offsetting some of the energy savings achieved. This is termed the
direct rebound effect. One may also have an indirect rebound effect, which
occurs when ‘any reductions in energy demand will translate into lower
energy prices which encourage increased energy consumption . . . The
sum of direct and indirect rebound effects represents the economy-wide
rebound effect’ (Sorrell 2007, viii).
In the UK, a large government-funded programme aimed to improve
energy efficiency with insulation and heating systems decreasing the cost
of energy in the first year. But families increased the temperature of their
houses (and energy consumption) so much that in the second year that
the cost increased beyond what it had been before the improvements
(European Environment Agency 2007, 271).
These examples highlight the complexity of the phenomenon of
carbon-based energy path dependency due to its multi-factorial and
multidimensional elements. In other words, for reasons of energy needs

and path dependency, the way out of the fossil fuel path is arduous at
best and it raises fundamental questions regarding our consumption and
production as well as our political systems. The question of how quickly
change will occur and how difficult it will be, depends only in part on
technological progress, with economic, political and social factors playing
a very important role, but the tensions between participatory democracy
and energy governance are worth noting.
CONCLUSION
The underlying transition question is: how do we stabilise GHG in a

context where non-carbon based energies are insufficient to maintain
even our present standards of living made possible by fossil fuels (this is
the key point) and where these fuels are more than sufficient to drive us
to a world ecological catastrophe? The dynamics of this evolution are
complex, both harmonious and conflicting. Our initial hypothesis that
climate governance is emerging as a meta-governance redefining other
issues, including energy, holds but under certain conditions. It holds when
climate and energy governance work harmoniously. But in cases where
there is a conflict between both forms of governance, energy takes priority
over climate, even if it is not entirely left aside. This is indeed not a binary,
all or nothing, process: even while it may lose the short-term race, climate
governance influences energy governance. Hence, even when a coal plant
opens, there are efforts to implement carbon capture and sequestration
technologies. Oil and coal extraction emit less GHG than before due to
new techniques and technologies, while vehicle engines are also declining
in emissions. But fossil fuels are still the rule and still get priority. While
climate governance does seem to be emerging as a meta-governance, in the
short term, the importance accorded to energy will give it priority when
conflict arises between both, slowing its process down . . . perhaps until
both become integrated in a climate compatible way.
The question then is: do we need to entirely get out of the carbon based
economy and social path dependency or is a deviation of the path enough?
According to Abbas (2011), who offers a macro economic analysis of
climate governance, our modes of production and consumption are so
intertwined with our carbon based energy structure that our efforts at
resolving the climate crisis will likely necessitate an exit from the existing
economic system – to which we can add the problem of urgency.
The questions raised here are important for the social sciences
and policy makers, as well as for populations. Indeed, the first great
human revolution, the Neolithic revolution, and then the sedentari-

sation of the human species – with the associated development of

agriculture – happened ‘on their own’, without conscious volitions on our
part. For the first time in human history, not only are we facing a really
global and total crisis but we are also aware of this crisis and are attempt-
ing to create planned, conscious, solutions and apply them. Toward the
creation of a total and global meta climate governance? Such an effort
has never been attempted; we have no past experience in the matter and
no lessons from history to draw on. Thus, indeed, the challenge is total
and global in the sense that it involves all human activities. In this sense,
CC is not only a phenomenon; it is an epiphenomenon (Olivier 2005),
affecting the way we think and perceive the world globally. As such,
climate has become increasingly a political issue in the large sense of the
term, in terms of ‘living together’.
NOTES
1. This chapter presents the main argument from a multi-authored book: S. La Branche
(ed.) (2011) Le changement climatique. Du méta-risque à la méta-gouvernance, Lavoisier.
2. My sincerest thanks to EDF (Electricité de France) who funded the initial research that
led to the reflections presented here. ‘La gouvernance climatique et énergétique face à la
dépendance au sentier. Recension et Etude de prospectives’. 2008, EDF.
3. This has impacts on analyses as well since CC necessitates, arguably, more multidiscipli-
nary approaches than any other environmental issue.
4. See among others, IPCC (2012). Managing the risks of extreme events and disasters to
advance climate change adaptation, WMO UNEP.
5. In UNEP (2008), p. 6.
6. Young’s recent studies fit rather well with this idea of path dependency, applied to
institutions. To him, environmental efforts by an institution may well be blocked by
its internal operations, its identity, its culture or its structure. This natural ‘stickiness’
may require a change in identity in order for environmental goals to be reached (Young
2002a, 2002b).
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PART VI
ENERGY AND HUMAN

SECURITY

19. Energy poverty: access, health and welfare
Subhes C. Bhattacharyya
1 INTRODUCTION
The United Nation’s decision to declare 2012 as the ‘International Year

of Sustainable Energy for All’ has once again caught global attention on
sustainable energy in general and energy poverty in particular. Lack of
access to clean or modern energy and an inability to use the desired energy
when required tends to adversely influence the development prospects
of the population and impose social burdens in terms of adverse health
effects and welfare losses. Moreover, sustainability of energy provision
and energy supply security implications of energy poverty have received
limited attention in the past. While attempts are being made to extend
basic energy services, the supply is often erratic and limited and does not
ensure long-term needs, thereby causing concerns about a reliable supply.
There is also the concern for future resource implications of enhanced
energy access. This chapter reviews energy poverty, discusses the health
and welfare implications of energy poverty and elaborates on the sustain-
ability and energy security dimensions.
The chapter is organised as follows: the next section presents the defini-
tion of energy poverty and elaborates on the nature of the problem. The
third section discusses the incidence of energy poverty, while section four
presents the health and welfare implications of energy poverty. Finally, the
fifth section considers the remedial measures and the last section presents
the concluding remarks.
It needs to be highlighted here that this chapter does not cover the fuel
poverty problem. Although fuel poverty is an important issue, particularly
in some parts of Europe, the focus here is on the bigger issue of energy
access.
2 ENERGY POVERTY
2.1 The Concept
Energy poverty is not a well-defined term. Pachauri et al. (2004) indicated

that three types of measures are normally found in the literature:
423

1. Economic measures such as energy poverty line as used in the United

Kingdom: This tries to find out the share of spending on energy by
those below the national poverty line and compares this against a
benchmark level (say 10 per cent). If a consumer spends more than
this threshold level on energy, the consumer may be regarded as being
below the fuel poverty line.
2. Engineering measures of minimum energy needs: this uses normative
estimates of the basic energy needs of a household and anyone below
this level is considered energy poor.
3. Measures based on access to energy services: this tries to find out
whether consumers have physical access to the supply of energy, and
access to markets for equipment.
The issue arises because the term energy poverty draws parallel
from the poverty literature where poverty is generally related to
inadequate levels of income and consumption to fulfil the basic
needs, which in turn, implies the deprivation of the basic minimum
needs of a population. From this perspective, the energy poverty
would mean ensuring a minimum quantity of energy to meet the
essential needs of a population. Generally, either engineering esti-
mates or normative values1 are used to determine the essential needs
but these estimates have their own issues as well due to inherent
subjectivity.
Moreover, the needs might not remain unchanged over time and
consequently the target itself can move, thereby creating the challenge
of reaching a moving target. Further, ‘the poor’ is not a homogeneous
category, and both endowments and entitlements can vary even within
a country and across countries, implying that the needs are not homo-
geneous for the poor. In the case of energy this becomes important as
the needs depend on geographical location, climatic conditions, resource
endowments, etc.
Thus, Pachauri (2011) explains that reaching a consensus on the defi-
nition hinges on agreements on three elements: 1) consensus on services
defining the basic needs basket, 2) a clear definition of the thresholds
defining the basic needs, and 3) assessing the household expenditure on
energy by different income class. Reaching an agreement on these ele-
ments is not easy.
A number of attempts in the literature try to capture the energy poverty
through an indicator. The International Energy Agency has come up
with an index, the Energy Development Index (EDI), along the lines of
the Human Development Index. EDI is composed of the following four
factors (IEA 2010):

Energy poverty: access, health and welfare 425
Table 19.1 Factor goalposts for 2010 EDI
Factor Maximum Minimum

Per capita commercial energy 2.88% (Libya) 0.03% (Eritrea)
consumption (toe)
Per capita electricity consumption 0.08% (Venezuela) 0.001% (Haiti)
in the residential sector (toe)
Share of modern fuels in total 100% 1.4% (Ethiopia)
residential sector energy use
Share of population with access to 100% 11.1% (DR Congo)
electricity
Note: Toe 5 ton of oil equivalent.
Source: IEA (2010).
● per capita commercial energy consumption;

● per capita electricity consumption in the residential sector;
● share of modern fuels in total residential sector energy use;
● share of population with access to electricity.
An index is created for each factor by considering the maximum value and
minimum values observed in the developing world and determining how a
particular country has performed. The following formula is used for this
index:
(Actual value − minimum value)

Factor index 5 (19.1)
(maximum value − minimum value)
The goalposts (maximum and minimum values) are taken from the
observed values within the sample of developing countries considered. For
example, for calculating the factor goalposts for 2010 EDI, WEO (2010)
used the values given in Table 19.1.
The simple average of four indicators gives the overall EDI. For any
country, e.g. India, EDI can be calculated using Formula 1 and noting the
goalposts as well as actual data for the country. For 2009, India’s indi-
vidual indicators are shown in Table 19.2.
Although this indicator provides a numerical value, it is not devoid of
problems. It perpetuates the idea that a higher level of commercial energy
or electricity consumption is synonymous to economic development.
Accordingly, countries in the Middle East with high per capita energy use

Table 19.2 Example of EDI for India
Factor Indicator
Per capita commercial energy consumption 0.140
Per capita electricity consumption in the residential sector 0.111
Share of modern fuels in total residential sector energy use 0.213
Electrification rate 0.62
Average index 0.272
Source: IEA (2010).
Table 19.3 Commonly used national and international indicators of

energy poverty
Scope Indicator
International Physical access to energy by households or population
Energy Development Index
National Physical access to energy at the village or community level
Minimum norms of energy needs for different uses or its
variations
Share of energy expenses in the household budget
Share of energy expenses and annualised cost of end-use
appliances in total household budget
Associate time costs
Health impacts
Source: Pachauri and Spreng (2011).
rank better in this index. It also assumes that biomass energy use repre-
sents a symbol of under-development, which need not be the case, depend-
ing on how it is used. Finally, it does not pay any attention to sustainable
energy supply or use.
Pachauri and Spreng (2011) provide a list of common national and
international measures used in describing energy poverty (see Table 19.3).
They also call for simple, measurable but meaningful indicators. More
recently, Nussbaumer et al. (2012) have presented a multi-dimensional
energy poverty index (MEPI) by capturing modern energy deprivation
and the incidence and intensity of energy poverty. Yet, the sustainability
issue has not been adequately captured in the indicators. Further work in
this area is required.

2.2 Energy Poverty and Energy Security Linkage
Given that energy security aims for ‘reliable and adequate supply of
energy at reasonable prices’ (Bielecki 2002), and because energy poverty is
a manifestation of deprivation, the link between the two concepts becomes
obvious. In a situation of energy poverty, not even the basic needs of
energy are satisfied and there is a clear deficit in terms of reliability and
adequacy of supply. Thus energy poverty also implies insecure energy
supply. Further, the poor typically pay more for their energy needs and
receive poorer quality of service due to inefficient technologies and poor
infrastructure (Sovacool 2012), thereby making them worse off than other
users.
The reliability and adequacy of supply also tends to have an urban bias,
implying that urban consumers are traditionally given higher preference in
terms of supply compared to the rural consumers. For example, electricity
supply to rural India is often restricted to off-peak periods (10pm to 6am)
when most household consumers do not need the supply. Rural electric-
ity supply is often limited to a few evening hours in many countries and
modern energies like kerosene or LPG reach the rural areas only infre-
quently. Lack of energy supply security thus reinforces the dependence on
traditional sources of energy.
Dependence on traditional energy also leads to occupational hazards
and human security issues. In most cases, the burden of traditional fuel
wood collection falls disproportionately on women. Sovacool (2012)
reports that on average an African woman carries 20 kg of fuel wood
over 5 kilometres per day, which in turn inflicts injuries and other
hazards including those of health and safety. It has been reported that
women have faced assaults and violence while collecting fuel wood at
times of civil unrest or war-like situations. The economic cost of such
occupational hazards is barely estimated or considered in energy policy
decisions.
Moreover, the remedial interventions to address energy poverty can
also have energy security implications. For example, if the solution
aims at meeting the basic needs for a limited period of time, then the
supply is unlikely to be adequate and reliable and perhaps may not
be affordable. This has emerged as the main complaint against many
energy access programmes in recent times. Similarly, if the intervention
envisages introduction of a non-renewable energy, it can impose supply
security concerns depending on the country’s present resource status.
Thus energy poverty eradication joins the energy security challenge that
cannot be ignored.

3 INCIDENCE OF ENERGY POVERTY
Energy demand in poor households normally arises from two major

end-uses: lighting and cooking (including preparation of hot water).2
Cooking energy demand is predominant in most cases and often accounts
for about 90 per cent of the energy demand by the poor. Such a high share
of cooking energy demand arises partly from the low energy efficiency and
partly due to limited scope of other end-uses. As electricity is considered
the appropriate form of energy for lighting, it is customary to associate the
access to clean lighting to the level of electrification of a country. Access
to clean cooking energies on the other hand can take different paths and
therefore the access related information is generally presented for electric-
ity and for cooking energies separately.3 We maintain this distinction in
this chapter.
3.1 Status of Electrification in Various Regions
The regional picture of electrification is presented in Table 19.4 (IEA

2011).4 In 2009, more than 1.3 billion people (i.e. about 19 per cent of
the global population) did not have access to electricity. Two regions
stand out: South Asia, with 675 million (or 42 per cent of the population)
without access comes first, while Sub-Saharan Africa comes second with a
population of 587 million (or 40 per cent) of those without access to elec-
tricity. Outside these two regions, East Asia has 195 million without access
to electricity (or about 13 per cent of those without access).
Table 19.4 Level of electrification in various regions in 2009
Region Population without Electrification rate (%)

electricity (Millions)
Overall Urban Rural
North Africa 2 99.0 99.6 98.4
Sub-Saharan Africa 585 30.5 59.9 14.2
Africa 587 41.8 66.8 25.0
China and East Asia 182 90.8 96.4 86.4
South Asia 493 68.5 89.5 59.9
Developing Asia 675 81.0 94.0 73.2
Middle East 21 89.0 98.5 73.6
Latin America 31 93.2 98.8 73.6
Developing Countries 1,314 74.7 90.6 63.2
Global total 1,317 80.5 93.7 68.0
Source: IEA (2011).

Middle East
South America, 21.2% Nigeria, 76.6%
Rest of 31.2%
Asia, Ethiopia, 69.5%
102.8% Myanmar, 44.3% DR Congo, 59.4%
Tanzania, 38.3%
Pakistan, 64.5%
Kenya, 33.3%
Indonesia, 82.6%
Other SS Africa,
Bangladesh, 310.24%
96.7%
India, 289.22%
North Africa, 2.0%
Note: The first number in the label refers to population in million without electricity
access.
Source: IEA (2011).
Figure 19.1 Major concentration of population without access to

electricity in 2009
A closer look at the data shows that about 69 per cent of those lacking
access to electricity reside in just 12 countries while the remaining 30 per
cent is dispersed in all other countries (see Figures 19.1 and 19.2). The
rural population in most of these countries lacks access, although in a few
countries the urban population also lacks access. While the total number of
people without access to electricity is high in South Asian countries, Sub-
Saharan Africa fares worse in terms of rate of electricity access. In fact, out
of 10 least electrified countries in the world, nine are from sub-Saharan
Africa and Myanmar is the only country from Asia (see Figure 19.3).
Interestingly, the most populous country in the world, China, has
achieved a very impressive record of providing electricity with only 8
million (or about 0.6 per cent of its population) without the facility.
Similarly, a number of South East Asian countries such as Thailand,
Malaysia, Vietnam and the Philippines have made impressive progress
on the electrification front. In South America, Brazil, the most populous
country of the region, has achieved an impressive record of about 2 per
cent of its population without access to electricity, most of whom are
located in the Amazon region.

100
90 Urban Rural
80
% electricity access
70
60
50
40
30
20
10
0
an
Ta ya
M nia
ar
go
Pa ia
an
In ria
ng ia
sh
a
nd
di
op
s
nm
de
en
st
on
st
ne
a
In
ig
ga
ni
ki
nz
hi
la
K
do
C
ya
N
ha
Et
R
fg
Ba
D
A
Source: IEA (2009).
Figure 19.2 Urban-rural electricity access disparity in major

concentrations in 2009
30
25
Electrification rate (%)
20
15
10
0
Uganda
Malawi
DR Congo
Mozambique
Myanmar
Tanzania
Burkina Faso
Afghanistan
Lesotho
Kenya
Ethiopia
Zambia
Madagascar
Togo
East Timor
Cambodia
Benin
DPR Korea
Angola
Source: IEA (2011).
Figure 19.3 Ten least electrified countries in the world in 2009
3.2 Status Of Cooking Energy Access
IEA (2011) provided some details about biomass use in the developing
countries and estimated that about 2.7 billion people use biomass for
cooking and heating purposes in these countries (see Figure 19.4).

Nigeria, 104.4%
Ethiopia, 77.3%
South America, DR Congo, 62.2%
85.3% Tanzania, 41.2%
Kenya, 33.1%
Other SS Africa
Rest of Asia, 335.13%
648,24%
North Africa,
4.0%
Myanmar,
48.2%
Pakistan, India, 836.31%
122.5%
Indonesia,
124.5% Bangladesh,
143.5%
Note: The first number in the label refers to population in million without clean cooking
energy access.
Source: IEA (2011).
Figure 19.4 Distribution of lack of cooking energy access in the world in

2009
Table 19.5 Reliance on biomass for cooking energy needs in 2009
Region Total population Total Rural Urban

% Million Million Million
Sub-Saharan Africa 78 653 476 177
Total Africa 65 657 480 177
India 72 836 749 87
China 32 423 377 46
Rest of Asia 63 731 554 177
Latin America 19 85 61 24
Total 51 2662 2221 441
Source: IEA (2011).
At a disaggregated level, more than 80 per cent of the people lacking

access to clean energies live in rural areas (see Table 19.5). Asia, with more
than 72 per cent of those lacking access, has the largest share followed by
Sub-Saharan Africa, but in contrast to electricity access where both the

80
70
60
50
% Share
40
30
20
10
0
EI Gas Kero Coal Charc Wood dung Other
DC SSA LDC
Note: DC: Developing countries, LDC: Least Developed Countries, SSA: Sub-Saharan
African countries.
Source: UNDP-WHO (2009).
Figure 19.5 Share of different cooking fuels in developing countries in

2007
regions share similar sizes of population without access, here the picture
is quite different.
The size of urban population lacking access to clean energies in both
the regions is very similar but the rural population lacking access to clean
cooking energies in Asia is 3.5 times more than that of Sub-Saharan
Africa. India has the single largest concentration of people lacking clean
cooking energy access in the world.
Although a range of fuels is used for cooking, according to the
UNDP-WHO (2009) study, about 2.6 billion people rely on traditional
energies and 400 million rely on coal. There is significant regional varia-
tion in terms of fuel use (see Figure 19.5), but the rural population is gen-
erally more reliant on solid cooking fuels, including traditional energies.
Moreover, the use of improved cooking stoves is limited to only 30 per cent
of those relying on solid fuels but the dependence on traditional stoves is
predominant in the least developed countries (LDCs) and Sub-Saharan
Africa (UNDP-WHO, 2009).
3.3 Future Outlook
But more importantly, forecasts by IEA (2011) suggest that almost 1

billion people will still lack access to electricity in 2030 while 2.7 billion

Table 19.6 Expected number of people without electricity access in 2030
Region In 2030
Urban Rural % of population
Sub-Saharan Africa 107 538 49
India 9 145 10
China 0 0
Rest of Asia 40 181 16
Latin America 2 8 2
Middle East 0 5 2
Total of Developing world 157 879 16
Source: IEA (2011).
Table 19.7 Outlook for biomass use for cooking in 2030 (million)
Region By 2030
Urban Rural %
Sub-Saharan Africa 270 638 67
India 59 719 53
China 25 236 19
Rest of Asia 114 576 52
Latin America 17 57 14
Total Developing world 485 2230 43
Source: IEA (2011).
people will not have access to clean cooking energies. Although the fore-
cast assumes a significant level of investment ($13 billion per year on
average), increases in the population in developing countries of South
Asia and Sub-Saharan Africa will mean that electricity access will remain
a problem. According to IEA (2011) 356 million in South Asia and 645
million in Sub-Saharan Africa will still live without electricity access (see
Table 19.6).
In terms of access to clean cooking energies, the situation will be even
worse. IEA (2011) suggests that 485 million urban population and 2.2
billion rural population will still continue with traditional energy even
by 2030 unless more specific interventions are made (see Table 19.7). The
size of population relying on traditional energies in Sub-Saharan Africa
will increase to 900 million by 2030 and one-third of the global popula-
tion without clean cooking energy will reside there. This represents a

eterioration compared to the present situation. The situation in Asia

d
improves marginally but still about two-thirds of the population without
clean cooking energy will be found there by 2030. India will continue to
remain the country with the highest concentration of population without
clean cooking energy. Clearly, the future does not appear to be very prom-
ising and serious thoughts in terms of policy analysis and implementations
will be required to address these issues.
However, governments of most of the countries are now aware of the
problem and a large number of countries have set energy access targets.
According to UNDP-WHO (2009), almost one-half of all the developing
countries have set targets for electricity access, with Sub-Saharan coun-
tries emerging as leaders in setting targets. In the case of clean cooking
energies, only a few countries have set targets but Sub-Saharan countries
are appearing to be more proactive here as well. The regional distribution
of countries with targets for electricity access and clean cooking energies is
presented in Figure 19.6.
90
80
70
Number of countries
60
50
40
30
20
10
0
DC LDC SSA Arab EAP South LAC
States Asia
Elec Cooking
Note: DC: Developing Countries, LDC: Least Developed Countries, SSA: Sub-Saharan
Africa, EAP: East Asia and the Pacific, LAC: Latin American Countries.5
Source: UNDP-WHO (2009).
Figure 19.6 Regional distribution of countries with targets for electricity

and clean cooking energy access

100
% Access 80
60
Zimbabwe
Gabon,
40
Botswana
20
0
100 1,000 10,000 100,000
GNI per capita (PPP$ 2005)
Elec acc Cooking acc
Source: HDI data for 2011 and UNDP-WHO (2009) for electricity and cooking energy
access.
Figure 19.7 Energy access improves with per capita income6
4 ENERGY POVERTY AND WELFARE ISSUES
4.1 Energy Poverty: Development Linkage7
As is generally expected, higher levels of energy access are normally

associated with a higher income level but a rapid improvement in access
level occurs within an income band bounded by a lower threshold income
level of about $1,000 per person in PPP terms 2005 and an upper satura-
tion level of about $15,000 per person in PPP terms (see Figure 19.7).
Those below the lower threshold clearly lack access to clean energy, while
everyone above the upper threshold has access to clean energy services.
However, the scatter plot shows a significant level of dispersion within the
upper and lower thresholds, implying that some countries are able to reach
better energy access at low income levels while some with high income
have failed to deliver energy access to their population. Clearly, income
does not automatically ensure high level of energy access of a country and
there are other drivers that play an important role. However, a detailed
analysis of the causes, drivers and lessons from the successful/ unsuccessful
cases is beyond the scope of this chapter and is an area of further research.
The Human Development Index of a country, on the contrary, bears
a better correlation with energy access than income. Using the HDI data
for 2011 and energy access data presented in UNDP-WHO (2009), a
few indicators linking HDI and economic development are presented in

1.0
0.9
y = 0.3868x + 0.3523
0.8 R2 = 0.811
0.7
HDI
0.6 Kenya
Rwanda
0.5
0.4
0.3
0 20 40 60 80 100
Electricity access (%)
access.
Figure 19.8 HDI and electricity access
1.0
0.9
y = 0.3538x + 0.4102
0.8 R2 = 0.7436
0.7
HDI
0.6
0.5
0.4
0.3
0 20 40 60 80 100
Population with access to cooking energy (%)
access.
Figure 19.9 HDI and cooking energy access
Figures 19.8 to 19.11. Figure 19.8 shows that better HDI scores are gener-
ally associated with higher levels of electricity access, while Figure 19.9
shows that the HDI also is positively correlated with access to cooking
energy. Similarly, the life expectancy and mean schooling years are also
positively correlated to clean cooking energy access and electricity access

85
y = 19.569x + 56.272
Life expectancy at birth (years) 80 R2 = 0.5517
75
70
65
60
55
50
45
40
0 20 40 60 80 100
Population with clean cooking energy access (%)
access.
Figure 19.10 Life expectancy at birth and cooking energy access
14
12
y = 4.9778x+3.0935
Mean schooling (years)
10 R2 = 0.5347
0
0 20 40 60 80 100
Electricity access (%)
access.
Figure 19.11 Mean schooling years against electricity access
(Figures 19.10 and 19.11), although the goodness of fit of a linear relation-
ship is less strong than the previous two cases.
AS HDI focuses on three equally-weighted components (namely life
expectancy at birth, mean schooling years and GNI per capita), and
because energy is one of the many drivers (and thus has an indirect

influence) behind the performance of these components, the influence of

energy on HDI is not always very straightforward.
4.2 Health Impacts of Energy Poverty
The health problem associated with energy poverty arises mainly due
to indoor air pollution caused by burning solid fuels. Poor households
rely on primitive technologies and solid fuels and family members, often
women and children, are exposed to excessive smoke from incomplete
combustion of these fuels. As the smoke contains substances like carbon
monoxide and small particulate matter, that are toxic to human health,
severe health impacts result. Polski and Ly (2012) report that while the
acceptable concentration of PM10 is 50 micro-gram/m3, average concen-
tration of 600 micro-grams/m3 and high levels of 2000 micro-grams/m3
are not uncommon.
Indoor air pollution is responsible for acute respiratory infections,
chronic obstructive pulmonary disease and diseases like asthma, lung
cancer, low weight at birth, cataract, tuberculosis, etc. (WHO 2007). The
average level of exposure to smoke from fuels is three hours per day,
which is equivalent to smoking two packets of cigarettes daily (Bruce et al.
2000). Such exposure levels cause respiratory infections in children and are
the major cause of child mortality. Similarly, solid fuel use is responsible
for airflow restriction in the pulmonary system (found mostly in women
above 30), which is not fully reversible and lung cancer is also a result of
smoke from solid fuel combustion.
According to UNDP-WHO (2009), 1.94 million deaths per year can
be attributed to solid fuel use in developing countries. The least devel-
oped countries and Sub-Saharan Africa suffer most severely in terms of
death rate per million population. Globally, one-third of the deaths from
pneumonia, COPD and lung cancer are attributable to solid fuel use but
in the LDC and Sub-Saharan Africa, this share increases to one-half
(UNDP-WHO, 2009). A broader measure, disability adjusted life years
(DALY), that captures the premature death and the years lived with a
disease, reveals even more concentrated effects of solid fuel use in these
regions. Out of 40 million DALYs attributable worldwide to solid fuel
use, 45 per cent occur in LDCs and 44 per cent in Sub-Saharan Africa
(UNDP-WHO, 2009). According to Sovacool (2012), the cost to the
national health system ranges between $212 billion to $1.1 trillion. Using
the projected biomass fuel use trend WHO estimates that indoor air pol-
lution would lead to 1.5 million premature deaths per year by 2030. This
would pose significantly higher health risks compared with other infec-
tious diseases like malaria and tuberculosis.

The health problem related to energy poverty has a gender bias as well.
Women are generally more affected than men due to higher exposure
to smoke. Children are also critically vulnerable due to their immature
metabolic system pathways. 44 per cent of the deaths due to solid fuel
use occur in children and 60 per cent of the adult deaths involve women
(UNDP-WHO, 2009) in developing countries. The human development
index bears a close association with disease burden: lower HDI is associ-
ated with high disease burden and vice-versa. The Sub-Saharan African
countries generally register the highest disease burden and lowest HDI.
As the population in Asia and Africa increases, the overall health
impact will be aggravated unless remedial measures are taken. This will
inflict significant economic loss to these countries and cannot be allowed
to happen. Consequently, remedial measures need to be considered.
5 OPTIONS FOR REMEDIAL INTERVENTIONS
A number of intervention options for reducing the health impacts of

solid fuel use can be found in the literature. These can be categorised into
three groups: 1) changing the source of pollution, 2) improving the living
environment and 3) modifying the user behaviour (Isihak et al., 2012).
Figure 19.12 provides the details of such options.
Generally, the policy focus has centred on promoting cleaner petroleum
fuels (such as LPG or kerosene) and clean cooking stoves. However, as
the poor often cannot afford the cost of petroleum fuels and the associ-
ated devices, such an option requires a subsidised supply of the fuel and
a mechanism to ensure access to the required appliances. This issue then
ties well with the energy supply security concerns due to increased vulner-
ability of the countries to international price fluctuations and consequent
economic hardships. Such a policy also becomes vulnerable due to its poor
long-term prospects, arising from tight budget conditions of governments
and increasing demand for funds for other uses. Further, low demand for
alternative fuels reduces the business incentive for commercial suppliers
and in the event of supply constraint; the supply to the poor is greatly
affected, thereby forcing them to return to the old, traditional systems.
Thus the energy poverty issue rejoins the supply security problem that has
an equity dimension.
The technology intervention option through improved cooking appli-
ances has seen a mixed fortune so far. According to UNDP-WHO (2009),
only a third of the biomass-using population in the world is using improved
cooking stoves and about two-thirds of those using them live in China and
another 20 per cent in other Asia-Pacific countries. But Sub-Saharan

Intervention options
Changing pollution Modifying living Changing user

source conditions behaviour
Reduced exposure
Improved cooking Improved
through better
devices ventilation
device operation
Improved kitchen Reduced exposure

Alternative fuel-
design and stove through smoke
cooker combinations
placement avoidance
Reducing firing needs

(e.g. solar cooker,
solar water heater)
Source: Based on Salisu et al. (2012).
Figure 19.12 Intervention options for reducing health impacts of solid fuel

use
Africa, where 80 per cent of the solid-fuel using population lives, accounts
for only 4 per cent of the improved cooking stove-using population. This
implies that the region with most needs has not benefited much from
this intervention. Foell et al. (2011) argue that, despite the gravity of the
problem, global attention on clean cooking and heating energies has been
relatively low compared to that for electrification. This is evident from the
IEA (2011) estimate of investments in energy access. IEA (2011) estimated
that $9.1 billion was invested in providing access to energy in 2009 – of
which only $70 million went to provide advanced biomass cooking-stoves
(benefitting 7 million people) and the rest was used in providing access to
electricity to 20 million people. Electricity accounts for a minor share of
rural households’ energy needs and electricity is unlikely to be competitive
with traditional firewood (or biomass-based fuels) used by the poor for

cooking purposes. As traditional solid biomass fuel imposes little private

monetary cost burden, the poor will prefer to use this when they cannot
afford modern fuels, although these fuels impose heavy social costs. Thus
a rebalancing of priorities and significantly higher investment in clean
cooking energy supply is urgently required.
There is a further window of opportunity in this respect. As solid fuel
is a major source of greenhouse gas emission, any intervention to reduce
the pollution also brings climate change benefits. Therefore, this potential
co-benefit opens up opportunities for accessing carbon finance for miti-
gating interventions. There are initiatives in this respect but more needs to
be done to face the challenge.
6 CONCLUSIONS
The issue of energy poverty and consequent health impacts have sig-
nificant economic and social implications. The poor in many developing
countries are forced to rely on such dirty options due to their economic
conditions, and the continued reliance on such fuels pose greater public
health risks due to population increase. Energy poverty has a significant
gender bias and inflicts disproportionate social inequity through health
impacts, occupational hazards and reduced human capital development
potential. There is also significant loss of social welfare and ultimately
this reduces the prospects for economic development of these countries.
Although interventions have been attempted in the past, the level of
investment and the rate of success are not encouraging. Greater efforts are
required to face the challenge. Fortunately, the climate co-benefits of the
interventions can be exploited to access carbon financing for such inter-
ventions. More efforts will need to be directed to the poorer countries so
that a change becomes visible.
NOTES
1. For example, the Indian Planning Commission used to rely on such norms.
2. In some climatic conditions heating may also be an important source of energy demand.
3. It is important to mention that the quality of data on this subject is relatively poor,
although major efforts are being made by the international organisations to improve the
situation. The data quality is affected, among others, by the distributed and dispersed
nature of the population being considered, lack of any administrative arrangements for
systematic records on traditional energies, definitional issues, limited availability of com-
prehensive surveys, and poor communication and infrastructure facilities. This aspect
needs to be kept in mind with respect to any analysis on the subject.
4. See also UNDP-WHO (2009) for a detailed review of energy access.

5. The details of the above classification are indicated in UNDP-WHO (2009), Annex 2,
Table 13.
6. The horizontal axis is presented in logarithmic scale to capture the wide range of income
variation across countries.
7. This section is largely based on Bhattacharyya (2012).
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20. Ethical dimensions of renewable energy
Hugh Dyer
Our sense of insecurity with respect to energy is enough to warrant con-

sideration of how relative energy security might be obtained, yet the most
obvious source of insecurity is our collective failure to plan adequately for
inevitable changes, which will be forced upon us sooner or later. On the
assumption that justice and equity must underwrite the feasibility of any
energy strategies, we need an ethical framework for energy which includes
as a central concern the lack of human security in respect of the allocation
of limited resources. For the sake of our common humanity, and for pos-
terity, there appears to be a clear moral imperative for pursuing renewable
sources of energy. At the same time, political and economic trade-offs
suggest this has not yet been taken seriously.
It seems clear enough that the pursuit of any meaningful energy secu-
rity policy will require anticipation of future post-carbon scenarios. This
requires a perspective on ‘the age of petroleum’ as only a recent and rela-
tively short-run phenomenon in the long run of human energy supply (up
to the late 19th century provided by biomass and animate labour, and now
in the 21st century increasingly by renewables). The alternatives to fossil
fuels clearly exist, though it ‘will take a new industrial revolution’ (Scheer
2002) or an ‘energy revolution’ (Geller 2002). At the same time there is cer-
tainly evidence of growth of electricity, heat, and fuel production capacities
from renewable energy sources, including solar, wind, biofuels, hydro-
power, and geothermal, etc, which will be discussed below in an ethical
context. Heinberg notes that the 21st century ushered in an era of declines,
in a number of crucial parameters: global oil, natural gas and coal extrac-
tion; yearly grain harvests; climate stability; population; economic growth;
fresh water; minerals and ores, such as copper and platinum.
To adapt to this profoundly different world, we must begin now to make

radical changes to our attitudes, behaviors and expectations . . . the cultural,
psychological and practical changes we will have to make as nature rapidly
dictates our new limits (Heinberg 2007).
Thus moral issues arise as the idea of a post-petroleum economy gains

new currency as a security issue. Some years ago, intergovernmental
bureaucracies (e.g. UNFAO 1982, ‘Planning for the post-petroleum
economy’) were addressing what now seems a novel and urgent issue,
443

perhaps because the sense of urgency has re-emerged in the confluence of

energy and climate concerns. Both producers and consumers of energy
have already taken some steps to reflect concern with energy insecurity,
by experimenting with different practices (recycling, improving effi-
ciency, slowly introducing new technologies, attempting to manage the
energy situation collectively, etc), and yet a remaining element of denial
is reflected in the slow pace of change. Even market actors who might
otherwise be thought to hold neutral views on energy sources per se are
becoming agitated about the potential economic costs of delayed action
on energy policy: institutional investors are now pressuring govern-
ments to act clearly and promptly (Fogarty 2012). It seems clear that
maintaining current assumptions about economic growth while address-
ing climate change will at the very least require prompt application of
new technologies and a regulatory and fiscal environment to support
them (Sachs 2008). This suggests a fairly radical shift of practices, and
it remains to be seen whether currently familiar assumptions about eco-
nomic growth and energy consumption will survive. Given the range of
issues implicated in a discussion of renewable energy, there are various
links here to discussion in other chapters in this volume on Energy
Security Policy and Democracy Chapter 2); Resource Conflicts (Chapter
4); Energy, Climate Change and Conflict (Chapter 15); Energy Poverty:
Access, Health and Welfare (Chapter 19); Low Carbon Economy and
Development in Africa (Chapter 21); Centralized vs. Decentralized
Energy Systems (Chapter 22); and Human Security and Energy Security
(Chapter 23).
Clearly energy is central to our lives. Macfarlane (2007) calls it ‘the issue
of the 21st century’. Kimmins (2001, 31) notes that ‘any consideration of
the ethical aspects of these efforts will, therefore, involve an analysis of
energy’. Interestingly, he speaks of a ‘universal vision’ in respect of energy
ethics: all potential solutions to individual energy questions involve a
social cost, an ethical dilemma and an impact on the way other problems
are resolved. Thus, they can only be looked at within a broader consid-
eration of the functioning of the world system of which energy is but one
intimately woven component (Kimmins 2001, 35). This is at odds with the
typically narrow national perspectives of state governments where energy
is seen as fundamental to a way of life and our national security. Kimmins
also captures the intergeneration and future-oriented requirements for
approaching energy policy in saying that ‘many ethical issues arise as a
result of unequal access to energy and of the environmental repercussions’
and this requires ‘that we consider the consequences for future generations
of satisfying the energy needs of the present’, while also pointing clearly to
the long-term requirement for renewables:

Ethical dimensions of renewable energy 445
The only question is how rapidly we should move to such sources and what mix
should be used in various parts of the world over time’ (Kimmins 2001, 37–38).
As an indication of how the ethical issues are set in an political-economic

context, comments from a regional conference suggest that ‘ethics of
energy’ required that people ‘have access to affordable and reliable supply
of energy for their basic needs’ (UNESCO 2007, 3). Yet how such energy
is supplied remains an open question – for example, nuclear energy is on
the list of alternatives. As Shea notes:
tightness in the market has re-ignited the debate over alternative energy sup-
plies such as biofuels or solar power not to mention a renewed interest in
nuclear power (Shea 2006).
We should note that a negative experience in Japan and reaction to it in

Germany has tempered enthusiasm in the latter. As we will see below bio-
fuels and other renewable can also present difficulties, and if some support
for the nuclear option comes from unlikely quarters (James Lovelock, of
Gaia fame) it remains controversial due to significant ecological issues,
whatever its short-term appeal as a panacea for addressing low-carbon
energy security. The UNESCO ethics report also raised doubts over privi-
leging human interests, and advocated ‘harmony with nature’ (UNESCO
2007, 3). It is noted that earlier negotiations indicated ‘objections of
certain countries to the development of a potentially binding commitment
on environmental ethics that might relate to economic issues’ (UNESCO
2007, 4). It was questioned ‘whether we could really depoliticize choices
about energy’, and indeed it seems strange to ‘depoliticise’ an issue as
central to the political-economy as energy, except from a purely techno-
cratic perspective. Certainly the human-environment relationship is facing
considerable challenges, which renewable energy may help to address, and
the challenge is in large measure an ethical one (Crist and Rinker 2010).
So if the political domain extends to include our ethical concerns, then it
is not surprising that as ‘fossil fuel supplies were dwindling and climate
change was accepted as a reality, clean renewable energies, like wind
energy, geothermal, wave, tidal, hydropower, and photovoltaic were the
way of the future’ (UNESCO 2007, 5).
Not surprisingly, the energy mix in any country ‘depended on the
existing governance and the international sourcing or supply chain’, and
there is:
already a large population in lesser developed countries who did not have good
access to conventional technology such as electricity and fossil fuels (UNESCO
2007, 8–9).

This perspective appropriately challenges the notion that energy security

is an issue of the future – it is clearly an issue for many of us now, and
will soon be an issue for all of us. Providing such energy security through
renewable sources is a challenge, though the ethical requirements involve
an ecological context as much as an economic one. Already renewable
sources of energy account for a fifth of electricity generation, and that will
increase to a third in the next decades, but overall energy consumption
continues to rise and it isn’t yet clear that renewable sources can meet the
demand. Baer et al. identify the basic dilemma in noting that ‘there is no
road to development, however conceived, that does not greatly improve
access to energy services’, and yet there is ‘not enough “environmen-
tal space” for the still-poor to develop’, hence the emergency situation
requires ‘a wholesale reinvention of the global energy infrastructure on
the basis of low-emission technologies’ (Baer et al. 2007, 23–26). To the
extent that this dilemma is now recognised in political debates, and to
some extent in policy initiatives, there is already evidence of an ethical
turn and its structural implications. This is the clearest indication that
the ethics of renewable energy are tied closely to the pursuit of energy
security.
ANTHROPOCENTRIC AND ECO-CENTRIC

MOTIVATIONS
A key distinction underlies the difficulty of squaring the distribu-

tional demands of economic and ecological perspectives on ethics.
Anthropocentric (human-centred) and eco-centric (ecologically centered)
perspectives represent a significant schism in both political theory and
moral philosophy. This gives rise to rather different perspectives in ethics
and politics. The ethics of renewable energy draws on both perspectives,
even if they do not sit comfortably together. One (familiar) perspective is
instrumental in its approach to non-human nature, and the significance
of renewable energy, understood in terms of human interests in isolation.
The other is more holistic, encompassing both human and non-human
interests within a wider ecological context. A possible connection between
the two perspectives is that human interests may be best (or only) met
through adopting the more holistic understanding of our situation. Thus
one view is apparently ‘realistic’ in political terms and consequentialist
(ends-oriented) in ethical terms, the other apparently more ‘idealistic’ in
political terms and deontological (means-oriented) in ethical terms. In fact
there is more common ground in both practices and pragmatic thought
than this distinction suggests, but the schism in traditions of thought

and practice is obvious enough. A social-constructivist perspective on

the ethics of renewable energy would point to common ground in ethics
and politics, where both involve negotiation of sorts – we should note
that morality is normative ethics: ethical positions supported by social
consensus or norms. This sociological perspective involves communi-
ties of people creating or ‘constructing’ their own forms of knowledge,
amongst themselves in collaboration, thus developing a culture of shared
meanings – in this case about energy sources and uses. This seems a
quintessentially political and pragmatic process, if sometimes dressed in
the apparently high-minded clothing of ethics to secure the claims being
made in what are otherwise political exchanges. As always, our political
exchanges about interests are also laden with values. In ethical terms, an
anthropocentric view follows the political logic of distributional issues but
does so only with reference to equity among humans, where an eco-centric
approach will also take into account the balance in the ecosystem of which
humans are a part. For renewables, ecosystem balance suggests the lighter
touch of relatively passive energy systems (such as solar). However, such
a holistic perspective also requires considering the whole supply chain of
components for renewable systems (such as energy intensive aluminium)
such that ‘green products’ are produced by a ‘green process’. Being con-
sistent and coherent is a challenge for both ethics and politics. If there are
limited opportunities to engage ethically with ‘others’ and the ‘market
place’ for empathy is troubled by imperfect knowledge, then individuals
may have difficulty matching supply and demand for ethical commitment
as much as for sustainable energy.
NATURE AND RESOURCES: PEOPLE, STOCKS, AND

FLOWS
Since our interests (and values) are not always or only static, delimited by
place and time, the significance of our ethical stance on renewable energy
colours our political negotiations. The resulting decisions or actions will
have implications beyond a single national society, and beyond a single
generation of any society. So our attitude to non-human nature requires
the longer, wider view that ethical perspectives are generally better at
expressing than political perspectives constrained by bounded sets of
interests or electoral horizons. The question of which humans we’re
talking about is of course a central feature of both ethics and politics
at the global (and often local) level. The context for renewable energy
is the set of people (here and there, present and future) that depend on
the same natural resources. From an anthropocentric viewpoint, nature

exists only to provide for our needs, with needs defined in terms of our
economic practices and normally confused with our wants and expecta-
tions. The natural resources that supply these needs may be viewed as
either stock or flow resources, with stocks being finite and flows infinite
(unless disrupted). If nature is provident, it also has its limits – and we’re
getting closer to them all the time. Importantly, we are not all in the
same situation, with some feeling the limits more immediately as others
buy time. We might view some stocks as being flows, if they renew them-
selves within human timescales (such as crops or forests), whereas most
stocks will start to run out at some point (peak oil). Renewable energy
finds itself in this mix of circumstances, such that if a source of energy
qualifies as renewable in some sense it at least shouldn’t run out, but its
availability in time and place may still vary greatly. Although it might
be possible to provide abundant energy, for some time, for some people
(for some cost to the ecological balance – of the climate in particular), it
won’t be possible to provide so much for all, for ever. Thus if renewable
energy practices are not deployed in the right place at the right time,
sustainable availability of energy is in question, and it is precisely such
distributional issues which make renewable paths to energy security both
ethical and political. Thus the moral context for energy is a matter of
distributional justice as between the ‘haves’ and the ‘have-nots’. If uneven
development raises familiar distributional issues across populations, in
terms of intergenerational equity the ‘have-nots’ may be future genera-
tions. Energy security, importantly, is generally presented as an issue of
increasing supply to meet increasing demand. The distributional issues
are typically buried under the priority of national economic growth; if it
is already difficult to achieve equity in national distribution, how much
more so trans-nationally in a globalised economy. So distributional
aspects of energy supply are thus determined as much by the structure of
‘state sovereignty’, and national authority structures of varying degrees
of accountability, as by markets. Barnett notes that energy security is
just ‘the use of national power to secure supplies of affordable energy’
in support of economic growth (Barnett 2001, 35), where ‘economic and
energy security takes priority over environmental security’ (Barnett 2001,
76). This is how energy concerns may be forced into a conventional secu-
rity framework, and why renewable energy in particular is more challeng-
ing. However, the long chains of energy production, supply, and demand
are not conducive to national energy independence. So, the ethical impli-
cations of such structural features may adjust as both states and markets
are encompassed in wider social trends, including the increasing use of
renewable energy.

RENEWABLE SHARE OF ENERGY PRODUCTION: A

REALITY CHECK
In terms of electricity generation energy sources, renewables comprise 20

per cent and rising, with nuclear at 12 per cent, leaving the bulk of elec-
tricity produced by fossil fuels which are heavily subsidised. The World
Energy Outlook (2012) up to 2035 suggests that renewables growth in
the OECD will come ‘mainly from wind (47%), bioenergy (16%), solar
PV (15%) and hydro (11%)’. In non-OECD countries hydro will account
‘for 42% of the increase in renewables, but wind (25%), bioenergy (16%),
and solar PV (10%) also play an important role’. Investment in generation
capacity will be more than 60 per cent renewable, ‘principally wind (22%),
hydro (16%), and solar PV (13%)’. ‘A steady increase in hydropower and
the rapid expansion of wind and solar power has cemented the position
of renewables as an indispensable part of the global energy mix.’ What
such encouraging developments may hide is a fundamental (and familiar)
ethical issue: over a billion of our fellow humans have no access to elec-
tricity, renewable or not, and sub-Saharan Africa in particular reflects the
great inequality of energy access. The World Energy Outlook also indi-
cates the increasing use of limited water resources (ironically a potential
renewable energy source itself) in biofuel crop production, as well as the
production and distribution of fossil fuel energy (World Energy Outlook
2012). In such future scenarios, running up to 2050 (Shell 2008, 36), the
anticipation is that renewable energy will gain significance due to public
pressure, local initiatives and industrial concerns with predictability.
CONTEXTS: DIFFERENT TYPES OF RENEWABLE

ENERGY AND THEIR ETHICAL IMPLICATIONS
The political-economic circumstances are ripe for renewable energy devel-

opment, and the political will to support them is emerging, but the
ethical implications are typically more complicated than single policies
or one-size-fits-all solutions may suppose. While each type of renewable
energy has somewhat different implications, it is likely that all types will
be needed in some context. Furthermore, they all have in common the
prospect of meeting ethical demands whether human-centred or ecologi-
cal; and it is perfectly possible and pragmatic for them to do both. If the
global capitalist system has something to answer for in both ethical and
ecological terms, the central actors in that system inhabit the same planet
as everyone else (and so will their descendents). They also know which
side their bread is buttered on, and which way the wind is blowing; like

opulist politicians, market players will respond to clear signals. If the

p
signals are not clear however, then political-economic alignments and
agreed regulatory frameworks are less likely, and this is why achieving an
ethical appreciation of renewables is vital to their successful implementa-
tion. The Investor Network on Climate Risk (comprising 100 institutional
investors with assets of more than $11 trillion) has called on governments
to take action on serious climate dangers and to increase clean energy
investment, due to purely financial risks’ (Fogarty 2012). This is one
of many indications that actors of all kinds (not just governments) are
seeking a clearer view of the future energy scenario in which renewables
are a dominant feature. Even where government action is either possible,
expected or necessary, there is variation: while the US federal government
is hesitant, the government of California (it’s most significant state) is
investing heavily in green energy (Carroll 2012).
Similarly, cities are taking the lead over national governments in many
cases. A brief examination of a range of renewable sources and technolo-
gies will illustrate the issues, concentrating on biofuels as an illustration,
but also pointing to the ethical implications of other kinds of renewable
energy.
Biofuels
Biofuels include plant material such as wood, crops, and their waste or
residue, which are potentially carbon-neutral in so far as the growing
plants fix carbon at the same rate that carbon is released in their com-
bustion. Biofuels refers to the conversion of biomass into liquid fuels
for transportation, and is related to other terms like biopower (burning
biomass directly, or converting it into gaseous fuel or oil for electricity
generation) and bioproducts (conversion of biomass into chemicals to
make products that would otherwise be made from petroleum). If biofuels
are an important part of our past, they are also a key part of our future:
‘traditional biomass’s share has declined slightly, while modern renewable
energy’s share has risen’ (REN21 2012).
Biofuels emerged as a potential ‘silver bullet’, solving at once the
problem of energy security and security from climate change, but were
quickly mired in controversies arising from the energy-food-water nexus.
This controversy around biofuels as an alternative energy source has an
obvious moral dimension. Not surprisingly, as with other renewables, the
morality and the practicality of biofuels are closely connected. It seems
clear that initial enthusiasm for biofuels has been tempered by unintended
(or unrevealed) consequences, including the net energy/environment ben-
efits, and the impact on food crops with knock-on effects on the price

and availability of food. The EU therefore reconsidered, though didn’t

suspend, its targets in this area: ‘Both the EU Environment Commissioner
and Defra’s own chief scientist today went on record to say that current
plans to vastly increase the amount of fuels such as bioethanol and biodie-
sel might need to be reconsidered’ (Greenpeace UK 2008). US policy
remains tied to domestic political commitments, particularly on ethanol
production in parts of the country with electoral influence (Congress
approved a five-fold increase in use of biofuels in 2007), but is also facing
opposition:
. . . a reaction is building against policies in the United States and Europe to
promote ethanol and similar fuels, with political leaders from poor countries
contending that these fuels are driving up food prices and starving poor people.
Biofuels are fast becoming a new flash point in global diplomacy, putting pres-
sure on Western politicians to reconsider their policies (New York Times 2008).
A low rate of Energy Returned on Energy Invested (EROEI), heavy use of

water, and fossil fuels needed in ethanol production all created a complex
food and agriculture problem. There was little consideration to how
ecological and sustainable biofuels might be, given soil degradation and
fertiliser requirements:
on the face of it, growing biofuels to support the car habit is a suicidal prospect
. . . What is the morality in light of the growing numbers of mouths to feed?
(Energy Bulletin 2008).
The political (and ethical) stakes involved are quite high, with the EU
Commission having to reject claims that production of biofuels is a ‘crime
against humanity’ (Agence France Press 2008), even with the relative pro-
portion of biofuels in the energy mix being so far limited.
Policies such as the European Renewable Energy Directive, through
which European Union (EU) states committed in 2008 to source 10 per
cent of their transport energy needs from renewable fuels by 2020, have
‘backfired badly’. . . If a biofuels technology meets all the proposed
environmental and ethical standards, then there is a ‘duty’ to develop it
(Gilbert 2011).
Second generation biofuels, as with other advanced renewables, may
avoid some of the apparent difficulties. Over the long term biofuels will
likely continue to be part of the renewable energy mix, but the problems
illustrate the moral issues surrounding energy security, particularly with
respect to distributional justice. If there are still potential advantages to be
gained from biofuels, these may not be equally distributed: currently, we
are only on the receiving end of the negative effects of the global biofuels

trend, instead of the positive – the country is being forced to absorb the
inflationary high food prices, without getting the benefit of direct invest-
ments in rural areas and the associated job creation. It would seem that
the key to making sense of these suggestions is for policymakers to re-
evaluate biofuels through the prism of rural and industrial development
rather than simply employing the somewhat populist food/fuel framework
(Creamer 2008).
Clearly biofuels can serve a range of purposes from substituting petro-
leum fuels to encouraging agriculture and rural development, but this seems
to water down the energy security strategy often implied and completely
undermines it if the net use of energy doesn’t actually reduce petroleum
dependency. There are economic motives here, and even old-fashioned
energy efficiency (‘negawatts’) could be significant for energy and climate
alike, but the ‘rebound effect’ of increased access and lower prices for fuel
leading to greater consumption could cancel 26–37 per cent of any gains
(Economist 2008), but the ecological and moral motives seem somewhat
distant, and the political coherence of energy security is thus limited.
A focus on a narrow area of policy concern without a wider perspec-
tive is likely to lead to problems, both political and ethical. While the
‘configuration and context of business at the global level’ is transforming
and there is ‘a growing need for sustainability coupled with growth’ there
are ‘some tensions, however, between the imperatives for developing renew-
able and biofuel resources, and the imperatives for advertising and promoting
high energy consumption luxury products’ (UNESCO 2007, 17, emphasis
added). Some tensions, no doubt. As the promise of advanced biofuels is
explored, the problems of conventional biofuels may become irrelevant
over time (VLAB 2010). Nevertheless, as biofuels seem most obviously
linked to both human-centred and eco-centred development, ethical issues
will remain close at hand, and consequently ethical principles for biofuels
policy-making are being established (Buyx and Tait 2011, 633).
Hydro
Hydro (water) power includes a range of renewable energy production,

including large-scale hydro-power dams, small-scale low head hydro tur-
bines, micro-hydro, and related pumped storage plants which use water to
store potential electricity. Hydro, utilising an existing flow resource, has
the potential to produce unlimited zero-carbon energy. At the same time,
it may involve expensive infrastructure and its potential is so far less fully
realised in the developing world than in the industrial or industrialising
world – at present China is the leading hydro power producer. However,
the consequences of large-scale hydro dams for the ecosystem, and for

local and upstream/downstream human populations (who may not even

benefit from the energy) means that large-scale hydro may not be viewed
as renewable from the wider perspective on sustainability. This immedi-
ately raises the ethical issue of ‘inequity in distribution of impacts among
different social groups’:
Diversion of the river resulted in loss of water sports (for high-income groups
both local and remote), loss of historical monuments (for remote high-income
groups) and recreation losses (for local poor). Removal of forest cover leads
to loss of non-timber products (for local poor) and carbon storage (for remote
high-and low-income groups). Loss of home garden productivity was borne by
local poor groups. Benefit of the project, generation of 145 GWh annually, was
a gain for the grid connected groups. (Gunawardena 2010, 726)
Issues of population displacement, land use, and the complex water-energy

relationship create tensions, as noted in the IEA report ‘World
Energy Outlook 2012’. So for example, ‘large hydro’ is excluded from
measurements of renewable contribution:
. . . total investment in renewables excluding large hydro last year increased
17% to a record $257 billion, a six-fold increase on the 2004 figure and
94% higher than the total in 2007, the year before the world financial crisis,
says the UNEP report, Global Trends in Renewable Energy Investment 2012
(REN21 2012).
Such a substantial contribution to energy investment and production may

raise as many issues as it addresses, when viewed from an ethical perspec-
tive, but as with other renewables the potential advantages of hydropower
must not be dismissed simply because political and economic failings have
left ethical issues in their wake. In particular smaller-scale hydro power is
both decentralised, providing electricity locally as well as potential surplus
for a grid, and can have a low impact on the environment.
Wind
Wind, like micro-hydro, can produce energy on a small local scale which is
likely to be more environmentally friendly overall, as well as offering great
potential as a mainstream source of grid energy as is currently demon-
strated by wind farm development in many parts of the world. Large-scale
wind farms or plants carry with them both the economic advantages of
scale, and could compete with other significant energy infrastructures, but
equally with the controversies of any large development. On shore wind
farms, or even single wind turbines, can spark off typical objections on the
grounds of visual and other impacts on local environments which resonate

in local and national politics (the NIMBY problem – ‘not in my back-

yard’). Off shore wind farms, being to some extent out of sight and thus
out of mind (for most of the population) are therefore less often objected
to on the grounds of intrusions into settled environments. However, even
when environmental amenity arguments don’t play strongly in the balance
of concerns, concerns about the relative costs and benefits (on or off
shore) find their way into public debate. If, as for most renewables, there
are initial costs and a need for regulatory and financial support, this must
surely be weighed against the long-term costs of climate change and energy
insecurity.
While there are ambitious government targets to increase the share
of renewable energy in many countries, it is increasingly recognised that
social acceptance may be a constraining factor in achieving this target.
This is particularly apparent in the case of wind energy, which has become
a subject of contested debates in several countries largely due to its visual
impact on landscapes (Wüstenhagen et al. 2007, 2683).
Wind farm development illustrates the significance of perceived fairness
in accepting renewable energy, such that the eco-centric concerns with
environmental justice are balanced with anthropocentric concern with
procedural justice.
Decisions concerning the siting of infrastructure developments or the
use of natural resources have the potential to damage a community’s social
well-being if the outcomes are perceived to be unfair. Justice is accepted as
central to the good functioning of society with fairness being an expecta-
tion in day-to-day interactions. Outcomes that are perceived to be unfair
can result in protests, damaged relationships and divided communities,
particularly when decisions are made which benefit some sections of the
community at the perceived expense of others (Gross 2007, 2727).
Geothermal
Geothermal energy, derived from underground sources, seems to avoid

some of the political difficulties of visual impact. For local (residential)
heating energy can be drawn from shallow ground with few visible signs
of the source. Larger-scale use of geothermal energy draws on either hot
water or hot rock for heating, or deploying the heat (directly or indirectly)
to drive steam turbines for electricity generation. This might also attract
objections on the grounds of visual impact, but not more so (perhaps less
so) than other forms of electricity generation. As with other renewable
sources, the absence of unpleasant by-product or pollution should carry
public opinion, even if the more serious concerns of global climate change
do not.

Oceans
The oceans, covering most of the planet’s surface, are an important factor
in renewable energy provision as indeed they are in all aspects of our
relationship with the environment (oceans are also a significant carbon
sink, for example). Like geothermal energy, ocean thermal can provide
a ready source of heating for conversion. Unlike geological sources, and
more like hydro energy, oceans can also provide a mechanical source
of energy in tides and waves. Barrage or dam systems can convert tidal
energy into electricity via turbines. Waves can power floats or oscillating
water column systems to drive hydraulic pumps. As these are typically on
or near shorelines, the visual impact issue arises, as does cost – though
the same moral imperatives should bear on the political and economic
calculus.
Solar
Solar energy technologies can provide heat, light, hot water, electricity,
and even cooling. There is a considerable global industry in photovoltaic
(PV) systems which produce electricity directly from sunlight, and solar
seems an obvious solution to both energy and environmental issues. Solar
PV, though advancing steadily towards a mainstream source of renew-
able energy, is dogged by political manipulations of ‘feed-in tariffs’ which
determine the cost and benefit of linking distributed solar PV energy
production to the electrical grid. Ideally renewables would not need such
support (and may not need it in time), but like all new technologies the
start-up costs are considerable, and in the case of energy supply there are
also infrastructural issues which clearly implicate the public interest in
diverse energy supplies.
The link between ethics and renewable energy is short and clear: we do
not have the right to destroy the conditions for life on earth by continued
use of climate-damaging energy sources; we must replace them with clean,
safe, abundant and geopolitically-benign renewable energy: the mecha-
nism proven to deliver the fastest, lowest-cost renewable energy deploy-
ment is the feed-in tariff (FIT), often referred to in the US as the advanced
renewable tariff (ART) (Mendonca 2007).
Another common and relatively uncomplicated and inexpensive tech-
nology provides immediate domestic hot water using solar energy through
heat conversion, and is a common sight on rooftops in warm climates. Of
course like other heat sources, it can be used to drive steam turbines for
electricity generation, and large-scale desert solar electric plants have been
developed. But as a low-tech option solar energy is equally attractive, and

this endless resource can be used by simply allowing the sun to provide
passive heating and lighting through intelligent design (rather than
keeping both out); and there are somewhat more advanced applications
of such technology for industrial and commercial heating and cooling. If
the sun seems such an obvious source of energy, solar power, like wind
power, faces frequent objection on the grounds of intermittent availabil-
ity. However, since it is normally the resulting electricity supply which is
expected to be available on demand around the clock (day and night, rain
or shine, calm or storm), the issue easily transfers itself to the mix of energy
sources contributing to the grid and its storage capacity – for example, one
aspect of hydro power is its use as a means of storage by absorbing any
excess electricity to pump water up to a reservoir, and easing the peaks of
grid demand through opening up the flow to turbines as required.
Other Options: Hydrogen, Nuclear, Waste
Much has been made of the potential for hydrogen to replace fossil fuels,
as it is portable and produces water rather than carbon as a by-product.
Hydrogen fuel cells are being tested for transportation applications,
operating in place of a battery to provide electricity, and might also be
used for heat and electricity for buildings. The source of hydrogen and its
production, however, may detract from this apparent panacea. Hydrogen
is extracted by heating hydrocarbons – mostly natural gas, as well as
methane or gasoline – though it can also be produced from water by elec-
trolysis (requiring electrical energy up-front of course). Interestingly, some
algae and bacteria can produce hydrogen utilising solar energy. So while
hydrogen may not provide a ready renewable energy solution, its port-
ability could make it an important energy carrier, and a potential energy
storage medium for renewable sources like wind and solar.
Nuclear power, if carbon neutral in terms of its direct emissions, is not
renewable in wider ecological terms because of long-term (very long-term,
given half-life of fuels) waste management issues, and short-term eco-
logical risks, including those directly relating to human health. Kristin
Shrader-Frechette (2011) has argued extensively about the miscalcula-
tions of energy planning that make nuclear power seem feasible or even
sustainable, and advocates renewable as the only option for the future.
It remains that if climate change is not addressed promptly (which seems
likely) then nuclear power may be the least worst option in the medium
term. In this context, the Nuclear Energy Agency argues that the ‘critical
path structure’ should include ‘concurrent risk, economic, and environ-
mental impact analyses . . . for all technologies and proposed actions for
the transition to a post-petroleum economy’ (Nuclear Energy Agency

2004, 37). However, while nuclear power remains under consideration,

and hydrogen technology emerges as a potential portable fuel (though
electricity intensive in production), there are many more positive solutions
to the challenge.
Utilising our own existing waste, both domestic and industrial, is
another source of energy. While recycling waste in the energy context can
only be a good thing, it depends on generation of the waste in the first
place. An ecological approach would reduce waste overall, and thus also
reduce that available for energy production.
INFRASTRUCTURES: ON AND/OR OFF GRID?
Much of what passes for insurmountable difficulty in renewable energy

technologies rests on our current expectations and traditional practices.
Both may have to change somewhat, if we are facing a dual crisis of energy
security and climate change, and exacerbating ethical shortcomings.
Current energy infrastructures were designed for and are still dominated
by fossil fuels, though could be supplied by renewables. Modern energy
infrastructures offer a range of possibilities, from large-scale smart grids
to small-scale smart meters, which contribute to efficiency (if not immedi-
ately encouraging simple sufficiency). If centralised energy systems make
sense in dense population areas, distributed energy resources have such
great advantages that they may dominate the future. For many of us, tra-
ditional and distributed energy, or none at all, is the norm. That in itself
raises the central ethical issue in relation to energy, which is its distribution
across the human population and not simply across the economy. In these
more deprived circumstances, even modest (and thus ecologically sustain-
able) forms of energy supply greatly improve life chances (refrigeration for
medicines) and life experiences (lighting for reading). Very basic wind and
solar energy technology may provide for household needs. Small local grid
systems may provide community-level energy from a shared renewable
source. Such distributed and decentralised energy supply may aid social
and economic development with relative independence from centralised
supply grids and urban centres. Development may end up involving a
combination of both, since a variety of small, modular power-generating
technologies can improve the operation of electricity delivery systems.
Portable energy storage also supports the many aspects of increased
mobility in the modern world – not least in the area of information and
communications. If many small sources of energy are better suited to a
smarter way of life, then ‘energy harvesting’ from human motion, or the
scavenging and recovery of residual energy, may prove to be the wave

of the future. For the moment, it seems our ravenous appetite for large
volumes of both material and energy consumption can only be satisfied by
large-scale grid systems and energy intensive transportation.
CONCLUSIONS
UNESCO discussions suggested some realism about the application of
ethical principles on renewable energy: ‘although a normative declaration
would be nice, it was not feasible in the current political environment’,
even though this suggests the need for a ‘global eco-ethics’ (UNESCO
2007, 7–8). However it is precisely the point that energy security dilemmas
are seen as a challenge. In the case of renewable energy the challenges are
both human and ecological, since meeting ecological expectations in some
respects may not guarantee full human participation, which in itself is an
ecological issue.
Conventional energy technologies and deployment approaches cannot
be relied upon to eliminate energy poverty in Africa. Innovations in energy
access are necessary (Agbemabiese et al. 2012).
The ostensible aims of governments (wealth, health, security) look
different from an ecological perspective, which may lead to a change in
political and economic practices, as well as to our ethical consciousness.
Minteer (2005) suggests that such reconsiderations of the public interest is
a necessary aspect of linking ethical questions to policy debates.
Ethically, for reasons of environmental justice and towards meeting the goals
of sustainable development, further research into alternative energy sources
is an imperative for all nations capable of such research and development. A
failure to increase research into alternative energy sources is unethical, in that
it not only favors the current status quo in relation to energy infrastructure,
and among other reasons, it increases the burden of costs for future generations
in the both the clean-up of higher levels of atmospheric carbon as well as the
inevitable costs to further innovate. However it is neither wise, economical, nor
just to proceed developing certain sectors of alternative energy technologies
without a proper analysis of the ethical dimensions of various proposed strate-
gies. (Schienke 2007)
This reflects Hayward’s (1998) argument that environmental values are

supported by enlightened human interests, and furthermore that this link
must exist to promote ecological goods, and that consequently there are
serious implications in fully integrating environmental issues into our
disciplinary concerns. A key aspect of the political barriers to ethical prac-
tices is the tendency to leave everything to a market economy, allowing
current short-term calculations to determine the value of energy sources. It

may require some regulatory intervention, or public and energy-consumer

action to shift the balance of interests in this regard.
While it is true that markets are often excellently self-organising, with
many concomitant benefits, fossil fuels are not sufficiently required to
address the damage that they cause to life on earth, and they continue
to attract large subsidies – in itself a market distortion. Ernst Ulrich von
Weizsacker, founder of Germany’s Wuppertal Institute, referred to this as
‘telling the ecological truth’ (Mendonca 2007).
Hargrove (1989) makes an argument for anthropocentric, aesthetic
sources of modern environmental concern by identifying attitudes that
constrain (‘idealism’, ‘property rights’) and support (scientific and aesthetic
ideals) our ecological perspectives. However, even if such approaches
make renewable contributions to energy security easier to sell politically,
it remains that an ecological ethic more directly reflects the limits we
face. Renewable energy carries with it the prospect of ethical as well as
ecological sustainability.
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21. Low carbon development and energy
security in Africa
Chukwumerije Okereke* and Tariya Yusuf
1 INTRODUCTION
Energy poverty is without a doubt one of the most critical development

challenges facing African countries today. Out of a population of about
a billion, over 547 million Africans do not have access to electricity but
depend on biomass for their basic energy needs (IEA, 2011). Wide scale
energy provision is therefore a vital requirement for achieving the eco-
nomic growth and development aspirations of African countries. This is
more so the case in Sub-Saharan Africa which has the worst poverty in the
world (EIA, 2011).
An equally important challenge facing Africa and the rest of the world
is how to deal with the problem of climate change which is caused mostly
by carbon emissions implicated in energy production and consumption.
Climate change, through its impact on drought, desertification, health and
extreme weather events, will exacerbate energy poverty in Africa and lead
to the further impoverishment of millions (IPCC, 2007a). In fact, worsen-
ing energy security problems is one the most critical ways in which climate
change is affecting, and will continue to affect Africa (IPCC, 2011).
It is clear therefore that the central development dilemma facing African
countries and their development partners today is how to address the
problem of climate change while at the same time pursuing the quest for
rapid economic growth and universal energy access (IEA, 2011; Sokona
et al., 2012). The answer to this dilemma lies, to a large degree, in the concept
of low carbon development. Africa has plenty of cheap renewable resources
that can be harnessed to achieve the triple wins of combating energy
poverty, mitigating climate change and building a low carbon economy.
A low carbon development path for Africa carries the promise of multiple
co-benefits including wider systematic economic resilience, improvement in
health condition, resource conservation, energy security, reduced foreign
exchange need and reductions in budget deficit (Bowen and Frankhauser,
2011; Diog and Adow, 2011; Khennas, 2012). Indeed, the current situation
in many African countries where high cost and carbon intensive energy
is imported through distant transcontinental routes is incongruous with
462

Low carbon development and energy security in Africa 463
reason and basic economics of good development. Pursuing low carbon

development options has the potential to facilitate economic integration
and market access among African countries while also helping the conti-
nent to contribute its quota in helping the global community address the
problem of climate change. That said, harnessing cheap renewable energy
resources in Africa will require appropriate capital, national regulatory
and investment policy frameworks which may not necessarily be easy to
achieve. It will also require an equitable distribution of the cost of transi-
tion to a global low carbon future, a significant aspect of which will have
to come from substantial North-South financial and technology transfer.
2 ENERGY POVERTY IN AFRICA
One of the most significant issues affecting development in Africa is poor

access to modern energy services. Energy access is critical for meeting
many human needs including lighting, heating, cooking and communica-
tion. It also plays a central role in driving productive enterprise such as
agriculture, transport and industrial activities. The link between energy
consumption and economic growth is fairly straightforward and well
established (Abanda et al., 2012; IEA, 2011; Kanagawa and Nakata,
2007). For Africa a key feature of the economic landscape is extremely
poor access to and low consumption of modern energy. This is despite the
fact that Africa has abundant natural resources and is a major contributor
to the world’s primary energy oil production. Africa has about 9 per cent
of the proven world’s oil reserve and accounts for about 12 per cent of
total world oil production (IEA, 2011). The continent has about 7 per cent
and 6 per cent of the world’s total gas and coal reserves respectively (BP,
2012). There is also abundant natural gas, hydro, solar, biofuel, geother-
mal and nuclear energy resources.
Despite these endowments, Africa with its 14 per cent of global popu-
lation accounts for just about 3 per cent of the world’s primary energy
consumption (BP, 2012). Africa has the lowest electrification rate of all
the world at 26 per cent of households, with as many as 547 million people
without access to electricity (EIA, 2011). Accordingly, a vast proportion of
people in Africa depend on traditional biomass fuels from woods, agricul-
tural residue and dung for heating and cooking needs. According to IEA
reports, more than 80 per cent of Sub Saharan African households amount-
ing to 653 million people use biomass for cooking. This has had devastat-
ing consequences for people and the environment. In 2009, more than 1.45
million African lives were lost to household pollution caused by inefficient
biomass cooking stoves. Fewer people died from malaria (IEA, 2011).

On current trends less than half of African countries will reach universal
access to electricity even by 2050. Generation capacity in Africa at 39 MW
per million population is about one-tenth of the levels found in other low
income regions of the world. Per capita electricity consumption in Africa
(excluding South Africa) averages only 124 kilowatt-hours a year, barely
one per cent of the consumption typical in high income countries (EIA,
2011). This is hardly enough to power one light bulb per person for six
hours a day. The number of people without electricity is either static or
increasing because population growth is outstripping the pace at which
households are being connected. In other words, the annual rate of new
connections in Africa (less than 1 per cent) is not keeping pace with new
household formation (1.9 per cent).
Within Africa there is wide variation across the sub regions. In the
recent past, North African countries have made significant advances in
dealing with the challenge of energy access leaving the problem mostly for
sub-Saharan Africa. For example, two out of three Sub Saharan African
(SSA) households live without electricity. In stark contrast, 99 per cent of
North African households have electricity supply (IPCC, 2011). Only 14
per cent of rural Sub Saharan African (SSA) households are linked to the
grid. In comparison, 74 per cent of rural households in Latin America are
connected to the national grid (Khennas, 2012).
In Sub-Saharan Africa, East Africa has the lowest consumption of
modern energy services per capita and this is in spite of the growth of
national economies witnessed in the last decade or so. For example, per
capita consumption of electricity in Tanzania is alarmingly low at 65
kWh. This represents only about 2.4 per cent of world consumption of
2,751 kWh/per capita (World Bank, 2007).The picture is even grimmer for
Uganda. Here, only 10 per cent of the population has access to electricity
and the per capita electricity consumption stands at 44 kWh. Kenya’s per
capita electricity consumption is comparatively better. It is estimated to be
128 kWh (UNEP, 2012).
But the picture is not much different even for large countries like Nigeria
which is widely regarded as one of the two super economies in Africa – the
other being South Africa. It is estimated that well over 50 per cent of
Nigerian’s 152 million population does not have access to electricity (Eleri
et al., 2011; Okoro and Chikuni, 2007). The country, which requires a
minimum of 10,000 MW of electricity to meet her energy demands cur-
rently has a production capacity of just about 3,000 MW. Even though
the installed capacity of electricity is much greater than 3,000 MW,
infrastructure utilization is historically very poor and power supply has
been epileptic as a result of lack of maintenance and unscheduled outages
(Oseni, 2012). Investment needed in the power sector by Nigeria to gener-

ate anything near the quantity needed is estimated at USD20 billion (Eleri
et al., 2010; Okafor, 2008; Okoro and Chikuni, 2007).
While the figures on the number of households connected to the grid
provide a very good indication of the extent of the problem, they do not
tell the whole story. In reality, a high percentage of those that are con-
nected to the grid do not have regular access to electricity due to high
frequency of blackouts and unstable power supply. The World Bank
estimates that SSA households experienced between 91 and 105 days of
blackouts in 2007. There are several instances where communities that
have been connected to the national grid actually never get to enjoy elec-
tric power supply for more than three months in a year. Frequent outages
and load shedding very much characterize the experience of a vast major-
ity of populations and businesses in most sub-Saharan African countries
(Akinbami et al., 2001).
High-cost and unreliable energy services in Africa are a significant
drag on economic growth and competitiveness in the region. Every year,
African households and business spend upwards of USD17 billion on
fuel based lighting that is often of poor quality and hazardous (World
Bank, 2009). The World Bank further estimates that the economic value
of power outages noted above amounts to as much as 2 per cent of GDP
for countries affected. This figure according to the International Energy
Agency (see Figure 21.1 below) will continue to grow unless new policies
and programmes to increase access are implemented.
900
800
700
600
Million
500
400
300
200
100
0
70
80
90
00
10
20
30
19
19
19
20
20
20
20
South Asia Sub-Saharan Africa Middle East

East Asia/China Latin America North Africa
Source: World Bank (2009).
Figure 21.1 Number of people without electricity (actual and projected)

by region under current policies

Beyond low electrification, energy poverty challenges in Africa extend

to inefficient and perilous forms of domestic energy for cooking attribut-
able to a lack of modern fuels and clean cookers. Africa currently has the
highest energy intensity in the world. It uses far more energy for every
dollar of gross domestic product (GDP) than any other region (IEA,
2011). Africa’s inefficient energy system is characterized by energy that
is imported, expensive, environmentally unsustainable and dependent on
coal, oil, wood fuels and natural gas (IPCC, 2011). Massive dependence
on imported fossil fuels consumes a high portion of Africa’s export earn-
ings. Even Nigeria, the region’s largest exporter of crude oil, has to import
refined fuels. Fluctuation of oil and gas prices further complicate the task of
delivering a secure energy supply in the region. Sub Saharan African coun-
tries spent 14 per cent of their GDP on fuel imports in 2000 (EIA, 2011).
The focus of delivering centralized conventional electricity through thermal
power from oil, gas and coal or from large-scale hydropower has not effec-
tively delivered either energy access for poor people or the rate of economic
growth that sub-Saharan African countries aim for (Anozie et al., 2007).
It is generally accepted that for Africa to achieve the millennium devel-
opment goals (MDG) embodied in sustained economic growth leading
to poverty reduction, improved standard of living, adequate and reliable
energy services have to be made available. There is a close association
between reducing the need for poorer households in developing countries
to use biomass for cooking and heating and reaching the MDGs on uni-
versal primary education, promoting sex equality and the empowerment
of women and reducing under-five child mortality. A rapidly changing
climate will however make this task more difficult and further exacerbate
energy poverty in Africa (Ebohon, 1996).
3 CLIMATE CHANGE AND ENERGY POVERTY
The threat of climate change to humankind and to the planet as a whole

has gradually become more evident. Africa is the continent most vul-
nerable to climate change impacts and the least prepared to deal with
its effects (IPCC, 2007b). In fact, Africa is already experiencing severe
negative impacts of climate change on its people, environment and
economy (IPCC, 2007b). These include among others, prolonged periods
of droughts, surface mean temperature increase, reduced agricultural
yield, erratic precipitation patterns, flooding, ecosystem collapse, mal-
nutrition, spread of tropical diseases and deaths. One of the key ways in
which climate change is impacting and will impact Africa is in the worsen-
ing problem of energy poverty (IPCC, 2011).

Climate change and energy poverty has an intimate and complex rela-
tionship especially in the context of developing regions like Africa. First, it
is well known that energy provision is a critical requirement for achieving
economic growth and development. Hence, African countries would need
to vastly increase their energy generation and consumption in order to
reduce poverty, build climate adaptive capacity and achieve their develop-
ment aspirations (Bowen and Frankhauser, 2011; Sokona et al., 2012). At
the same time, it is well known that the vast proportion (up to 82 per cent)
of anthropogenic carbon emissions come from energy related activities,
including electricity generation, transport, building, and industry (IPCC,
2007b). The paradox then is that the effort to achieve development,
which is crucially needed to escape energy poverty and adapt to climate
change, could in turn exacerbate the problem of climate change leading
to poverty (Okereke and Schroder, 2009). Second and related, the global
aspiration to combat climate change has serious implication for available
options for energy provisioning in Africa and other developing countries
(Ouedraogo, 2012).
One important emerging issue in this regard is the reluctance of many
policy makers, international aid agencies and environmentalists to con-
sider the full range of energy options to meet the energy needs of the
poor on the grounds of the need for reducing greenhouse gas (GHG) in
the atmosphere (Sanchez, 2011). A famous case was the controversy that
was generated in 2010 when the World Bank sought to lend Eskom in
South Africa about USD3.75 billion to finance its coal fired power plant
investment project at Medupi. Then (and as of now) the contention by
many NGOs was that the money would have been better used to finance
investment in more expensive but less carbon intensive renewable energy
projects. Sanchez (2011) has also noted that in some cases this imperative
to achieve development in the context of reducing global GHG emissions
may result in the use of uncompetitive options to pursue development
objectives. One example was where a development agency insisted on
using a renewable energy system to pump underground water for drink-
ing and farming even when it would have been cheaper to use small diesel
engines (Sanchez, 2011). Yet, another scenario which has recently gained
currency in literature and public policy relates to situations where efforts
to conserve tropical forests in the context of climate change can deny local
people access to valuable forest products including wood fuel (Okereke
and Dooley, 2010).
Thirdly, climate change, through erratic rainfall, flooding and drought
can have a direct impact on energy infrastructure with a serious impact on
generating capacity. This has already been witnessed in various countries
in Africa where a drastic decrease in precipitation rates has resulted in

severe drought affecting hydropower generation. For example Kenya and

Ghana, both of which currently rely heavily on large hydropower dams,
have experienced significant power shortages in recent years due to unusu-
ally long droughts. Droughts generally lead to massive load shedding and
decreased electricity supply with the result of huge economic disruptions
and losses (UNEP, 2012). Excessive flooding on the other hand contrib-
utes to a rapid build-up of silt in hydropower dams, affecting the amount
of water available for electricity generation.
For developing countries in Africa, the recent food, commodities, and
oil price shocks – all of which are to some degree a resulting impact of
climate change – are already having severe implications for energy access
particularly among the poorest. The World Bank estimated that the high
food, oil, and other commodity prices since January 2007 have reduced the
gross domestic product of Africa by 3 to 10 per cent. The terms-of-trade
effects of the combined food and energy price increases are in excess of 10
per cent of GDP in more than 15 developing countries, where the room
for manoeuvre on the macroeconomic front is limited. With millions of
Africans living on the margin between subsistence and starvation, high
food and fuel prices may represent a threat to their survival and further
heighten energy poverty (UNIDO, 2007). At the same time, poverty and
high fuel prices can cause people to engage in high profile deforestation
which might in turn exacerbate climate change.
It is important to point out the international justice implication of the
above. Historically and currently, Africa’s contribution to climate change
is very low compared to other world regions (IPCC, 2007). This implies
that the changing climate in Africa and associated energy poverty conse-
quences is very much an issue of global justice and equity (Okereke and
Schroeder, 2009; Okereke, 2010). Emissions of carbon dioxide in Africa
represent only a small fraction (3.6 per cent) of the total CO2 emissions per
year worldwide. In sharp contrast, the contributions from Europe, Latin
America and the US are 14 per cent, 20 per cent and 14 per cent respec-
tively. Looking forward, Höhne and Blok (2005) calculate that by 2050 the
OECD will be responsible for about 41.7 per cent of global average surface
temperature increase due to fossil CO2 while Africa and Latin America
combined would be responsible for just 17.05 per cent. So both in present
and future terms, it is the African poor without access to modern energies
and who have not shared in the benefits of wealth created from the inten-
sive use of energy in the last century that will be the most affected by the
impacts of climate change due to greenhouse gas emissions.
In any case, it is clear from the above discussion that nearly all policy
measures adopted in order to pursue GHG emission reductions will have
implications for the developing countries’ economies in general and energy

provisioning in particular. Specifically, investments aimed at reducing

GHG emissions in Africa may result in reduced expenditure or invest-
ments in the energy sector of various African economies (UNEP, 2012).
As stated, an urgent challenge for Africa in the light of climate change is
how to achieve growth in the context of growing international mitigation
policies and the impact these are having on their economies. While this
challenge may appear overwhelming at first, there are indications that
Africa could turn climate change into opportunities by pursuing climate
resilient low carbon growth strategies. Such strategies will not only enable
the continent to manage the development risks associated with global
climate mitigation efforts, it will also help them to build a diversified and
energy secure and robust local national economies.
4 LOW CARBON DEVELOPMENT IN AFRICA
Low carbon development has recently gained currency in academic and

policy circles. Although fuzzy and poorly defined, the concept has nev-
ertheless captured public imagination as a possible means of reconciling
the need for economic development and climate mitigation. Low carbon
development is an imperative for all countries, developed and developing
alike, if the global aspiration to combat climate change is to be achieved.
Yet, it is widely recognized that the concept has a particular relevance to
developing and fast emerging countries where wide scale development
initiatives are either needed or already taking place (UNEP, 2012). A car-
dinal feature of the low development paradigm is the notion of decoupling
economic growth from carbon emission (Mulugetta and Urban, 2010).
In practice, this entails embracing low carbon designs, structures and
industrial activities as central parts of development plans. It also requires
technological intervention to enhance the energy efficiency of key sectors,
implements and practices (Bowen and Frankhauser, 2011).
Given the abundance of renewable energy sources in Africa, it has
been suggested that the effort needed to shift production towards cleaner
sources may be less than can be expected in some other world regions
(Abanda et al., 2012). Africa has significant hydro power potential which
is thought to be in the region of 40,000MW (Kalitsi, 2003; Diog and
Adow, 2011). The Democratic Republic of Congo (DRC) and Ethiopia
together account for more than 60 per cent of Africa’s hydropower poten-
tial. Currently, though, only about 20 per cent of this energy source is
being utilized. Africa has an abundant reserve of natural gas mostly con-
centrated in Algeria, Egypt, Libya and Nigeria. The BP statistical Review
(BP 2012) estimates that total proven reserve in Africa is 513.2 trillion

cubic feet which amounts to about 7 per cent of total world reserve. Only
a fraction of this is currently being utilized and a vast portion especially in
Nigeria is being flared. It is in fact estimated that gas flaring accounts for
about 12 per cent of Nigerian’s annual greenhouse gas emission (Anozie
et al., 2007).
Estimated geothermal resources on the African continent are around
14GW (EIA, 2011). Of this, only 0.6 per cent has been exploited. Currently,
the only countries using geothermal for electricity in Sub-Saharan Africa
are Kenya (127MW) and Ethiopia (7MW) (Diog and Adow, 2011). It is
thought that some of the most promising undeveloped rift systems are
the East African Rift in Mozambique, and in Uganda. Further research
is required to explore possible geothermal potentials in Tanzania, Eritrea
and Zambia (Sokona et al., 2012). In 2007, Africa had about 476MW of
installed wind energy generating capacity; a significantly low proportion
of the estimated Sub-Saharan Africa-wide capacity (93,000MW) (Okoro
and Chikuni, 2007). Countries like Djibouti, Eritrea, Mauritania and
Madagascar among others experience strong wind speed which can be
readily converted into useful energy. The Sub-Saharan African countries
are well exposed to sunlight with some of the highest solar intensities in the
world (Wolde-Rufael, 2009). Northern and southern Africa, particularly
the Sahara and Kalahari deserts, have particularly promising conditions
for concentrated solar plants for large-scale power production. Kenya has
made good strides towards the utilization of solar with more than 30,000
very small solar panels, each producing 12 to 30 watts sold annually. It is
the world leader in the number of solar power systems installed per capita
(Abanda et al., 2012). However, to date, only South Africa is generating
appreciable solar thermal power (0.5MW) in the Sub-Saharan region.
Africa has vast land mass which can be farmed to produce biofuel in a
sustainable manner (Akinbami et al., 2001; Amigun et al., 2011) Countries
with suitable land include South Africa Angola, Zambia and Mozambique
among others.
In general, with adequate economic, technological and governance
infrastructure a vast portion of African energy could be produced from
clean and low carbon sources. This of course is not to suggest that the
exploitation of fossil fuel will have to be completely abandoned. Nor is it
the case that all the energy sources mentioned above do not have social
and environmental impacts. It is general knowledge that in most cases,
achieving energy security requires that countries strive to maintain a
balanced mix of energy sources in their portfolio (Sokona et al., 2012).
On the consumption side, low carbon development would require sig-
nificant changes in values especially with respect to consumption behav-
iour and patterns. For Africa then, the goals of low carbon development

should be to: (a) achieve energy security by significantly enhancing access

and reducing reliance on imported fuels; (b) contribute to tackling climate
change by avoiding high profile emission in the path to economic devel-
opment; (c) achieve diversified, equitable and climate resilient economic
growth; and (e) realize effective climate adaptation. It is apparent that
achieving low carbon development would have far reaching implications
for governance and institutional design. For example the internalization
of environmental costs of growth would require appropriate pricing of
goods and services through a range of policy and economic measures tar-
geting both the production and consumption sides. These would include
national and sub national strategies, and master plans, targets, taxes, sub-
sidies, infrastructure and public awareness campaigns.
5 BENEFIT OF LOW CARBON DEVELOPMENT FOR

AFRICA
The concept and practice of low carbon development in Africa implicate

a number of opportunities and threats. Some of these will resonate with
other developing countries and some will be specific to Africa with its
unique set of resource-base, technical capacity, financial situation. One
threat of low carbon development to Africa would be if the approach
impedes economic growth by requiring African countries to bear a dis-
proportionate financial burden relative to business as usual development
approach (discussed further below). Another would be if commitment to
low carbon development results in unnecessary intrusion into the domestic
policy processes by foreign actors. That said, there are evidently several
reasons while it is in the interest of African governments to embrace and
pursue low carbon development. Below, we sketch some of the pertinent
benefits of low carbon development for Africa. In doing so, we bear in
mind that Africa is a very diverse continent and that a number of points
discussed here may not be equally applicable to all the countries within the
continent.
The first obvious potential benefit of low carbon development is that
the approach provides an opportunity for African countries to build more
resilient and diversified economies. Many African countries can make
their economies more resilient by moving away from conventional single
source energy generation towards a more diversified energy portfolio.
Countries that get their energy from a mix of sources would naturally be
far less vulnerable than those that rely on single sources. Specifically, low
carbon development has the potential to help African countries reduce
the economic vulnerability associated with dependence on oil (Okereke

and Tyldesley, 2011). Almost one-third of African countries (15) are land-
locked with no access to the ocean or seas. Many of these are oil import-
ing countries with no proven oil reserve. Examples of such landlocked
countries include Botswana, Burkina Faso, Burundi, Central African
Republic, Chad, Ethiopia, Malawi, Mali, Niger, Rwanda and Uganda. In
the absence of directly accessible oceans and seas, these countries trans-
port crude and refined oil by road over very long distances. Oil is not only
an expensive commodity, but one that is uniquely prone to dramatic price
spikes. The dependence of these countries on imported diesel and heavy
fuel oil means that their economies are very vulnerable to highly fluctuat-
ing oil prices. Furthermore, it also implies that the country’s electricity
generation is firmly tied to insecure oil sources. Oil price spikes directly
affect GDP, and in oil-dependent countries the effect can be quite high.
On average, it is estimated that every 10 per cent increase in the oil price
results in a global drop in GDP of around 0.2 per cent (Owen et al., 2010).
This figure is much higher for many African oil importing countries.
Economic resilience and security can also be enhanced through a range
of other sectoral measures and policies widely associated with the concept
of green growth such as low carbon development cities and transport.
In urban design, for example, countries that opt for dense and compact
cities with ample allowances for buses and cycle routes are likely to have
both economic and social advantages over those that favour extensive
sprawls with very little and expensive integration. Low carbon houses can
save energy and help reduce demand on national grid. The main source
through which African countries contribute to climate change is currently
through land use and deforestation (IPCC, 2007a). Low carbon develop-
ment would have to incorporate effective forestry and land use manage-
ment (Bowen and Frankhauser, 2011). This should help to protect the
natural environment and reduce the vulnerability to flash flooding and
destruction caused by wide fire.
Shifting away from inefficient biomass energy to modern sources
would also help eradicate poverty and increase economic growth and
development. Cleaner energy sources can enhance the adaptive capacity
of households to climate change with several important co-benefits. For
example using clean cooking stoves and solar lighting will reduced the
need to walk large distances to collect firewood. Accordingly, women and
children who are usually responsible for these tasks will have more time in
the day to engage in productive activities such as trading, household duties
or educational activities. Increasing the amount of time for such tasks can
support gender equality in the home, and the wider socio-economic ben-
efits associated with empowering marginalized groups such as improved
access to community decision-making processes (Diog and Adow, 2011).

Renewable energy can be particularly suitable for rural and remote areas
where, transmission and distribution of energy generated from fossil fuels
can be difficult and expensive. Producing renewable energy locally can
offer a viable alternative. In such situations, renewable energy can also
contribute to education, by providing electricity to schools.
In addition to reducing wider economic vulnerability related to oil
price fluctuations, the purist of low carbon development can specifically
increase African countries’ energy security. Many African countries cur-
rently depend on very high cost imported electricity to meet their power
needs (World Bank, 2011). Paradoxically, in most cases these countries
have abundant renewable sources that could easily be harnessed to meet
internal energy demands. In fact with good planning and targeted invest-
ment, these countries could eventually be net energy exporters. However,
current reliance on externally sourced energy not only implies that scare
financial resources are spent on the importation of electricity; it also
results in huge insecurity in energy supply. Energy insecurity is further
exacerbated by the fact that supplies in some cases come from countries
and regions that are politically unstable. Currently, Morocco is the largest
energy importer in northern Africa. Morocco produces small volumes of
oil and natural gas from the Essaouira Basin and small amounts of natural
gas from the Gharb Basin (UNIDO, 2007). However, over 90 per cent of
its energy resources come from external sources. Much of these imports
are transcontinental from Spain via cables laid beneath the sea and across
the Strait of Gibraltar. It is estimated that the country’s total yearly costs
for energy imports range from USD1 to 1.5 billion. With the increase in
oil prices in 2005 the cost of import rose to approximately USD2 billion
resulting in a huge budget deficit for the country (UNEP, 2012).
Another high energy importing county is Togo which imports as much
as 80 per cent of its electricity. Out of a total consumption of 726 GWh
in 2006, Togo imported 505 GWh mainly from Ghana with additional
imports coming from Nigeria and Ivory Coast. Zimbabwe imports up to
400MW of electricity from neighbouring countries including Zambia and
the Democratic Republic of Congo. In 2008 the country experienced wide
power cuts because an accumulated debt of about USD100 million pre-
vented it from importing larger amounts of electricity. Similarly, also in
2008 Botswana and Namibia, both of which imports over 50 per cent of its
electricity from South Africa, were hard hit when an internal energy crisis
in South Africa forced Eskom to ration its internal supplies and drastically
reduce the amount exported to neighbouring countries. Drained by five
principal rivers including the Zambezi, Mozambique is richly endowed
with considerable hydropower potential. This has been estimated at 12,500
MW, with a corresponding annual energy generation potential of 60,000

Gwh per year. However, so little of these resources have been exploited.
Hence, up to 70 per cent of the country still depends on inefficient and
unsustainable biomass sources for energy (World Energy Outlook, 2012).
In general, energy sources such as river basins in Africa are under-utilized,
with only 20 per cent of the total potential of hydropower plants under use
(Kalitsi, 2003; World Bank, 2011). Mozambique, Lesotho and Swaziland,
all of which have abundant renewable resources, continue to rely on South
African Eskom for significant amount of their energy needs. Other heavy
electricity importing African countries include Egypt, Niger, Namibia,
Tanzania and the Republic of Benin.
It has to be acknowledged that there are instances when it is cheaper for
a country to import rather than produce its own electricity. Furthermore,
some have argued that regional power ‘pooling’ schemes provide the
benefit of scale and as such could help solve African’s energy challenges
(Khennas, 2012). However, cheap importation and power pooling should
not be seen as substitutes for developing in-country energy sources, espe-
cially when this can be done from abundant renewable and sustainable
sources. Currently though, far too many African countries are either
importing from very insecure sources or relying on thermally generated
electricity to meet their energy needs.
However, the high price of oil means that electricity generated using
oil-based generators is very costly and must be subsidized by the govern-
ment in order to make it accessible to consumers. Even so, many African
countries still pay exorbitant prices for their electricity. This is unsustain-
able especially in the context of very limited resources, high budget deficit
and spiralling external debt. The purist of low carbon development, if well
planned, could help lower the cost of energy in many African countries.
On 1 July 2008 Namibia and Botswana increased their electricity tariffs
by 18.6 per cent and 20.4 per cent respectively and warned that prices will
continue to rise. These increases had to do with the need to offset the high
cost of electricity importation from South Africa. In 2005 the government
of Rwanda spent around 8.4 billion RwF (USD13,356,000) on fuel for
electricity generation which produced 55.2 GWh. This is in comparison to
1.5 billion RwF (USD2,385,000) spent on 86 GWh of imported electricity
from regional hydropower stations. At the same time electricity prices in
Rwanda rose from 82 RWF (USD0.13) in 2005 to 112 RWF (USD1.78) in
2006 as the government struggled to cover the high cost of thermal genera-
tion and importation (MINIFRA GoR, 2008).
A further incentive to move away from a fossil fuel-based economy is
the effect that the high level of imports has upon African countries’ trade
deficit. Many African countries that have huge budget deficits spend
large amounts of their foreign exchange on oil importation. The current

situation, where the import of oil-based fuel for electricity generation

and transport continually saps scarce foreign reserves, is not sustainable
for long-term economic development. It has been suggested that in 2008
Ethiopia spent up to 96 per cent of foreign earnings on oil import. With
the extraordinary rise in oil prices within this period, it is no wonder that
inflation soared to as high as 39.4 per cent. Given the very low purchasing
power of the African population, high electricity costs are far from ideal.
In addition, high electricity costs discourage industries and businesses
wishing to set up in the continent. Utilizing domestic renewable energy
resources would allow cheaper electricity generation which would enable
greater electricity access.
Lastly, low carbon development will help Africa to prevent what is
commonly known as carbon lock-in. Carbon lock-in refers to a situation
where a high carbon infrastructure in a country inhibits drive and options
to pursue alternative energy sources. Many African countries are cur-
rently investing or making serious plans to commit large sums of money
to develop their energy infrastructure. With the rapid economic growth
experienced in the last 10 years massive investments are also being made
or planned in other development infrastructure such as roads, railways,
airports, and cities. In general, these infrastructures have an average life
span of about 40 years and buildings can last much longer than this. The
implication is that decisions made today about the types of power plants,
roads, railways and buildings funded or constructed will have carbon and
energy implications for up to 40 or 50 years at least from now. In other
words countries can be ‘locked-in’ to a high carbon or energy pathway
by making wrong or short-sighted decisions on which development plans
they adopt. By thinking through future energy and carbon implications of
decisions and adopting low carbon alternatives, African countries could
avoid high carbon lock-in while continuing to develop in a sustainable
fashion.
The World Bank and OECD estimates that a total of USD40.8 billion
a year in investments is needed for Africa’s power sector, with USD26.72
billion for capital expenditure and USD14.08 billion for operations
and maintenance (World Bank, 2009). For the IEA Africa needs about
USD344 billion to create additional electricity capacity, upgrade installed
equipment and extend transmission and distribution networks to house-
holds and factories. Countries that are already spending large sums of
monies in their energy sectors include South Africa, Nigeria, Botswana,
and Namibia among others.
The government of South Africa estimates that just keeping up with
growing demand from industries and the population will require doubling
its generating capacity by 2025 at a cost of USD171 billion. Of this, the

government plans to spend up to USD45 billion by 2013. Between 2000

and 2007 the Nigerian government under President Olusegun Obasanjo
spent about USD16 billion to revamp its power sector. With precious little
achieved, the present government has recently pledged to spend USD5.7
billion over the next four years on the power sector. Botswana is spend-
ing USD28 billion to construct an integrated coal mine and power station
in Mmamabula that could generate 4,800 megawatts (MW) for about 40
years. Zambia is estimated to need USD billion to raise power output to
meet its expanding demand and Rwanda has pledged to invest up to USD
4.74 billion in its energy sector between now and 2017.
A quick look at energy development strategy of many African countries
however indicates that for the most part these countries are investing or
planning to invest their money on conventional hydrocarbon-based gen-
erating facilities rather than on cutting edge low carbon technologies. This
is, in a sense, very understandable as these countries are concerned about
the high cost of low carbon technologies especially given the difficulty of
raising finance from the public and private sector. Perhaps the most recent
high-profile example is the 4,800MW Medupi coal-fired power plant
that is being constructed by the South African government with financial
assistance from the World Bank. When the plans by the South African
government to borrow about USD3.75 billion came to light, many green
NGOs argued that the money should have been better spent towards gen-
erating from renewable sources such as wind and solar. However, South
Africa argued that investing in renewable sources will cost much more and
generate far less electricity than a coal power plant. Given the urgent need
to increase supply to support rising demand and economic growth, the
country felt it had little option than to commit to building the high carbon
power plant.
6 CHALLENGES TO LOW CARBON

DEVELOPMENT AND ENERGY SECURITY IN
AFRICA
Achieving low carbon development and energy security in Africa will not
be easy. The pursuit of low carbon growth poses a challenge for countries
all over the world and there are reasons to believe that these challenges
may be particularly acute for African countries. One of the most obvious
and frequently cited obstacles that may hinder Africa from harnessing the
advantages of green growth is lack of finance. Although technological
advances that help lower their costs are being made, clean energy in most
cases still costs far more than its conventional alternatives. For example,

figures from the 2012 report of the Energy Information Administration

(EIA) of the US Department of Energy (DOE) suggest that the average
capital cost of energy from conventional coal, solar thermal and off-
shore wind are USD65.8 million MW/h, USD204.7 million MW/h and
USD300.6 million MW/h. Even when one factors in the operation and
maintenance, fuel costs and transmission investment, all of which are in
most cases lower for clean energy, the average total system costs of renew-
able technologies are still mostly higher than the conventional sources.
Generating from renewable sources may also have benefits such as those
related to health. However, their costs remain mostly ‘front-loaded rela-
tive to their benefits’ (Bowen and Frankhauser, 2011, 149).
There are of course a number of renewable options such as low head
hydro and biomass that are economically competitive especially as a
means of supply to sparsely populated rural communities, but even these
may require technical assistance and the correction of market failures
which may be difficult for many African countries to deliver. Moreover,
even when there are strong long-term economic and environmental
arguments for investing in clean energy, the notion might persist that in
taking a low carbon route, Africans are paying a price imposed on them
by foreign governments whose main interest is global climate mitiga-
tion. These are some of the main reasons why the provision of adequate
and predictable finance and technical assistance by developed countries
is absolutely essential in encouraging African countries to embrace low
carbon growth paths.
Unfortunately, it is well known that current financial and technical
support from the developed countries is far too low compared to what is
needed. The Global Environmental Facility established in 1991 serves as
the main operating entity for the international climate regime and has the
longest track record on environmental funding. However, it received just
over USD1 billion during its fourth replenishment period (2006–2010).
Similarly the other two funding sources within the convention, the Least
Developed Countries Fund (LDCF) and the Special Climate Change
Fund (SCCF) (both also administered by GEF), have only disbursed
USD108 million and USD80 million respectively since their inception in
2002 (Sokona et al., 2012). These figures represent a tiny fraction of what
is needed to help developing countries adequately invest in low carbon
development and energy security. To compound matters, African coun-
tries, mainly because of poor capacity and their position in the global eco-
nomic structure, have not been the favourites in attracting multilateral and
private sector climate finance. Fast-start finance agreed at Copenhagen in
2010 was just USD10 billion per year up until the end of this year; with a
long-term goal of mobilizing USD100 billion per year by 2020. And while

this may not be enough, it is doubtful that the global North will commit
the amount of money required to meet this ambition.
In addition to the general lack of climate funding, there is also an
indication that availability of finance is not linked to what is actually
needed or to where it is most urgently needed (Diog and Adow, 2011).
Rather, climate finance delivered has reflected the political preferences of
developed countries, and the ‘low-hanging fruits’ opportunities offered
by the higher emitting, middle income countries, particularly India and
China (Diog and Adow, 2011). It is therefore imperative that adequate
and predictable funding is available in order to incentivize low carbon
development in Africa. A good illustration of the problem of lack of
finance can be found in Rwanda. The Government of Rwanda has ambi-
tious plans to develop its energy sector as a wider plan for achieving low
carbon and climate resilient development. Up to 90 per cent of Rwandans
have no access to electricity. Of the 20 per cent living in urban areas only
about 25 per cent are connected to the national grid. And at about 44
kWh per capita per year Rwandan electricity consumption per capita is
among the lowest in the world. The Energy Sector National Policy and
Strategy set out the aim of installing a total of 1,000MW electricity gen-
eration capacity by 2017 (up from 85MW at present). This expansion of
electricity generation capacity is planned to come from four main sources;
geothermal (310MW), hydropower (300MW), methane (300MW) and
peat (100MW). It is planned that a rapid national grid expansion pro-
gramme will accompany this increase in generation capacity. The grid will
be extended by 2,100 km (700 km of HV and 1,400 of MV), increasing
the number of connections to 1,200,000 up from 175,000 today (Safari,
2010). The aim of this extension is to enable 50 per cent of the population
access to the national grid by 2017. In addition, by 2017 the GoR plans to
ensure that all health centres, local administration offices and all schools
in the country have access to electricity, either off or on grid (Eggoh et al.,
2011). The increase in access to electricity is intended to provide alterna-
tives to traditional sources of energy, hopefully reducing the dependence
upon biomass and limiting risks of deforestation. The target is to reduce
the use of biomass from 86 per cent of primary energy use today to 65
per cent in 2017. This will also be accompanied by efficiency measures
such as improved cooking stoves. Alternatives such as biogas will also be
introduced.
The big challenge however is that the energy generation and access
plan is estimated to cost around USD5 billion. To put this in context, the
entire budget for Rwanda including both recurrent and domestic spend-
ing for the fiscal year 2009/10 was USD1 billion. And of this figure, donor
support accounted for about 41 per cent. One can immediately see the

difficulty faced by the country in overcoming the problem of energy access

which is fundamental to economic growth.
While lack of international climate finance is a major factor limiting low
carbon energy secure future for Africa, it is important to stress that this is
only one side of the coin. The other is widespread lack of technical capac-
ity and good governance in Africa. There is an abject paucity of technical
skills needed to design and implement conventional development projects,
let alone cutting edge low emission growth plans (Okereke and Tyldesley,
2011). The majority of African countries have critical capacity gaps in
all the key phases involved in the low carbon development delivery chain
from conception, through design and planning to implementation. Many
governmental ministries have just one or two experts who have to draft
or vet project proposals, study sophisticated engineering designs, conduct
rigorous economic analysis, negotiate complex legal contracts and under-
take the other several highly technical tasks associated with policy devel-
opment and implementation.
Closely related to, and perhaps the primary reason for poverty, is the
problem of poor governance. Decades of poor governance in Africa have
resulted in underinvestment in education, human capital, and research
and technology development. Similarly, there is widespread underinvest-
ment in fundamental development infrastructure upon which to leverage
green growth policies. Lack of infrastructure, poor institutions and wide-
spread corruption provide the platform for the dominance of the energy
market by monopolies which are often controlled by a few elites. These
monopolies are usually not interested in widening energy access but have
been known to actively block the market entry of green energy providers.
The result is lack of private capital, pervasive market failure, chaotic regu-
latory environment and usually high costs for investment in clean energy.
To achieve energy security and low carbon development, then, African
countries will need to undergo radical governance reforms aimed inter
alia at minimizing corruption, increasing technical and human capacity,
correcting market failure and boosting investment in infrastructure and
technology development.
7 CONCLUSION
The concept of low carbon development offers plenty of prospects for

Africa to grow its economy, achieve energy security while contributing
its own quota in the global effort to fight climate change. Given the criti-
cal importance of modern energy to wellbeing and to economic devel-
opment in general, achieving universal energy access should definitely

be the priority of African countries. However, there is no reason why

Africa must follow the development path towed by the West with its
negative impact on environment and humankind. Rather, emphasis
should be on harnessing the abundant renewable natural resources
present all across the continent. However achieving low carbon devel-
opment would require the massive upscale of climate and clean energy
finance, large-scale investment in technology and human capacity as
well as radical governance reforms. Africa has the right to expect sig-
nificant financial assistance from the international community to offset
the additional cost associated with low carbon development. It currently
makes an insignificant contribution to the global carbon pool while
bearing the brunt of much of the negative impact of climate change.
Indeed, the World Bank (2010) calculates that scaling up access to
electricity access in Africa would add only a small fraction of projected
global emissions from 1.5 per cent of global annual energy related CO2
emissions today to 2–3 per cent of global emissions by 2050. Provisions
of much needed basic energy services to the poor would therefore con-
tribute only 1 per cent to global CO2 emissions (World Bank, 2011).
The poor deserves basic energy services like everyone else. Moreover,
they have made little contribution to climate change. Global justice
and equity is therefore at the heart of the debate about climate change,
energy security and climate mitigation.
NOTE
* Chukwumerije Okereke wishes to acknowledge research funding from The Leverhulme

Trust, Grant Reference ECF/7/SRF/2010/0624.
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22. The road not taken, round II:
centralized vs. distributed energy
strategies and human security
Ronnie D. Lipschutz and Dustin Mulvaney
INTRODUCTION
Thirty-five years ago, in the midst of the energy crisis of the 1970s, Amory
Lovins published an article in Foreign Affairs warning against the United
States’ plans to increase its reliance on nuclear power as a path toward
reducing dependence on imported oil (Lovins 1976). Not only would a
large nuclear program – an order of magnitude more nuclear plants are
in operation in the U.S. today – raise significant safety and security risks,
argued Lovins, preventing the theft of weapons grade nuclear materials
would require a highly-centralized and authoritarian infrastructure, with
corrosive effects on American democracy and individual freedom (see
also Ayres 1975). A decade later, Langdon Winner (1986) echoed these
sentiments and argued that technological artifacts such as nuclear reac-
tors have important implications for social order because of their entan-
glements with questions of nuclear weapons proliferation. Both Lovins
and Winner were essentially arguing that socio-technical systems, such
as those that make possible electrification of human society, have social
tendencies independent of human intention, and that differing technologi-
cal paths would have different kinds of social impacts and, by extension,
effects on human well-being and security.
Lovins also argued that, by contrast, solar energy technologies did not
rely on either risky or far-away energy sources and were more amenable
to decentralized modes of energy procurement and generation. These
features, he claimed, would promote energy autonomy, democratization
and even reduce the political and economic power of electric utilities
and energy corporations. Solar energy is freely available to anyone able
to capture it on site, making it suitable for decentralized, small-scale,
distributed power generation (DG).1 Photovoltaic (PV) technologies, in
particular, enable people to electrify homes and businesses with limited
reliance on or even no connection to the electricity distribution grid, fos-
tering a sense of energy autonomy and freedom, and enhancing well-being
and security. Already in the early 1970s, The Whole Earth Catalogue
483

(http://www.wholeearth.com/index.php, accessed February 22, 2013),

Stuart Brand’s counterculture publication offering “designs for living,”
included plans and advertisements promising PV systems that could
increase the energy self-reliance of communities and individuals (Turner
2006), and the country as a whole.
In the intervening decades, solar energy and PVs have become
well-developed and mature technologies, proving cost-effective in a wide
range of settings yet largely failing to fulfill the promises made by Lovins,
Whole Earth and many others. Even today, as the cost of rooftop PV systems
has enabled numerous middle-class consumers and companies to solarize
their homes and businesses (Cardwell 2012), distributed generation (DG)
still provides only a small fraction of the country’s electricity needs. As far
as reducing fossil fuel dependence, renewables have, so far, proved unable
to substitute for much oil, which is not much used in the power sector but
dominates in transportation (a shortcoming shared with nuclear power).
Nuclear power is unlikely ever to achieve the lofty goals set in the 1970s, while
coal and natural gas, two of the world’s mainstays for generating electricity,
remain remarkably cheap. Most of the world has found it economically and
politically difficult to shift away from fossil fuels even in light of growing risks
from climate change. What has gone wrong? Or, in the immortal words of
China’s Prime Minister, Chou En-Lai, when asked for his assessment of the
French Revolution, replied, “It is too soon to tell” (McGregor 2011). Perhaps
the solar revolution has not yet arrived, even if it is around the corner.
What is arguably different today are the rising risks and impacts of con-
tinued reliance on fossil fuels and nuclear energy, exacerbated by impend-
ing climate change. The Fukushima disaster of 2011 demonstrated not so
much the hazards of nuclear power as the enormous social and economic
vulnerabilities of heavy reliance on technologies that sometimes suffer
catastrophic failures. Numerous predictions that global fossil fuel con-
sumption will continue to increase during the coming decades, notwith-
standing the threats and risks of climate change, suggest that concerted
action to transform energy systems is unlikely to happen. Continued reli-
ance on an aging power distribution infrastructure, evident in large-scale
regional power blackouts, raise questions about greater concentration and
centralization of power generation strategies. Finally, repeated warnings
that cyberhackers, whether civilian or military, could gain control over or
disrupt the power sector, with catastrophic consequences for the country’s
infrastructure, should not be ignored. All of these shortcomings are of
concern where human welfare and well-being are concerned; the effects
of extended power outages and broken distribution systems become only
too evident in the aftermath of destructive hurricanes, tornadoes, floods,
tsunamis and even human error.

Centralized vs. distributed energy strategies and human security 485
None of this is to say that renewables are wholly safe and risk-free, or
could wholly eliminate threats to human security. A full life-cycle analysis
of various solar, wind and biofuel technologies reveals a host of associated
problems, such as land use change, toxic materials, damage from mining
of rare earth elements and other minerals, threats to species diversity and
even waste disposal issues. If deployed in a centralized fashion, renew-
able power is as vulnerable to regional blackouts as any other fuel source.
Vaclav Smil (2010) points out that renewables require more land due to
lower power densities, which means that extensive deployment will invite
more opportunities for land use conflicts with other species and communi-
ties. PV is ideal for DG and can be sited atop the human footprint, and
can fulfill many regions’ energy needs. A full tally of the ecological and
social costs of renewable energy sources indicates that they offer greater
benefits with fewer externalities than fossil and nuclear sources, especially
if climate change is taken into account. More to the point, and somewhat
reminiscent of Lovins’s arguments, if deployed in a distributed, decentral-
ized fashion, in the form of electricity micro-grids, there could well be a
number of positive and socially-beneficial consequences that would not
only reduce overall environmental costs but also enhance human security.
An important caveat: these effects would not result from any inherent
qualities of the technology but, rather, deliberate and intentional policy
and design.
In this chapter, we undertake a comparative assessment of the impacts
of centralized and decentralized energy sources and strategies, their inher-
ent and constructed political and social qualities, and the environmental,
health, safety and security implications of the two alternatives, especially
as they affect “human security.” In this instance, the term human security
refers primarily to societies’ and individuals’ health and well-being, rather
than national or military security. The two concepts are not mutually
exclusive, but the latter has been plumbed in great depth for at least 40
years, while the former has not. We begin the chapter with a brief dis-
cussion of “human security” and what is encompassed by the concept.
Although national security has been challenged as the basis for public
and foreign policy since the 1980s (e.g., Ullman 1983; Lipschutz 1995), as
we shall explain, the changing organization and structure of markets, in
particular, has driven a shift towards greater focus on individual security
in the context of broad practice.
We then turn to a discussion of the relative costs and benefits of cen-
tralized and decentralized energy strategies, with particular attention to
the vulnerability of large-scale power plants and grids. As we shall see,
while first order analyses focus on reliability, resilience and vulnerability,
it is also important to consider second order environmental and third

order life-cycle impacts. Such assessments are not quite as straightfor-

ward as they might seem, as illustrated by the parallel case of the mini-
aturization and decentralization of computing technologies, which have
highly-sophisticated, low-cost devices available to many of the world’s
people. But they have also resulted in complex and potentially vulnerable
networks as well as growing volumes of front-and back-end toxic wastes,
with concomitant health risks. By contrast, large, mainframe computers
and communication networks might not offer the freedom and creativ-
ity available from desktops, laptops and tablets, but they do concentrate
many of the risks and hazards associated with the latter.
In the third part of the chapter, we turn to a more detailed description
and inventory of centralized and decentralized renewable power production
(the risks and hazards of fossil and nuclear fuels are relatively well-known,
and we address them here only briefly). We also offer a few case studies of
both, in order to illustrate comparative costs and benefits, especially from
the human security perspective. To characterize the tensions and problems
arising from large-scale centralized energy production systems, we examine
the California desert, where several renewable energy projects have gener-
ated considerable controversy and opposition (Ivanpah solar, Genesis
solar, and Ocotillo wind). We contrast these with decentralized projects
and project proposals to integrate solar energy projects into the footprint
of existing human infrastructure. Note, however, that the latter are, for the
most part, conceptual and in the design phase, and so the full panoply of
potential issues has not been inventoried from actual experience.
In the concluding part of the chapter, we summarize some of the risks
and vulnerabilities to which both types of systems are subject, ranging from
economic and political to social and environmental, and suggest areas of
further research that could help to clarify the comparative costs and ben-
efits of the two strategies. We also return to the issue of human security,
and discuss how the two approaches might affect it. We should note that,
although there are good reasons to value the individual freedoms that
might result from less reliance on centralized power systems, most of the
world’s people lack the capital to access decentralized technologies, and
over 1.5 billion people live in energy poverty, having no access whatsoever
to electricity. The security benefits to the latter of any generating technol-
ogy would be substantial.
DEFINING HUMAN SECURITY
Although the concept of “human security” has only entered the politi-
cal lexicon over the past couple of decades, it is not a new idea. Human

security encompasses not only health, welfare, and well-being, but also
environmental and structural conditions that might affect social order
and diminish people’s quality of life. As such, people are “secure” when
the circumstances of their lives provide access to basic necessities, such
as food, water, energy, housing, healthcare, education, employment
and income as well as protection against depredations and oppression
by others, whether neighbors, governments or other countries. To this,
we might also add those freedoms, liberties and opportunities that offer
people at least the possibility of a full life and the right to decide how
they will be governed, and by whom (see, e.g., Sen 1999; Newman 2010).
By most accounts, there are as many as two billion people – and pos-
sibly more – who are not secure and lack one of these critical necessities
(Lipschutz and Romano, 2012).
In this chapter, our particular concerns are with the ways in which the
systems and mechanisms that provide energy – what might be called the
“energy assemblage” – can affect human security. We have enumerated
some of these effects above, but offer here a more detailed, albeit incom-
plete, list.
● Lack of adequate energy supplies, especially in intemper-

ate climates, can have a direct impact on individual and
community health; in those circumstances in which local fuel
materials are in decline or depleted, the very project of
accumulating them may have far-ranging social and environmen-
tal consequences.
● Situations in which supplies of potential energy are enclosed and
access restricted to people – as, for example, in the case of dams and
reservoirs – can result not only in water scarcity but also in denial of
access to food, land, and other basic needs.
● The high costs of liquid fuels, such as kerosene, drives people to rely
on wood, charcoal, dung and other biofuels, all of which can lead
to deforestation and have deleterious health effects, especially if
burned in poorly-ventilated spaces.
● The processes of extracting fossil fuels are very dirty and where
poorly-regulated, as in the Niger Delta of Nigeria or the mountains
of West Virginia, can undermine local living conditions and envi-
ronments, not to mention general health and well-being.
● The manufacture of semiconductor devices, including solar PV
cells, can expose both workers and environments to toxic materials
released into the factory environment, water sources, arable land
and the atmosphere, problems exacerbated with the rise in contract
manufacturing.

● The operation of large-scale power plants continues to contribute

to air pollution and, where coal is being burned, to large quantities
of coal fly ash, even though, in some parts of the world, these have
been greatly reduced over the past 60 years.
● While nuclear power plants have a fairly good operating and safety
record – with a few notable exceptions – the safe and effective dis-
posal of nuclear wastes, especially in the United States, has yet to be
successfully accomplished, and there is a great deal of uncertainty
about the long-term safety of storing spent nuclear fuel rods in
“swimming pools” at reactor sites.
● Energy distribution systems are subject to accidents that can have
deadly consequences, such as when oil and gasoline pipelines are
sabotaged, or improperly monitored, and explode with sometimes
considerable loss of life; high voltage transmission lines are much
safer, although there continue to be concerns about the effects of
exposure to them.
● Improper disposal of decommissioned energy systems and compo-
nents, such as batteries, PV semiconductors and nuclear plant parts,
can have both short- and long-term health effects, if not property
contained.
● Excessive reliance on fossil fuels increasingly appears to be driving
global climate change in highly-undesirable directions, which will
have a broad range of negative effects on human security.
The ways that the energy assemblage affects and undermines human
security are very unevenly distributed, leading to frequent and severe cases
of environmental injustice and racism. Those living in wealthy countries
tend to experience fewer of these inequalities, and they often have recourse
and income to respond to the majority of them. By contrast, the world’s
billions of poor people are much more vulnerable to the uncertainties of
energy supply, risks and hazards. This is not to argue that renewable DG
is, somehow, a panacea for the lack of security faced by those billions;
there are many other sources of insecurity facing them that energy cannot
address. From our perspective, a critical question for human security is
how to provision electricity. How will choices that affect the degree of
centralization versus decentralization shape the effectiveness of energy
delivery (volume, time, reliability) and cost (health, social, environmental
and economic)? As suggested above, a full understanding of the compara-
tive costs, risks, hazards and vulnerabilities of energy alternatives, and
their implications for human security, is far beyond our capacity or the
space available in this chapter, but we endeavor to address the question as
comprehensively as possible.

ROADS NOT YET TAKEN
Certain aspects of warnings issued by Lovins and others during the 1970s
remain salient today, and are being recapitulated in contemporary debates
around renewable energy, especially solar and wind. Lovins called for
soft energy paths with soft social impacts, arguing that they would reduce
inequality, social conflict, vulnerability, democracy, and freedom. New
discourses of clean energy focus primarily on climate change impacts,
sometimes at the expense of social impacts. Whereas, 40 years ago, it was
the “energy crisis” and nuclear safety that provided the context for analy-
sis and public policy, most of the emphasis on energy transitions today is
in the context of climate change and political instability, which has refig-
ured politicians’, scientists’ and engineers’ preferences in terms of the tech-
nological composition of future energy infrastructures. The new emphasis
on “low-carbon” or “clean,” rather than simply “renewable,” energy
sources has broadened the scope of energy scenarios on offer to include
natural gas and nuclear for their lower carbon emissions profiles. Indeed,
this emphasis has led even the coal industry to tout the benefits of “clean
coal” and warn darkly of growing reliance on natural gas from fracking.2
The transition to new sources of energy has also been framed in terms
of technological and distribution scales, on the assumption that meeting
the challenge of global climate change requires a planet-wide and rapid
response. The lack of progress in international climate change negotia-
tions has raised widespread doubt that such a global energy strategy will
ever be forthcoming. A further complication is that new energy tech-
nologies typically require 50 years to be fully integrated into supply and
demand systems, while electrical infrastructure operates on a 40-year
replacement cycle (one that has been lengthened for a growing number of
power plants). The potential for “tipping points” and catastrophic climate
change (Lenton et al. 2008) has underscored the importance of getting new
energy sources to scale as rapidly as possible, which has led most coun-
tries to focus on large-scale, centralized renewable energy projects with
short-term planning horizons and hastened approval processes. What
is not so clear is where the large volumes of capital required to finance
a new power infrastructure will come from, whether renewable or not.
The International Atomic Energy Agency (Birol 2004), for example, has
predicted a need, between 2001 and 2030, for about $350 billion per year
to meet global electricity demand. While the net cost of a wholly renew-
able electricity assemblage might be greater, the price of individual DG
projects would be far smaller than the $1–5 billion required for many large
power plants.3 Moreover, while larger projects may have lower levelized
costs of electricity, the question is prices for whom? Renewables may not

yet be able to compete in wholesale electricity markets delivered through

centralized systems, but DG is already at grid parity for many electricity
consumers who must buy electricity at retail rates (Denholm et al. 2009a).
To take advantage of this, however, still requires considerable upfront
capital.
What, then, does a DG system look like? The basic principle underly-
ing DG is that any particular location that experiences a sufficient inward
flow of solar or wind energy – complemented, perhaps, by heat pumps,
micro-hydro, solar hot water heaters and biogas generators – can provide
a significant fraction of that location’s electricity (and energy) needs. These
vary, of course, from basic cooking and light all the way to large-screen
TVs, pool heaters and electric cars – which is why it is easier to meet the
supply criteria in poor societies, where electricity demand is relatively
low. In wealthier communities, it is often less costly to reduce electricity
demand through efficiency and conservation than to install capacity to
meet peak usage. To date, the most common deployment of DG systems is
to supply a single house or building; it is more cost-effective and efficient
in the long-run to design and size DG for a group of consumers, whether
constituted by a neighborhood, a cluster of businesses or some other
configuration. Not only does this make available greater rooftop area for
PV panels, it also affords greater opportunities for internal load-leveling,
behavioral change and user involvement in system operation as well as
offering some flexibility during grid failures.
At the same time, however, renewable energy sources are intermittent.
The sun does not shine 24 hours a day nor does the wind blow at a con-
stant velocity. Sometimes, a DG system generates more than is demanded;
at other times, less. There are various ways to address this mismatch. At
the present time, most DG systems in the industrialized world are hooked
into regional power grids, which rely on them to effectively reduce power
demand. Critical to effective DG is energy storage, whether through bat-
teries, off peak hot water heating, fly-wheels, pumped-hydro storage, or
compressed air (Denholm et al. 2010). Load leveling, which redistrib-
utes tasks from high demand to low demand periods, can also reduce
storage and backup requirements. What remains to be seen is how DG
systems and larger utility grids will be integrated (Shirmohammadi 2010;
Delucchi and Jacobson 2011) as well as the role that consumers will play
in operating such systems (Fischer 2006).
While the technical capabilities to deliver decentralized or distributed
renewable generation continue to improve and, in some instances, are
more cost-effective than conventional sources, tensions with centralized
renewables and their operators are growing in prominence (Marnay and
Bailey 2004). For technical, financial and management reasons, electric

utilities, power generators and even governments prefer to pursue the tra-
ditional unidirectional model of power delivery: large mega-and giga-watt
generators with extensive and interconnected distribution grids ultimately
feeding electricity to end users. Where DG is being embraced by public
policy, popular imagination and a broad range of small-scale develop-
ment projects, investor-owned utilities in the United States are coming
to regard DG as highly-problematic, for several reasons. First, as a result
of deregulation, electric utilities are less and less involved in the business
of generation and more and more in purchasing power from independ-
ent companies operating large plants, on the theory that this introduces
competition to the power market. Assuming that they would provide their
surplus power to the grid, DG would simply multiply the number of small
independent generators with which a utility would have to deal, greatly
complicating both business and technical aspects of managing the system.
Second, a plethora of DG systems linked into a larger grid could intro-
duce load instabilities due to changing demand and excess power when
it might not be needed elsewhere. Third, and perhaps of greatest concern
to utilities, is their complaint that customers with PV systems expect to
be paid for the surplus power they put into the grid but not have to pay
for the capital and maintenance costs of transmission and the distribution
infrastructure.4
Resistance to DG is therefore considerable, and utilities appear to prefer
centralized renewable generation. Large organizations tend to develop
“standard operating procedures” tied into particular forms of technology
and experience; changing those practices impose significant transaction
costs and involve steep learning curves. It is much easier to keep doing
what one does reasonably well – although, as American auto companies
have learned, this can be a path to perdition – rather than adapting to new
technologies, rules and practices. This suggests that centralized systems
are subject to entrenchment, owing to the substantial periodic investments
required to maintain them. It also points to another reason that utilities
and power generators have shied away from DG.
As we noted earlier, centralized power generation is not without costs
and risks, including environmental and other impacts and implications for
human security and safety. Decentralized energy is not a panacea for all
risks and hazards, and there is no predetermined relation between technol-
ogy and democracy, as Langdon Winner (1986) has warned. But there are
good reasons to pay attention to the comparative risks and benefits of
energy system design, scale, and organization and their implications for
human security and well-being. Typically, such costs – which economists
call “externalities” – only become apparent after a great deal of time,
energy and money has been spent. For renewable DG, the short-term

on-site risks and hazards are a good deal smaller than for centralized
power plants, yet those will be much more widely-distributed. More
homeowners are liable to fall off their roofs than technicians off power
plant catwalks (but there will be fewer catastrophic accidents). The risks
and hazards experienced by the DG owners and operators are voluntarily
incurred rather than unilaterally imposed, as is the case with air pollut-
ants, fracking and nuclear power. On a life-cycle basis, the greatest risks
and hazards from renewable DG are to be found in materials mining
and processing, manufacturing and, ultimately, disposal (Fthenakis et
al. 2008). Unfortunately, externalities in renewable energy supply chains
tend to be “out of sight, out of mind,” and efforts to regulate them are still
quite limited (McDonald and Pearce 2010). Redistribution of the health
and safety impacts of electricity generation from the wealthy to the poor
is hardly a new practice, but that is no reason to continue it (SVTC 2009).
Where DG could well have its greatest impacts is in those parts of
the world now lacking reliable power supplies or any electricity at all.
It is estimated that close to 1.5 billion people lack access to electricity,
while many more are connected to power systems that operate only spo-
radically. Even small amounts of power – as little as 100 watts and one
kilowatt-hour/day – can make enormous differences in the well-being and
quality of life of the world’s poor, while a few kilowatt-hours daily can be
used to procure water, electrify maternity wards, and refrigerate vaccines.
Given the high capital costs of building new centralized power plants and
distribution systems, paying for the fuel and collecting tariffs from the
very poor, locally-deployed solar, wind and biogas systems, with ordinary
lead-acid batteries, can provide a very modest level of power at relatively
low upfront cost (Narula et al. 2012). DG can also reduce electricity theft
and the very real risks and health hazards that arise from stealing power
from the centralized grid.
THE COSTS AND BENEFITS OF LARGE-SCALE

CENTRALIZED RENEWABLES
To recap the essence of Amory Lovins’s argument, centralized energy

delivery and distribution systems pose a host of safety and political
problems that could be avoided through a transition to decentralized,
on-site renewable sources of energy. Lovins did not consider compara-
tive life-cycle issues, nor did he offer any more than a deductive argu-
ment regarding the relationship between decentralization and democracy.
Today there is increasing attention to the fragility of the global petroleum
system, the emergence of climate change as a political issue, the ever-rising

capital costs of centralized power plants, the water and carbon pollution
problems arising from extracting unconventional fossil fuels such as shale
and tar sands, and the complexity and vulnerability to disruptions of
critical data transmission networks.
At the same time, the costs of electricity from smaller-scale renewable
technologies continues to decline and their popularity continues to grow.
Major changes have taken place in the organization of power production
and distribution, especially as a result of deregulation and independent
generation, but repeated attempts to incentivize a large-scale transition
to DG have met with only limited success. Why? It might be useful to
compare the power and telecommunication sectors to see how the combi-
nation of technology, social innovation and cultivation of demand have
led to near-revolutionary changes. To be sure, the degree of miniaturi-
zation achieved through micro- and nanotechnology are, as yet, hardly
applicable to the power sector, especially given the low power densities of
renewable sources. However, there are useful parallels.
In the case of telecommunications, we see how the American state, in
particular, played a significant role in jumpstarting technological inno-
vation, through the defense sector. Not only was the early development
and demand for semiconductors funded and stimulated by government
demand, the Internet also was born out of a government-sponsored
project to develop a secure and invulnerable communication system and
to further rapid contacts among research scientists. The original micro-
electronics companies – Hewlett-Packard, IBM, Xerox and others now
forgotten – were government contractors before they were commercial
providers of technology. While they have not proven as agile in the
market as later startups – especially Apple – they did provide an impor-
tant organizational bridge between state and market demand. Ultimately,
the decreasing size and rising capacities of computers and other electronic
devices, stimulated further research and consumer demand, bringing the
devices into the reach of even the very poor. The growing availability of
various forms of narrow and broadband communication have stimulated
network growth and transmission speeds, again leading to further inno-
vation across a broad range of technologies and practices. This is not to
argue that the result has been wholly salutary; such complex systems lend
themselves to both productive and destructive activities (Noble 2011).
In the case of DG, if various PV and wind generators represent the
technology – both of which have grown out of initial developments in the
military sector – and national and transnational electricity grids represent
the network – albeit not quite so unitary as the Internet – it is the social
organization of electricity markets that have yet to undergo significant
transformation. The Internet was never run as a public utility, subject to

the kinds of government regulation that entails, and so it has not had to
throw off that institutional form.5 By contrast, deregulation in the power
sector has not sought to break up large utilities, whose commitments to
large-scale generation remain steadfast. On the Internet, anyone can hang
out a shingle and try to sell goods and services; so far, small-scale genera-
tors are not permitted to do so (how this might come about is a public
policy question we cannot as yet answer). We could imagine arrangements
in which DG plants were permitted to contract with other DG plants
nearby in some kind of power exchange, although this would require
cooperation of the owner-operator of the distribution system.
One result of this centralizing tendency in renewable generation is a
rush to stake out solar- and wind-intensive sites, with strong encourage-
ment and incentives from government. According to Dian Grueneich
(2012), 29 states, two territories and the District of Columbia have devel-
oped Renewable Portfolio Standards, while the DSIRE database (2012)6
indicates that every American state and several territories offer financial
incentives to renewables. The future for centralized renewables looks
bright, albeit with visible and growing smudges. As of mid-2012, across
the United States some 31.5 GW of solar (SEIA 2012) and 60 GW of
wind (AWEA 2012) generating capacity, with a footprint of some 8,350
square miles7 (Jacobson and Delucchi 2011) are in operation or in the
planning and construction stage. Already, a number of shortcomings and
problems are becoming evident, generating opposition and stoking what
some have called a “Green Civil War” (New York Times Editors, 2012).
Controversial large-scale solar energy and wind projects are impact-
ing sensitive ecological habitats and literally running over endangered
species as well as widespread public concerns (Solar Done Right 2012).
The imaginary of those who promote large-scale solar is best captured
by the “Solar Grand Plan,” whose supporters argue that public lands in
the desert southwest would be well suited for solar electricity generation
(Zweibel, et al. 2008). Indeed, the U.S government is setting aside tens of
millions of acres of public lands in the Southwest for such projects (Fears
2012), in the expectation that dispatchable solar and wind projects will be
developed by private firms to deliver electricity to utilities. What do such
projects look like, and what are their environmental and social impacts?
Here, we offer three cases.
Ivanpah Valley and BrightSource
The Ivanpah Valley is situated about 25 miles south of Las Vegas in the
California desert, just outside of the California-Nevada border town of
Primm, Nevada. The valley is vast and gently sloping, 30 miles across

from north of Primm to the headwaters of the New York Mountains

to the south. The valley’s higher elevation flatlands, such as near Cima,
California (population: 21), contain the densest population of Joshua
trees (Yucca brevifolia) in the world. Creosote (Larrea tridentate) chapar-
ral dominates the lower elevation flatlands such as those at the proposed
project site (a clonal colony of creosote nearby is considered by some to
be the oldest living organism on Earth). The Ivanpah solar project site
is adjacent to the Mojave National Reserve and known to desert ecolo-
gists as an important habitat for the threatened desert tortoise (Gopherus
agassizii) among several other important reptile, mammal, and plant
species.
BrightSource is a solar energy company whose founder, Arnold
Goldman, received the World Economic Forum’s Technology Pioneer
Award for his work on solar power tower technology. He was the designer
of 10 solar electricity generating systems (SEGS) built from 1984 to 1990 by
Luz Industries, called SEGS I through IX (only nine were built), that still
operate in the California desert today, providing over 350 MW of power.
As early as 2006, BrightSource filed a petition to acquire about 8,000 acres
of public lands in the Ivanpah Valley. Upon hearing of the project, most
local ecology and public lands groups opposed the project, yet a number of
national environmental groups endorsed the project because of its poten-
tial to mitigate GHGs from electricity generation. This became an impor-
tant proposal, as it pitted local groups against the national organizations.
For example, the desert chapter of the Sierra Club vehemently opposed
BrightSource’s Ivanpah project, while the national chapters chastised the
local groups for lacking a commitment to efforts to slow climate change.
While numerous ecological impacts were noted during the siting hear-
ings, the major impact identified was to the desert tortoise. The United
States spends more money protecting the desert tortoise than on the grizzly
bear, bald eagle, and gray wolf combined. The project would require the
company to obtain an incidental take permit, implying that the project will
harm up to a specified number of the threatened tortoises. To estimate the
number of take permits required to construct the facility, consultants ini-
tially surveyed the project and suggested that the project would impact 12
to 24 individual tortoises. Yet, when preparations for construction were ini-
tiated, more than 36 tortoises were discovered living on less than one-third
of the proposed project area, which triggered a re-consulation with permit-
ting agency (the US Fish and Wildlife Service) as stipulated in the permit.
By the time the entire project site had been cleared, more than 150 desert
tortoises had been found (BLM 2011), consistent with desert activists and
ecologists’ claims that the Ivanpah Valley should be designated as an Area

of Critical Environmental Concern, a designation that would offer greater

protection for this sub-population of desert tortoise.
To lessen the impacts on endangered species of this particular $2.2
billion dollar project, the company has spent over $56 million on various
mitigations (BrightSource Energy 2012). In this instance, a centralized
renewable system has experienced a double whammy: it has been made
economically vulnerable and rendered a population of desert tortoise
less resilient to the impacts of climate change. Scientists suggest that the
Mojave Desert will be impacted by climate change more than any place
south of the Arctic. For species to adapt, they may have to migrate in
response to changes in heat stress and precipitation. Large-scale projects
such as these not only pose physical threats to animals, they also present
obstacles to species migrations in the future. Some have argued that such
ecosystems must be sacrificed in the name of climate change mitigation.
Others contend that decentralized systems of energy procurement and
generation would obviate these impacts.
Genesis Solar Energy and Ford Dry Lake
In 2009 a subsidiary of Next Era Energy Resources proposed building a

solar energy trough system in the Colorado Desert, close to the Colorado
River boundary between Arizona and California. A number of issues
similar to those raised at Ivanpah appeared at this site, although the area
is also of significance from a cultural heritage perspective. Giant intaglios,
figures tens of meters across in so-called desert pavement – small pebbles
firmly settled atop desert soils – are found throughout the area. Native
Americans have occupied this region for thousands of years and it is
believed to have been an important area for settlement by the ancestors of
the Aztec, Mayan, and Incan civilizations, as humans migrated across the
Bering Strait and toward Central and South America. Native American
elders earlier warned that the solar plant was sited near a desert watering
hole along an ancient trail connecting the Colorado River to the Pacific
Ocean. Not long after construction began on this multi-billion dollar
plant, a Native American burial ground was found on the site. Native
American tribes justly claim that there was no prior consultation with
them on the site, a requirement for public lands through a special arrange-
ment with the U.S. government.
The project has also had critical ecological impacts on an undistributed
desert ecosystem, the site of several resident Mojave kit fox populations,
another threated species and the smallest canine in the world. To comply
with the rules established prior to construction, the developer was required
to evict the kit foxes, which they did by spraying coyote urine into their

dens. Shortly after construction commenced, however, seven dead foxes

were found on the site, killed by distemper, a disease previously never
detected in the kit fox population (Sahagun 2012). Presumably, the
attempt to drive away the animals played a role in their contracting the
disease.
Centralized power systems are also vulnerable to localized weather
events (so are DG systems, but the effects on total generating capacity is
likely to be much less). Although deserts are dry by definition, they are
also subject to flash flooding. Activists had warned argued that siting the
project in a desert alluvial fan would make it vulnerable to flooding. In
July 2012, a flash flood did several million dollars worth of damage to the
project site.
Ocotillo Express Wind Energy Project
Large-scale wind farms already have a significant presence in the

California Desert, especially near the San Gorgonio and Tehachapi
passes that link the northern and southern parts of the state. The Ocotillo
Express project is a wind farm south of Palm Springs, California, in
close proximity to the Coyote Mountains Wilderness Area, the Jacumba
Mountains Wilderness Area, and Anza Borrego State Park. Pattern
Energy proposed to raise 112 wind turbines across 10,000 acres of
undisturbed desert ecosystem, connected to the Sunrise PowerLink, a
recently-approved and controversial high-voltage transmission line that
will carry energy over the 117 miles from the Colorado Desert to met-
ropolitan San Diego. Sunrise Powerlink has been justified as providing
San Diego access to the abundant renewable energy resources around the
Imperial Valley region of California.
Wind farm footprints differ from those of solar plants, as turbine
spacing allows for multiple uses include ranching, farming, and open space
conservation. A major ecological consideration, however, is that turbine
blades often strike birds and leave a pressure wave in their wake causing
significant mortality in bats, of which 12 species are found in the area.
The Ocotillo Express region is home to golden eagles and other raptors
such as burrowing owls. Because wind turbines are known to pose par-
ticular hazards to golden eagles, the developer must obtain an incidental
take permit for “taking” (killing) a number of the birds over the life of
the project. Under federal law, it is illegal to intentionally kill eagles (or
even possess eagle feathers and parts), and recent legislation prohibits the
Fish and Wildlife Service from issuing taking permits for eagles. Several
California desert tribes, including the Quechan, Kumeyaay and Cocopah
Nations oppose the project because the landscape is a sacred part of their

cultural heritage and close to a recently-discovered prehistoric cremation

site (which has subsequently been withdrawn from the project area).
All three projects were specially designated as “fast-track” projects for
their potential to quickly add renewable energy to the grid. As various
ecological and cultural resource conflicts gain legal and political traction,
however, it is less evident that such efforts are the most expeditious way
to deploy renewables. Activists argue that the wind resources to make
the project financially viable are actually not available, since the turbines
would be sited on the leeward side of the coast range (developers have sup-
plied data to the contrary). Unlike solar power plants, there is less flexibil-
ity in siting wind farms. Ridge tops are windiest but also most visible, so
that wind farms tend to be particularly controversial on aesthetic grounds.
Distributed alternatives for wind power are fewer but research suggests
that larger wind farms with multiple turbines face more resistance than
single turbines (Devine-Wright 2004). Micro-wind turbines have some-
times been touted as an alternative to large machines, but some argue that
these are inconsequential energy suppliers except in low-demand, remote
applications (Mackay 2009).
Not All Large Projects Have Significant Impacts
Not every large-scale solar and wind project has such negative eco-
logical impacts, and not every project has generated public opposition.
Denmark has gone quite far in deploying on-and off-shore wind farms,
based on very large turbines (which can be easier for some birds to
navigate – though the turbine tips move much more swiftly). There are
serious concerns about the impacts of these wind generators on birds
and the ideal sites for turbines are usually also important flyways. Where
objections have been raised, it is primarily about impacts on the “views-
cape,” as in the case of proposed windfarms off the Massachusetts coast
and islands (ironically opposed by Robert Kennedy Jr. who lambasted
environmentalists for opposing BrightSource, the case described above).
But there is no reason why large-scale projects in ecologically-sensitive
areas are the only way to go. There are numerous degraded landscapes
throughout the desert southwest – abandoned mines, agricultural
lands, etc. – where large-scale projects might be more appropriate. For
example, the Aqua Caliente project will provide 290 MW of electric
power on 2,400 acres of former agricultural lands, where no endangered
species or cultural resources are present. But activists engaged in these
issues emphasize the need to develop distributed energy resources first.
It has been estimated, for example, that the technical potential for
rooftop photovoltaic generation in California exceeds 70 Gigawatts

(GW) (CEC 2007), compared to a peak summer demand of less than 60

GW (CEC 2011).
Tackling Energy Poverty, Improving Human Security
The three projects described above are all located in the Global North,
where electricity supplies are plentiful, if sometimes costly, and consum-
ers suffer few, if any, power shortages. The same cannot be said across
vast swath of the Global South, where urban and industrial demand for
energy is rising rapidly. The common response is to build large-scale
plants, whether hydroelectric, coal or nuclear. We will not reiterate the
risks and hazards of these energy sources, except to note that, quite often,
those most affected by the negative externalities of nearby energy produc-
tion facilities often realize the fewest benefits from them. For the most
part, energy, especially electricity, is directed to those areas where there
is at least some semblance of a distribution system and consumers with
some potential to pay for the energy. Europe has made plans to build
large-scale solar generating plants across North Africa, sending most, if
not all, of the power across the Mediterranean. The host countries will
realize royalties from use of their solar resources, but their people, and
especially the poor, are unlikely to gain much access to that electricity.
By contrast, DG has already made an impact across the Global South,
especially in areas remote from power grids, enhancing human security
while obviating many of the externalities associated with centralized
systems. PV electricity has reached grid parity in areas where there is cur-
rently no electricity infrastructure, with such efforts dating back to the
1970s, when a humanitarian named Father Verspieren sought to electrify
remote parts of African with PV (Perlin 1999). Today, organizations such
as ‘Engineers without Borders’ are making great strides in installing PV,
biogas, and micro-hydro systems in remote villages, providing light to
hospital maternity wards and refrigeration to keep vaccines cool. There
are major challenges in using DG PV for rural electrification including
bringing down the cost of delivering these systems to remote parts of the
world, as well as ensuring that local communities are adequately trained
to operate, maintain and repair systems. Nonetheless, there are also
major successes. In Chasing the Sun, for example, Neville Williams (2005)
recounts efforts to electrify and light places mired in energy poverty. His
Solar Electric Light Fund has helped assist anti-poverty NGOs to raise
the standard of living for thousands of people who, in the absence of any
adequate electricity infrastructure, previously relied on wood and charcoal
for cooking, and kerosene for lighting.

THE COSTS AND BENEFITS OF RENEWABLE

DISTRIBUTED GENERATION
A key political principle in operation around the world today is sub-

sidiarity, the proposition that policies and practices should be imple-
mented by the least centralized authority. Historically, the inefficiencies
of utility competition in the same market as well as economies of scale
drove the consolidation and enlargement of energy-producing companies.
Moreover, as air and water pollution came to be of growing concern,
regulation of a few large point sources was much more straightforward
than many small ones. But such pollution disappears with renewable DG.
Moreover, while economies of scale operate on the production side of
renewable technologies, it is not relevant on the supply side, where much
of the retail cost of electricity, in particular, is attributable to distribution,
operation and maintenance of the utility grid. If such grids remain in exist-
ence, for example, in order to provide backup power to DG during periods
of low renewable generation, the costs of maintaining the grid and backup
generators will have to be paid, most probably through some kind of tax
or tariff on DG systems.
Economies of scale are not wholly absent from DG, however; the par-
ticular design and sizing of a DG system will make a difference in terms
of reliability, flexibility and vulnerability and, by extension, for human
security. The relatively high cost of single unit systems, such as rooftop
PVs supplying a single house, the intermittent nature of wind and solar
energy and the problem of energy storage for high load and low energy
flux periods today make DG feasible only for consumers with adequate
access to capital. One consequence is that those most in need of low-cost,
reliable energy – the poor and elderly – can least afford renewables.
One potential approach to these shortcomings are renewable energy
“microgrids,” combined power and heating systems that serve, as noted
earlier, bounded neighborhoods and districts. Such a microgrid might, for
example, include rooftop PV and solar water heaters, wind microturbines,
heat pumps providing district heating, cooling and hot water, energy
storage in the form of batteries, water tanks, compressed air and electric
vehicles, possibly a biogas digester, and various monitors and control-
lers. Of course such major overhauls in energy supply technology must be
complemented by demand management, including conservation improve-
ments in buildings, replacement of inefficient appliances, real-time energy
use information, incentives for load-shifting as feasible, timed devices on
washers and dryers, and so on. If necessary, a microgrid can be hooked
into the larger utility grid, pumping surplus power into it and drawing
power from it when local supply drops below demand.

One important impact of climate change is higher temperatures in urban

areas, from the urban heat island effect. The urban heat island effect is
caused largely by human-made developments that emit thermal radiation
at night, preventing cities from cooling the way that suburban and rural
areas do. This presents an opportunity for DG to be deployed to make
cities more resilient to the impacts of climate change. DG PV can be used
to cover parking lots and buildings, thereby lessening the quantity of solar
energy absorbed by pavement and other thermal masses that are primary
constituents of the heat island effect. These systems would also reduce the
losses from transmitted electricity, and allow for better integration of peak
shaving strategies such as PV-powered air conditioning for large buildings.
A number of ancillary questions arise with such DG microgrids. Who
will manage and maintain them? This could be done either by a com-
mittee of users, some of whom would need to be knowledgeable about
or trained in system mechanics and requirements. Alternatively, man-
agement companies providing such services – a potential new source of
green employment – could be hired for the task. How will microgrids be
financed? Utilities might find it in their interest to pay for microgrids,
billing users for electricity consumed. Or, local power cooperatives may
develop and choose to withdraw from existing energy distribution systems.
Currently, some solar companies will finance solar PV systems upfront,
either retaining ownership or through a long-term loan, in return for
payments for electricity generated and saved. Another approach involves
bank financing of cooperative ownership shares: on the island of Samsø in
Denmark, shares in wind turbines were financed through 10–20-year loans
repaid through the monthly revenue from the sale of wind-generated elec-
tricity. What risks and hazards are associated with microgrids? Clearly, no
technological system is failsafe and foolproof. People fall off roofs; birds
try to fly through wind turbines; blackouts don’t disappear; toxics are
not eliminated from either the front or back ends of renewable energy life
cycles. Overall, however, the net benefits of DG as opposed to centralized
renewables, especially in terms of human security, appear to outweigh the
costs, especially for the poor.
Which Road This Time?
Energy supply systems and companies are notoriously slow to change:

there are no longer Seven Sisters in petroleum, but their descendents
continue to operate globally and with relative impunity. Oil remains the
mainstay of transportation while coal dominates electricity generation
with natural gas rapidly catching up. New large hydropower sites are
limited, and low-head and run-of-river hydro attracts little attention

or enthusiasm. Notwithstanding talk of a “nuclear renaissance,” that

resource seems unlikely to expand very much in the future, especially
in light of the Fukushima accident(s) and commitments by several
European governments to a fully-renewable electricity grid by 2050. Other
non-carbon based energy sources are almost all seen in terms of central-
ized plants, and none of them has effectively made the jump from demon-
stration to commercialization, although this could change in the future.
A considerable fraction of current and future growth in renewable
energy is in the form of centralized facilities. We have suggested that
decentralized renewables, in the form of distributed generation systems,
hold numerous advantages over centralized solar and wind plants. We
have also proposed – and there is solid evidence to support this second
claim – that small-scale renewables hold considerable potential for
addressing the energy poverty and health-related problems facing billions
of the world’s people. This does not mean that such technologies can be
transplanted easily – experience over the past four decades illustrates the
need for local capacity as well as a reliable supply of spare parts – but
microgrids can reduce the need for capital-intensive power plants, and can
be installed much more quickly than large-scale transmission corridors.
What of Lovins’s argument regarding the authoritarianism of central-
ized power and the democratic tendencies of decentralized renewables?
For better or worse, the history of the past 40 years offers only limited evi-
dence of support for his claim. Centralized power seems largely indifferent
to political institutions, although there is ample evidence that the reverse
is not the case. Moreover, there is evidence to support the proposition
that democracies tend to pay greater attention to the environment than
do non-democracies but, once again, this has little to do with scale. But
these observations say little or nothing about causality. Many claims have
been made for the liberating and democratizing qualities of the Internet,
surely one of the most decentralized technological infrastructures to have
ever existed. In some instances, social activism through such media seems
to have assisted, if not enabled, democracy movements and challenges to
authoritarian governments. But the Internet has proven, too, to be easily
monitored and managed, especially if a government is not especially con-
cerned about the effects of such control on commerce. To become entirely
autonomous, as growing numbers of many defense-related and corporate
intranets have done out of the need to protect themselves against hackers,
is to be cut off from the world. The parallel with renewable DG is not
entirely accurate, but any organized government determined to impose its
authority on a population could probably mobilize the force required to
garrison and control DG facilities.
We have argued that renewable DG does have the potential to make

major impacts on quality of life and human security for billions of the
world’s inhabitants. Some will argue that the costs of an effort to provide
these benefits to the global poor are too great, and that economic growth
in the Global North and South will, ultimately, provide more opportu-
nities. Yet, this begs the question. Much of the North’s aging electrical
infrastructure will have to be replaced over the coming years, while the
demand for energy in the South will certainly continue to increase. In
other words, literally trillions of dollars will be spent on constructing new
power plants and distribution systems. The diversion of even a fraction of
this investment could go a long way toward penetration of renewable DGs
throughout the world, reducing their cost and increasing their reliability,
and ameliorating the poverty now experienced by so many. This could also
have the additional salutary effects of reducing greenhouse gas emissions,
mitigating some degree of future climate change, lessening political and
military pressures on supplies of cheap oil and setting the stage for global
sustainability. These goals might seem utopian to some, but there is no
technological or economic reason they cannot be achieved over the next 50
years.
Not all roads lead to political utopias, and choosing the path to greater
freedom ought not to depend on whether a vehicle’s steering tends to
the left or the right. What is important is a people’s political capacity to
make and effect decisions, such as whether to go down the centralized or
decentralized path. Technologies are political; technologies have politics;
but technologies do not determine what forms political practices will take.
That requires activism, action and determination. That, however, is a
topic for another chapter in another volume.
NOTES
1. Of course, electricity generation using fossil fuels can also be highly localized, although
this generally requires transport of the fuels from sites of production and processing to
end use. “Small” electricity and heat-generating nuclear plants have been proposed and
designed at various times over the past 50 years, but none has ever been made commer-
cially available.
2. The current glut of fracked natural gas in the United States has led to a collapse in prices
that is undermining the economic viability of renewables, much as happened following
the collapse of oil prices in the 1980s.
3. The cost of electricity would depend on a range of factors, so it is impossible in this
chapter to compare relative prices from conventional, nuclear and centralized vs. DG
generation in 2040.
4. This problem arises because surplus power causes the electric meter to “run backwards.”
In effect the customer is “storing” electricity in the grid for future use, without paying
anything for that function.
5. Which is not to say that growing concentration of assets and control is absent from

global telecommunications and the Internet. But these large corporations are, for the
most part, not allotted restricted territories in which they can operate.
6. DSIRE is the “Database of State Incentives for Renewables & Efficiency,” maintained
by the North Carolina Solar Center at North Carolina State University, and funded by
the U.S. Department of Energy.
7. This may under- or over-estimate the actual footprint of this renewable energy capac-
ity; the calculation is based on estimates made at the U.S. National Renewable Energy
Laboratory (NREL 2004; Denholm et al. 2009b).
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23. Human security and energy security:
a sustainable energy system as a public
good
Sylvia I. Karlsson-Vinkhuyzen and
Nigel Jollands*
INTRODUCTION
This chapter is dedicated to the concept of human security and its link
to energy and energy governance, particularly global energy governance.
Through this focus emerges the need to look at the links between the
concept of public goods and energy. Our starting argument is that con-
ventional notions of energy security that are centred on the nation state
are insufficient to ensure human security at an individual level (across the
globe). Rather, what we refer to as ‘deep energy security’ is a necessary
condition for human security and such security in turn requires a sustaina-
ble energy system. We further argue that one approach to strengthen deep
energy security is to use the lens of the public goods concept to consider
how aspects of a sustainable energy system should be provided.
The chapter is structured as follows. We start by exploring the evolu-
tion of the concept of human security and its major components and then
analyse the various ways through which energy is linked to this concept.
We look at the links between energy and human well-being and security
and between energy and human ill-being and insecurity. We then explore
the contrast between the concept of human security and the conventional
way in which energy security has been framed, contrasting the individual
with the collective perspective. We then argue that conventional energy
security is not sufficient to deliver human security and propose the notion
of deep energy security as a more comprehensive and appropriate concept.
This concept is closely linked to the sustainability of energy systems, par-
ticularly the global energy system. In the following section we turn our
attention to how deep energy security could be provided, with a first step
in approaching the sustainability of energy systems as public goods at all
levels, particularly the global level. This requires an elaboration of the
definition and theory of public goods and how they need to be provided.
Acknowledging the need for a multilevel and multilayered provision
507

approach for this public good we examine in more detail what and how
much of this good should be provided through global energy governance
and then we briefly explore the current practice of global energy govern-
ance before drawing some conclusions.
ENERGY AND HUMAN SECURITY: FROM

NATIONAL AND COLLECTIVE TO INDIVIDUAL
AND GLOBAL
As we move into the 21st century, there is little doubt that humanity faces
daunting energy-related challenges. Access to affordable energy sources is
increasingly challenging for countries – a situation that is likely to become
worse as fossil fuels prices inevitably increase further. In addition, 2–3
billion people lacking access to modern energy services (AGECC, 2010)
and fossil fuels account for 60 per cent of greenhouse gas emissions causing
climate change.1 The need for a transition to sustainable energy produc-
tion and consumption patterns, not only within national contexts but also
across the whole globe, is increasingly acknowledged by a broad spectrum
of commentators and decision makers (AGECC, 2010; Bradbrook and
Wahnschafft, 2005; ElBaradei, 2008; Jäger and Cornell, 2011; Nilsson et
al., 2012; Alabi, Chapter 4 this volume; Peters and Westphal, Chapter 5
this volume). Yet progress is slow. One of the reasons for this, we argue,
is the entrapment of energy policymaking within the paradigm of national
security. Energy security is considered vital for national security and poli-
cies are largely made within that framework even if many countries are
paying increasing attention to other concerns (including transnational
ones) such as air pollution, climate change and energy poverty and thus
various dimensions of sustainability. One implication of this national
security paradigm is not only that insufficient attention is given to conse-
quences of energy policies for other countries, their citizens, and the global
environment, but also that the potential for cross-border collaboration
on energy issues is not realised. Energy choices are focused on affordable
energy for the national economy and military needs. Energy security is
considered as a national public good with its provision set as a priority for
government attention. Collaboration with other countries does not come
easily within this paradigm and many win-win opportunities in energy
investments, technology cooperation and governance are foregone.
An alternative security paradigm for energy policy is human security.
This concept was introduced in 1994 in the UNDP Human Development
Report in an effort to make human development challenges more imme-
diate policy concerns. The UNDP identified six types of security beyond

Human security and energy security 509
security from physical violence: income security, food security, health

security, environmental security, personal security, community security
and political security (UNDP, 1994). This effort, followed by consid-
erable academic and policy attention particularly at the global level,
changes the focus on the object that should be protected and that should
be secure – from states and their sovereignty and territorial integrity to
individual human beings and their survival, human development, iden-
tity and governance (Liotta, 2002). Human security is not only about the
physical safety of persons (freedom from fear) but also about their ability
to obtain and hold basic goods (freedom from want) (Gasper, 2005). This
shift brings a change in attention towards those that are most vulnerable
(Owen, 2008). The concept of human security was particularly elaborated
by the Ogata-Sen Commission in their report Human Security Now that
defined it as ‘to protect the vital core of all human lives in ways that
enhance human freedoms and human fulfilment’ (Commission on Human
Security, 2003:4).
Gasper (2005) outlines how the human security concept serves as the
container for a discourse and an ‘intellectual boundary object’ that merges
concerns from three other discourses; basic human needs, human develop-
ment and human rights. The roots in human rights brings ‘the unwilling-
ness to sacrifice anyone’ and the basic human needs discourse a ‘stress on
prioritization’ (Gasper, 2005:234). Furthermore, human rights tend to
highlight not only the rights but the duties of (someone) to ensure those
rights and thus a discussion on duties and accountability (Gasper, 2005).
The security concept attempts to connect with the national security world
where funding and organisational power are at higher levels and indirectly
connects to the accountability structure of the UN System and its work
on monitoring of humanitarian crises, Millennium Development Goals
etc. (Gasper, 2005). The shift from national to human security means that
the issue of who can or should provide security for whom changes. Some
consider that states should still have the major responsibility to ensure
human security but a human security focus raises the concern from being
limited to citizens within a particular state to citizens of all states, to global
citizens. Can states adopt such a global perspective in their policy-making?
We return to this below.2
Energy was not mentioned either in the UNDP report of 1994 (UNDP,
1994) or in the Ogata-Sen Commission report (Commission on Human
Security, 2003).3 It is also quite invisible in the academic literature on
human security. Nonetheless, the contribution of energy to human secu-
rity can be explicitly linked to at least four of the six security dimensions
that were in the original UNDP definition of human security (UNDP,
1994); economic security, food security, health security, environmental

security. Even for the last three categories – personal, community and
political security – one can identify links to aspects of energy production
or consumption. The links between energy and the various dimensions
of human security can be divided into two major categories; the links
between energy access/consumption and human well-being/security and
between certain types of energy production and consumption and human
‘ill-being’/insecurity. The following sections explore these two categories
of links in more detail.
Energy, Human Well-Being and Security
Whenever anything happens, anywhere, anytime, it is because energy is

transformed from one form to another. Not surprisingly, the ability to
harness energy for human use has been a vital element of human security
for millennia. From learning to use fire for food preparation, heating and
protection, to the development of technologies to capture the energy of
wind, animals, etc. energy has been used by humans to transform indi-
vidual and societal life (Smil, 1994). This transformation has often meant
increasing individual well-being and security. This development has pro-
gressed through the industrial revolution that was very much enabled by
the ability to use cheap fossil fuels. All modern technologies that make life
easier, healthier and more secure require access to modern energy; from
fridges for vaccines to kitchen appliances and cars. While it should be
acknowledged that the production and use of energy also has its costs (see
discussion below), it is clear that modern energy has had a significant posi-
tive impact on many aspects of human well-being and security.
This development of increased well-being and human security has,
however, in a global context been very unequal both between and par-
ticularly within countries. For example, around 2.7 billion people lack
access to modern energy services for cooking and heating and around
1.94 million people in developing countries die each year from respira-
tory infections as a result of exposure to pollution from solid fuels, see
Bhattacharyya (Chapter 19, this volume). The unequal energy use situa-
tion is most vividly illustrated by the picture of the Earth at night. Many
regions such as urban centres in North America and Europe are bathed in
light while others, such as much of Africa, are almost entirely dark.
The links between access to modern energy and human well-being and
security are clear and convincing. However, as energy has been so absent
in the literature on human security it is also relevant to briefly describe
the links to the specific dimensions of security in more detail (the links
particularly to economic and health security are discussed in more detail
in Chapter 19 of this volume).

● Economic security relates to the ability to make livelihoods on a sus-

tainable basis. On a macro scale this is a major reason for governments
to pursue secure energy supplies to ensure economic development
and indeed national security. Economic development means income
security for a larger portion of the population. On a micro scale when
the focus is poverty reduction there is clear evidence that access to
modern energy services improves livelihoods of the poor in developing
countries. Access to cleaner energy options (than traditional fuels for
example) can improve working conditions and can provide new job
opportunities in sustainable energy sectors (GEA, 2012).
● Food security at the household level can also be linked to access to
modern energy services. Most staple foods need to be cooked before
consumption thus access to heat energy is essential. Liberating
the time (and indeed human energy) that women spend collecting
fire wood, pump water and mill grains by hand through access to
energy services would give more time for work on the productivity
of their land (or on other income-generating activities) (GEA, 2012).
Modern and affordable energy used for irrigation directly strength-
ens the food security of the poor (GEA, 2012). Another area where
access to modern energy services is linked to improving food security
is the reduction of post-harvest losses due to inadequate facilities for
harvest, storage and transport (GEA, 2012). Furthermore, on a
global scale intensive large scale agriculture increases the availability
of food for international trade and this type of agriculture is highly
dependent on energy in fertiliser production, irrigation, harvesting
and transport (GEA, 2012).
● Health security is linked to energy access in several ways. The most
prominent link is between the particulates from the combustion of
poor-quality cooking fuels and respiratory disorders. The illness and
death of millions of primarily women and children every year are
directly related to their exposure to the smoke from cooking fuels,
see Bhattacharyya (Chapter 19, this volume). There is however also
a very strong link between energy and health security in the running
of modern health care facilities that require access to electricity and
affordable fuels (GEA, 2012).4
Energy, Ill-Being and Insecurity
The ability to harness an expanding list of energy types through techno-

logical innovations is a twin-edged sword. On the one hand it has delivered
huge benefits. On the other hand, it has a led to significant insecurity and
ill-being for many human beings and indeed states.

● Environmental security comes when human beings have a healthy

physical environment. Modern energy production and consumption
links to human insecurity through environmental degradation and
climate change that affects economic, food, health or even personal,
community and political security of people. These links can either
be manifested in insecurity emerging slowly over time or come as a
result of sudden disasters and they can occur within or across state
borders.
The extraction, production and use of many modern forms of
energy degrades or even destroys the environment locally or glo-
bally. The mining of coal or drilling of oil can create health hazards
for workers involved in the process or the population living close
by (consider for example oil extraction in the Niger Delta). The
use of nuclear power for generating energy can cause disasters
with major implications for human security (e.g. Chernobyl and
Fukushima). The burning of fossil fuels is a major source of local
and regional air pollution with associated health implications in
cities around the world.5 The burning of fossil fuels is also, as
mentioned above, the major source of greenhouse gases causing
climate change – accounting for around 60 per cent of total global
greenhouse emissions.6 Climate change in turn has a number of
implications for human (in)security some of which are related to
health such as changed patterns of infectious diseases, others linked
to food security (from changed weather patterns and agricultural
potential) or physical safety such as extreme weather events (storms,
floods and over longer time horizons sea-level rise) which will con-
tribute to migration and associated income insecurity.7
● Personal security is defined as people’s security from physical vio-
lence (UNDP, 1994). The most obvious contribution of energy to
insecurity in this sense is the enabling of ever more powerful tech-
nologies of war including nuclear weapons. Furthermore, after the
nationalisation of many countries’ fossil fuel reserves in the 1970s
some countries in the west started to look at disruptions of energy
supply as a national security issue that should be counteracted by
military strategy (Peters, 2004). This has obvious implications for
human security in relation to physical violence. Energy sources
are generally seen as a cause of conflict in international relations
(Peters and Westphal, Chapter 5, this volume).8 Podobnik (2002)
argues that the unequal distribution of energy consumption is a
risk for future conflicts, and the increasing scarcity of particularly
oil may exacerbate this. The scramble for new oil extraction areas
for example in the Arctic could be seen as an indication of this.

Another contribution of energy to insecurity is through the so called

‘resource curse’. This concept implies that countries with consider-
able natural resource assets (such as oil), are more prone to internal
conflict thus linked to both personal and political security, see for
example de Soysa (2002) and Chapter 5 of the GEA (2012).
● Community security comes from the fact that ‘[m]ost people derive
security from their membership in a group – a family, a commu-
nity, an organisation, a racial or ethnic group that can provide a
cultural identity and a reassuring set of values’ (UNDP, 1994:31).
Any impact on communities’ ability to indeed live as a community
is thus a cause of human insecurity. Among such impacts related to
energy production are displacements of whole communities for the
building of hydropower dams or drilling of oil on land. The expected
forced migrations of even whole countries (low lying islands) from
climate changed induced sea-level rise will be a result of consump-
tion of fossil fuels (and other greenhouse gas emitting activities).
On the other hand, one can argue that in some communities and
cultures excessive consumption of energy is a defining element of
their identity, such as communities built on the dependence of car
and airplane transport.
● Political security, finally, is about people’s ability to live in countries
where their basic human rights are protected, including their civil
and political rights. Here the link to energy production and con-
sumption is tenuous but de Soysa (2002:30) argues that the research
community ‘needs denser analyses of how resource abundance is
associated with conflict through what some observers characterise as
the ‘spoils politics’ of clientelism, corruption, and extrainstitutional
“governance,” a pervasive feature of politics in resource-abundant
countries, particularly in Africa’. On the other hand, the access to
electricity is a pre-requisite for the ability to use cell-phones and
the internet, and the associated social media that may play a role in
supporting more open and democratic societies.
Deep Energy Security and the Sustainability of Energy Systems
Clearly, current notions of energy security are not delivering human

security in all its dimensions. What is needed is a new approach to energy
security that captures the notion that all human beings, including future
generations, are entitled to benefit from modern energy services and at the
same time be protected from their negative side-effects. In this context, we
offer the notion of ‘deep energy security’ (DES). Deep energy security is
energy security that contributes to human security over space (from the

local to global) and time (that is, now and for future generations). In this
way, deep energy security embraces both a long-term (multi-generational),
equitable perspective and holistic approach to the energy system. There
are clear parallels between the concept of DES and the sustainability of
the energy system. Indeed, we argue in this chapter that DES and the
sustainability of the energy system are intertwined. Furthermore, this
interconnection could be considered as a nested dependency – where the
sustainability of the energy system is a necessary, but not sufficient, condi-
tion for DES, and DES is in turn a necessary, but not sufficient, condition
for human security. Despite their close relation the concepts of a sustain-
able energy system and deep energy security are distinct. An energy system
with occasional disturbances may still be considered ‘sustainable’ but not
deeply energy secure. The DES concept adds a focus on immediate indi-
vidual well-being and security while sustainability is a crucial aspect for
ensuring DES also for future generations.
At this point, it is important to point out that we take a broad definition
of the energy system to include (Karlsson-Vinkhuyzen et al., 2012:13):
● the physical infrastructure needed to extract, transport, transform and use

energy;
● the physical impacts on the environment and people of energy extraction,
transport, transformation and use;
● the social institutions (such as international agencies, governments and
the regulatory frameworks, markets and civil society groups) designed to
support the flow of energy services; and
● the individual actors involved in using energy services.
Deep energy security goes beyond the concept of ‘comprehensive’ energy

security. Comprehensive security was a concept developed in Japan in the
1970s and 1980s that was focused still on the security of the state but in a
broader sense encompassed both military and economic security (Gasper,
2005).
Deep energy security transcends national boundaries. It is at once
global and individual. That is, it accommodates the moral community as
a global one but maintains the individual (within a community and nation
and dependent on the environment) as the focus of security. An under-
standing of DES is also useful in that it can help with priority setting. That
is, Gasper (2005:241) states, the ‘human security discourse is a discourse
for getting priority, and priorities, in national and international policy.’
Applying this line of logic to DES, it is possible that the proposed concept
of DES could serve a similar purpose in the domain of energy policy.
Defining DES is a useful first step in the process of reforming our notion
of energy security. In the next section, we take the notion of DES one step

further and ask how can deep energy security be achieved – and who, or
what, should provide such DES?
PUBLIC GOODS AND THE SUSTAINABILITY OF

THE ENERGY SYSTEM
The section above noted that DES is dependent on sustainability of the
energy system. If this is the case, then how can the sustainability of the
energy system be provided? We draw on our work in Karlsson-Vinkhuyzen
et al. (2012) to argue that a key approach to answering this question is to
understand the concepts of private and public goods found in economics
literature and to look at the sustainability of the global energy system as a
global public good.
Public and Private Goods
In economics, a good (or service) is considered private or public depend-

ing on two dimensions: excludability and rivalry. For a good to be purely
‘public’ there can be no exclusion of those who refuse to pay for the good
or service to enjoy the benefits (non-excludability). A purely public good
also requires no rivalry among the beneficiaries of the good or service
(non-rivalry). In other words ‘if a public good exists . . . anyone can use it
regardless of who pays for it’ (Daly and Farley, 2004:169).
These concepts deserve attention as they influence opinions as to
whether the good should be considered the domain of the public or
private sector actors. This is important because wrongly assigning a good
or service as private or public can lead to under-provision. And under-
provision of an aspect of a sustainable energy system makes DES and thus
human insecurity impossible to attain.
A good or service is excludable if its ‘ownership allows the owner to use
it while simultaneously denying others the privilege’ (Daly and Farley,
2004:73). It is worth noting that nothing is inherently excludable – policies
or social institutions are required to make any good or service excludable
(Kaul et al., 2003). For example, governments can decide to privatise
what was previously provided freely by public institutions (such as water
supply, and exclude people from the service through the application of
water-use tariffs) or bring into public ownership what was previously
operated privately (such as nationalising oil companies in Iran in 1951 and
India in the 1970s for purported public benefits).
On the other hand, some goods or services are inherently non-excludable
as a physical characteristic. Examples of such non-excludable goods or

services include flood regulation. In the absence of an institution or tech-

nology being able to enforce exclusion, these are known as non-excludable
goods or services. A good or service is ‘rival in consumption’ when one
person’s use reduces the amount available for everyone else. For example,
my use of electricity in my home reduces the amount available for my
neighbours. Conversely, a non-rival good or service is where its use by one
person does not impact on another’s use – my reliance on the climate regu-
lation eco-system service to ensure that my London home is not destroyed
by a hurricane does not decrease the amount of climate regulation avail-
able for my neighbours. In the context of energy, some of the renewable
energy sources are virtually non-rival, such as sunlight, and, to a certain
extent, wind and wave energy. It is important to note that ‘rivaleness is a
physical characteristic of a good or service and is not affected by human
institutions’ (Daly and Farley, 2004:73). Furthermore, non-rivalry is dif-
ferent from abundance. For example, seats at a football arena are rival;
if one person occupies a seat, another cannot at the same time. However,
if not all seats are filled there is no competition for use and they can be
regarded as abundant. We can limit access to a resource in order to keep
the resource abundant, but it will always be rival (Karlsson-Vinkhuyzen
et al., 2012).
The theories around public goods have been centred in the context of
local or national governance, however, the concept is also applicable at a
‘global’ level. The global attribute lifts the perspective to goods which yield
benefits for all countries, people and generations (Kaul et al., 2003:10).
Thus, it is possible to identify what are referred to as global public
goods – an important concept in the discussion of addressing many global
sustainable energy system issues (Karlsson-Vinkhuyzen et al., 2012).
PUBLIC GOODS, THE PROVISION OF ENERGY

SYSTEM SUSTAINABILITY AND HUMAN
SECURITY
Economic literature is clear that public goods will not be efficiently (in
a Pareto sense) provided by the market (Stiglitz, 2000). In this case, it is
argued that there is a clear role for governments in delivering public goods
and services. The benefits flowing from the sustainability of the energy
system (whether local or global) such as reduced rate of depletion of
natural capital or reduced impact on the climate system, can be considered
public goods – and in some cases global public goods. This is because it
would be difficult to exclude anyone from those benefits. Furthermore, my
enjoyment of such benefits do not reduce (rival) another’s ability to take

advantage of those benefits. This means that we can look at the sustain-
ability of the energy system at any scale as a public good and particularly
at the sustainability of the global energy system as a global public good. It
is important to note that it is only possible to look at energy (which in its
consumption is both rival and excludable) as a public good by adopting a
system perspective. The sustainability of the system (which includes envi-
ronmental, social and economic sustainability dimensions) is analytically
possible to approach as a public good (Karlsson-Vinkhuyzen et al., 2012).
This analytical approach makes it very easy to explain why this public
good, and DES that relies on it, is most effectively provided by public
institutions.
Unfortunately, public goods are usually underprovided as a result of the
collective action problem which their publicness generates – particularlyin
the case of global public goods (Conceição, 2003). This is clearly also the
case for a sustainable global energy system. At lower levels of governance
it is increasingly common for governments to take the main responsibil-
ity for the provision of the public good elements of a sustainable energy
system. For example, many local governments are putting in place policies
to mitigate the air-quality impact of particulate emissions from heating-
fuel combustion (linked to environmental and health security), and most
national governments are implementing active energy efficiency and
renewable energy policy programmes. There is even increasing collabo-
ration on energy in mostly regional intergovernmental contexts such as
IEA, ASEAN, APEC and the EU. But these attempts are still too nar-
rowly focused to be able to address the broad sustainability concerns of
the energy system. All together the efforts at local, national and regional
levels fall far short of what it takes to build up a sustainable energy system,
particularly globally.
In the global governance context the provision of elements of a sustain-
able energy system is, of course, much more challenging where all joint
action is based on voluntary cooperation among close to 200 states with
diverse interests. Having established that the provision of the sustain-
ability of the global energy system also requires the contribution of public
sector providers, in the next section we consider the governance issues of
‘what’ and ‘how much’ should be provided at the global level.
GLOBAL ENERGY GOVERNANCE AND DEEP

ENERGY SECURITY
The switch from state-centric energy security to DES implies a shift in the
means and mechanisms that are best suited to secure humanity and make

‘people free from fear and want and indignity’ (Gasper, 2005:240). Such
a switch also raises the key governance issues of what and how much of a
sustainable energy system should be provided at the global level if we see
such a system as a prerequisite for achieving DES.
Global Level Provision – What and How Much – In Theory
Global public goods do not necessarily have to be provided by global

(intergovernmental or other) actors. At a general level the provision of a
global public good requires a multilayered approach to governance where
measures by diverse actors across governance levels aim for a common
objective. If actors at local, national and regional level, across the globe,
provided substantial contributions to a global sustainable energy system
then there may not be much need for action at global level. This is,
however, far from the case and we argue there is considerable room for
global energy governance. The concept of governance can be seen to imply
that there are actors who are taking cooperative action for their common
affairs (Commission on Global Governance, 1995). Using this definition,
‘global energy governance’ would encompass those measures that have as
objective to manage energy as a common affair in the international com-
munity (Karlsson-Vinkhuyzen, 2010).
Barrett’s (2007) categorisation of GPGs linked to their provision needs
illustrates why global energy governance is needed. He divides GPGs into
four categories:
● single best-effort GPGs where the provision depends on the single

best (unilateral or collective) effort (knowledge of cures for diseases);
● weakest link GPGs where provision depends on the weakest indi-
vidual effort (control of pandemics);
● aggregate effort GPGs where it depends on the combined effort of
all countries and actors (for example, the Kyoto Protocol’s attempts
to address climate change); and
● mutual restraint GPGs where states agree to avoid doing certain
things (for example, the Montreal Protocol’s efforts to phase out
ozone-depleting substances).
The multiple actions required to deliver a global sustainable energy system

would fall under the aggregate effort, which as pointed out above could
in theory be reached by aggregate efforts at sub global levels. One can of
course imagine single countries putting a lot of resources into e.g. fusion
research and if that was successful some would argue that the energy pro-
vision of the future would be solved. This scenario is unlikely, however,

and it would still require an enormous aggregate effort to change all the
infrastructure to fit a new type of energy resource. One could also imagine
that some would consider nuclear energy as coming with such risks that it
should not be part of a sustainable energy system. In that case there would
also be need for mutual restraint among countries to avoid building more
nuclear power plants.
Having established the need for some level of global energy govern-
ance, the question we raise here is how much such governance is needed.
This can be answered based on various allocation criteria. The authors
applied the subsidiarity principle with its associated criteria of effec-
tiveness and necessity used within the European Union to answer this
question and concluded that global provision (through collaboration) is
(Karlsson-Vinkhuyzen et al., 2012:14):
1) effective
● when addressing GPG dimensions to policies themselves which
are unlikely to be addressed by individual countries or the market
such as knowledge and norms promoting sustainable energy;
● when it aims to strengthen the coherence of the international com-
munity’s governance (coordinating ad hoc efforts and avoiding
overlaps).
2) necessary
● when lower levels of governance do not have the capacity or will to
take action to promote sustainable energy; or
● when global institutions (both norms and organisations) are con-
tributing to preserving a fossil-fuel based unsustainable energy
system.
If these two criteria were applied we could imagine a range of initiatives

in global energy governance. These could include: collaborative research
projects through pooling of research resources, extensive knowledge
sharing mechanisms; international norms (including treaties) setting stand-
ards for production and consumption parameters related to sustainability;
ambitious coordination mechanisms among existing intergovernmental
organisations with activities supporting energy for sustainable develop-
ment or even setting up new organisations for this purpose; large-scale
capacity building and awareness raising programmes for countries who
are doing very little in the field; and radical reorientation of international
trade and financial institutions from implicit and explicit support to fossil
fuels towards support for building a sustainable energy system globally
and ensuring deep energy security within and across states. This is the
picture in theory if the principle of subsidiarity and its effectiveness and

necessity criteria were applied. In practice global energy governance looks

quite different.
Global Level Provision – What and How Much – In Practice
In practice global energy governance, defined as supporting a common

objective in the form of a sustainable energy system, is fragmented and
dispersed without a strong institutional framework whether in the form
of norms or organisations set up for the purpose (Karlsson-Vinkhuyzen,
2010). There are certainly many initiatives and activities by international
organisations, by bilateral donor agencies, private-public partnerships
and non-governmental organisations that support a sustainable energy
system. Descriptions, and to some degree analysis, of these can be found
in several reports from the UN system, research reports and papers (Ad
Hoc Inter-Agency Task Force on Energy, 2002; Florini and Sovacool,
2011; Gupta and Ivanova, 2009; Karlsson-Vinkhuyzen et al., 2012;
Lesage et al., 2009, 2010; Modi et al., 2005; Steiner et al., 2006; UN-
Energy, 2006). Compared to the need, however, these activities are still
meagre.
Even more meagre, or almost non-existent, are international norms
developed explicitly to support a sustainable energy system. The few efforts
that have been made to develop soft (non-legally binding) norms have
either been very vague and non-committing, see for example the text on
energy in the outcome of the United Nations Conference on Environment
and Development in 1992 (UNCED, 1993), the World Summit on
Sustainable Development in 2002 (United Nations, 2002), and the United
Nations Conference on Sustainable Development in 2012 (United Nations
General Assembly, 2012).9 The Commission on Sustainable Development
(CSD), a commission under the United Nations Economic and Social
Council set up in 1993, has been the only forum where ‘energy for sus-
tainable development’ has been discussed at any length in an intergov-
ernmental, high-level context. The CSD discussed energy in 2001 when
it adopted an outcome text that again was quite general (Commission on
Sustainable Development, 2001) and again in 2006/7 when no agreement
for an outcome text could be reached due to large disagreements on many
of the themes, but particularly on the role of the global level and the UN
in following up on any decisions adopted (Karlsson-Vinkhuyzen, 2010).
This failure in outcome of the CSD dampened the enthusiasm consider-
ably among countries who had wanted to see more of a role for the UN on
sustainable energy. Nonetheless, there were some steps forward after this,
particularly with the UN General Secretary’s launching of the Sustainable
Energy for All initiative and the announcement of 2012 as the UN year

for this theme and the UN General Assembly declaring 2014–2024 as the
Decade of Sustainable Energy for All.10
The Sustainable Energy for All initiative brings together a number of
UN organisations as well as international public-private partnerships,
business and other organisations. In terms of organisations, however,
there is no organisation within the UN system whose exclusive mission
is energy, except the International Atomic Energy Agency whose focus is
exclusively on nuclear energy. Many UN organisations work with energy
but often according to their own mandate and the degree of coordination
and cooperation across the UN system is limited (Karlsson-Vinkhuyzen,
2010). The establishment of UN-Energy in 2004 as a permanent inter-
agency mechanism was an effort to address this gap in coordination.
This non-organisation (it has no staff, no budget etc.) is open to all
organisations in the UN system, including the Bretton Woods institutions.
Representatives of its members meet regularly, share information, stimu-
late cooperation and occasionally produce publications, for example with
overviews of energy activities in the UN system (UN-Energy, 2006). The
future of UN-Energy is, however, uncertain and this mechanism is search-
ing for its role in the governance landscape (UN-Energy, 2010).
Outside the UN system the International Energy Agency has since
the late 1990s started to expand on its original mandate to provide
security in access to fossil fuels such as oil, and has dedicated efforts
to the climate change dimension of energy including energy efficiency
and renewable energy (Van de Graaf and Lesage, 2009). In 2009 the
first intergovernmental organisation dedicated to renewable energy, the
International Renewable Energy Agency (IRENA), was established indi-
cating a strengthened political will for international collaboration in this
field. The organisation has in short time attracted 101 states as members
and an additional 57 states are signatories pending ratification.11
In summary, governments have – with a few exceptions – been reluctant
to develop international norms and institutionalise cooperation around
energy at the global level, particularly in the only universal multilateral
forum, the UN (Karlsson-Vinkhuyzen, 2010). In parallel, the academic
and policy literature on energy has only recently started to use the concept
of global energy governance, and analyse its possible content, role and
main actors (Bradbrook and Wahnschafft, 2005; Florini and Sovacool,
2011; Goldthau and Sovacool, 2012; Goldthau and Witte, 2010; Karlsson-
Vinkhuyzen, 2010; Karlsson-Vinkhuyzen et al., 2012; Lesage et al., 2009,
2010; Steiner et al., 2006).
Not even assessments with an explicit global scope such as the World
Energy Assessment (United Nations Development Programme et al.,
2000), and the energy policy sections in the Fourth Assessment Report of

the IPCC (IPCC, 2007a) discussed the role of global energy governance.
Neither does the Global Energy Assessment do this systematically, but it
does consider the role of international actors and concludes, for example,
in its summary for policy makers that there should be a policy focus in the
near term on enhancing international cooperation in energy technology
research and development and technology standards (GEA, 2012).
CONCLUSION
The human security concept and discourse long remained silent on

energy despite the very strong links between various dimensions of energy
production and consumption and human security and insecurity, links
which lately are more clearly exposed in debates about for example the
Millennium Development Goals. The adoption of the concept of DES as
a necessary condition for providing human security provides an opportu-
nity to approach energy as an ethical and even moral issue. The concept
moves the perspective of energy security from states and the present to
individuals and the future, and it highlights the need to expand the spheres
of concern for states from their own citizens to humanity as a whole
including future generations. This normative stance is perhaps radical in
an energy policy context, but we see this as a fundamental first step in reo-
rienting particularly the governments of the world towards the building of
a global sustainable energy system. By approaching a sustainable energy
system as a global public good it becomes clear what central role govern-
ments have in its provision particularly through global cooperation, a
role of which governments are seemingly unaware, or unwilling to admit
as indicated by the very humble degree of global energy governance. The
current socio-economic-political system has a long way to go to achieve
‘Deep energy security’ but we argue that a useful first step is some intro-
spective reflections, among individuals and governments, on the values
and thus objectives around energy production and consumption that we
see as fundamental for sustainable development and human security in the
coming years and centuries.
NOTES
* The contents of the chapter are the views of the authors and not those of the institutions
for which they work.
1. See http://epa.gov/climatechange/ghgemissions/global.html
2. The idea of individual security is a liberal thought from the Enlightenment and as it
has been treated both as a unique and a collective good it is more difficult to determine

where the responsibility for the ensuring individual security lies (Liotta, 2002) The
idea of global citizenship implies the equal value of all human beings and thus concern
for the implications of policies far beyond state borders. See e.g. Dower and Williams
(2002) for an elaboration of the concept.
3. The exception is the reference to one of the benefits of foreign direct investment
through multilateral corporations as being their ability to introduce more and cleaner
energy.
4. For an elaboration on the links between health and energy see Bhattacharyya (Chapter
19, this volume) and Chapter 4 of the Global Energy Assessment (GEA, 2012).
5. The GEA (2012) for example, estimates that 2.75 million premature deaths occur annu-
ally due to outdoor air pollution from energy systems.
6. See http://epa.gov/climatechange/ghgemissions/global.html.
7. The most comprehensive compilation of climate changes impacts can be found in the
Fourth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC,
2007b).
8. Peters and Westphal (Chapter 5, this volume) and Olaniyi (Chapter 4, this volume)
discuss the possible conflict areas around energy in more detail, the former focusing on
interstate conflicts, the latter on intrastate conflicts.
9. For a discussion and overview of the text and outcome on energy in some of these
Summits see Najam and Cleveland (2003) and Spalding-Fecher et al. (2005).
10. See http://www.sustainableenergyforall.org/about-us (accessed 23 February 2013).
11. This figure is as of 5 November 2012, see http://www.irena.org/ (accessed 23 February
2013).
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PART VII
CONCLUSIONS

24. The political economy of energy security
The International Energy Agency’s (2012) World Energy Outlook devotes

an entire section to a focus on energy efficiency ‘blueprints’, though it
struggles to extend this concern to reducing overall demand (and attend-
ant dismal scenarios for energy policy and climate change), as opposed to
meeting that growing demand (and more equitable supply) with greater
economic efficiency. The conventional assumption seems to be that energy
supply should be stabilized, and that shortages endanger everything from
individual livelihoods to the global political economy. While these assump-
tions are reasonable in the context of ongoing business, the overall objec-
tive of maintaining current practices through short-term management of
supply and price is probably quite unreasonable given the extensive nature
of the challenges indicated by the studies in this volume. The arguments
and insights provided by the various chapters have underwritten the need
to broaden, deepen and transform the understanding of energy security.
This also suggests a tension between a long term perspective on energy
security and a short term one. While the former involves political debates,
and transformation of the governance of energy, the latter makes evident
the implications of the neo-liberal economic approach. The energy secu-
rity debate is characterized by different voices, which are influenced by the
different disciplinary perspectives of the actors involved in the debate. As
Cherp and Jewell (Chapter 8) suggest, the sovereign perspective calls for
state intervention in assuring, for instance, long-term contracts, such as
in the case of gas, and providing stability and order to ensure the smooth
functioning of the oil market. National energy champions are protected
to ensure the provision of energy services. But this national security per-
spective, suggesting a zero sum approach, is itself a cause of insecurity
(as Karlsson and Jollands have pointed out, Chapter 23) increasing the
potential for conflict, not only at global but also at local level (see Alabi,
Chapter 4). This suggests the limitations of the national security discourse
in providing energy security. On the other hand, arguments for liberaliza-
tion are often based on the assumption that the market itself will provide
solutions, often ignoring the implications of the short term perspective
imposed by the market, and the possibility of market failure, including
climate change. The approach of the IEA reflects this perspective with its
commitment to supporting the market and integrating it with mechanisms
529

to deal with crises and emergencies. In the face of such limited perspectives
on energy security, achieving a deeper energy security linked to sustain-
able human development is a significant challenge. What is required is an
integration of the different perspectives, and in this respect reflections on
energy security (and, in this context, who deserves to be protected and by
what means) may help to address the complexity of a reshaping energy
order.
This volume has provided an overview of the existing debates with three
aims: to provide an account of the multiplicity of discourses and meanings
of energy security and contextualizing them; to use the insights from secu-
rity studies debates to understand the implications of framing an issue as a
security issue; to shed light on the need to integrate different perspectives,
overcoming, for instance, the divide between realist/geopolitical perspec-
tives and neoliberal ones, while taking into account environmental and
human security considerations.
The initial part on energy security issues outlined the complexity
of the perspectives involved, the tensions between them, and the dif-
ficulties of reconciling them. Wood examines the meaning of human
security in respect of energy issues, where presumed energy imperatives
test the quality and integrity of the liberal democracy that defines most
post-industrial societies. An end to authoritarianism does not mean
support for a green agenda, nor is it guaranteed that newly emancipated
electorates would demand what environmental lobbies in established
liberal democracies call for. Neither would the emergence of a ‘global
demos’ necessarily result in universal green attitudes and policy: trade-offs
will always be required. Political machinations in the international arena
confront national self-understandings or self-images. Some liberal democ-
racies have reached a modus vivendi with illiberal energy suppliers, and
a few have with illiberal customers, which suggests that ready access to
cheap energy is the current approach to energy security. On the other side
of the energy-climate coin, pressure on human rights and peace-building
is set aside in order to get the maximum number of countries signed up
to internationally-agreed climate change commitments; some even argue
that democratization is a problem.
Brancucci, Pearson and Zeniewski suggest that one’s criteria in defin-
ing energy security often informs policy outlook. They note that physical
interconnections imply both solutions and challenges to security of energy
supply. This is particularly true for the European Union, where all three
pillars of the EU energy policy (sustainability, competitiveness and secu-
rity) converge around a common goal of cross-border infrastructure devel-
opment. Although additional interconnections are often seen as beneficial
to security, the accompanying increase in interdependence should be taken

The political economy of energy security 531
into account. Indeed, this chapter has introduced some of the internal
challenges and vulnerabilities facing the European Union as it attempts to
modernize and inter-connect some of the most complex energy systems on
the globe. This entails uncertainties, and special attention has been paid
to the problems for security of supply engendered by gas market liberali-
zation, renewable energy deployment and the expansion of ICT systems
controlling complex energy networks. These three issues also impact on
the external dimension of EU energy security.
As the liberalization of the internal EU gas market challenges
long-standing relationships with external suppliers, the problems arising
from large-scale deployment of renewables also require external solutions,
such as the import of electricity from solar panels in the Sahara desert.
Thus, the interdependencies between external and internal dimensions will
crucially affect the EU’s overall energy security. Alabi noted that because
of its significant role in fuelling modern industrial economies and military
forces, oil has been the subject of domestic and international conflict,
as actors seek to influence the direction of the market. He also noted
the interrelationship between the energy security agenda of the Western
world and the nature of conflict and underdevelopment in the oil and gas
producing countries in the global south. He concluded that most so-called
resource conflicts occur where groups or societies have been denied ben-
efits from national resources.
Peters and Westphal emphasized that energy is about geography.
Thus, they map hydrocarbon resources as a given underlying reality of
producer – consumer and transit relations – and also observe that the
landscape of energy is undergoing profound change. They show that it
makes a difference how analysts describe and frame development in the
markets. ‘Energy security’ is a question of how this goal is integrated into
the global economy, pluralistic structures, good governance in the sector,
as well as the perceptions of the tightness of the future supply market and
the availability of power projections forces.
The remaining parts of the handbook reviewed the main issues from
within different perspectives on energy security.
SECURITY OF SUPPLY
This part addressed the different strategies to ensure energy of supply.

The relevance of the national security perspective is quite apparent, even if
many of the tools are shaped by a neo-liberal approach.
Thomson and Boey provide an overview of strategic energy reserves
(SERs), a tool that reflects the neoliberal perspective of providing

echanisms to cope with short term crises, and an approach that has
m
been largely endorsed by the IEA. The chapter shows that not all people
believe that creating and maintaining SERs is useful. Some believe there is
little point in having them because they are costly to build and maintain,
and if a supply/price shock is not resolved within a short period of time,
the stockpiling is for naught. Moreover, many regard energy supplies as
fungible commodities, which challenges the contribution of SERs to price
stability vs genuine energy security-related reasons. Hammes provides
an update on how the traditional argument of ensuring security through
diversification of sources and providers, which has been the mantra since
Churchill’s arguments that energy security rests on diversity and diversity
only, now acquires new meaning as new technological solutions and per-
spectives emerge. Cherp and Jewell provide a useful account of the issues
in measuring energy security, presented in historical context. The interest
in measuring energy security results not only from its rising prominence
but also from its increasing complexity, which requires relating energy
security to a common ‘yardstick’. The challenge of measuring energy
security is not only to comprehend natural, technological, and economic
complexities and uncertainties, but also to acknowledge that it has differ-
ent meanings for different people. There is no single set of suitable metrics,
but despite different choices about the definition of energy security, vital
energy systems, key vulnerabilities, indicators and interpretation, all of
this can be reflected in principles of an energy systems approach. Schott
and Campbell addressed the structure of national energy strategies in
the G8 countries and Norway, and evaluated different components of
individual strategies. This contributes to the better understanding of the
importance and meaning of national energy strategies, differences in the
definition of and approach to energy security, and the compatibility of
strategies with the emerging world energy order. Energy security issues
for major industrialized nations are changing, and it is no longer merely a
question of securing adequate supplies of energy to fuel an ever-growing
manufacturing base; major industrialized nations are focusing more on
becoming major energy exporters of conventional fossil fuels. Gaylord
and Hancock indicated that commercial actors depend on reliable energy
and are thus hesitant to invest in countries where security of supply is
questionable. They focused on energy issues and related strategies of
particular relevance to the developing world, which tend to emphasize
increasing electricity access for the larger population and long-term eco-
nomic development for the state. These primary concerns, along with
limited financial and military resources for energy security, shape the
strategies of developing countries. State strategies at the national level
tend to focus on large infrastructure projects while most of the off-grid

and alternative energy projects are sponsored by international agencies,

NGOs, and community-level organizations with goals and agendas that
coexist but can also be at odds with those of the national government. This
situation is specific to developing countries, where infrastructure is not
fully developed and integrated and the presence of the state throughout a
country’s territory can be uneven.
SECURITY OF DEMAND
Romanova attempts to understand the goal of demand security by exam-

ining the source of producing countries’ political objectives. She observes
that energy security is an umbrella term, linking energy, economic growth
and political power. Preoccupations of suppliers are not new, but have
grown in scope, where demand security is a more recent concept com-
pared to supply security. This represents the other side of the coin and,
together with supply security, it forms global energy security. However,
despite numerous efforts to establish mutually beneficial cooperation
between producers and consumers, energy security remains a combination
of liberal efforts to cooperate and realist attempts by both consumers and
producers to decrease dependence on each other. It has not become an
area of constructive, liberal cooperation, and producers will be increas-
ingly more vulnerable and strategies to minimize their exposure will grow
in sophistication. Bahgat offers the International Energy Forum as an
example of cooperation between producers and consumers, as a major
characteristic of energy is the mismatch between resources and demand.
Fluctuation of energy prices plays a key role in the balance of payments,
and a major theme of the energy security literature is the importance of
diversification of energy mix and energy sources. The less dependent a
country is on a single form of energy, the more secure it is. Similarly,
the more producing regions there are around the world, the better. Any
assessment of OPEC’s role in managing global oil prices would be highly
controversial, but there is an emerging consensus that stable prices at a
reasonable level would serve both the producers’ and consumers’ interests.
Belyi assesses opportunities for energy security governance in the context
of the Energy Charter Treaty. A geopolitical, state-centric approach to
energy security cannot ignore attempts at international energy govern-
ance, since growing interdependence between producing and consuming
countries, an increasing number of cross-border investments as well as
possible mismatches between transport capacity and supply obligations
lead to a demand for predictability. This demonstrates the relevance of the
ECT-based energy governance: an overarching framework for protection

of investments, including environmental ones; the Most Favoured Nation

principle in energy investment field, which could counterbalance the retali-
atory reciprocity; a realistic framework of legally binding relations involv-
ing the EU, Russia and the transit states. International energy governance
requires a certain level of acceptance by both producing and consuming
states, while at the same time, the very understanding of energy security
remains controversial.
ENERGY, ENVIRONMENT, SECURITY
Vogler and Stephan consider energy security to be more than just another
sectoral security area. This expansive re-definition, they argued, should
alert us to the significance of ‘that which is to be secured’. Energy and
climate are not only materially intertwined, but also interdependent politi-
cally. International climate governance will not progress substantially
without increased availability of practical and affordable energy tech-
nologies to enable climate-friendly economic development. Public goods
analysis suggests that the regulatory development should still lead from
climate to energy – rather than vice versa – because only this arrangement
could ensure that long-term strategic foresight prevails over short-term
pragmatism. Scheffran tests the links between energy use, climate change
and migration. In order to build a secure, equitable and sustainable
energy systems that harvests the benefits while minimizing risks and
conflicts, principles, criteria and standards for sustainable peace must be
implemented in legal norms, certification systems and monitoring proc-
esses. Mechanisms for desecuritization, mediation and conflict resolution
can support this process, including stakeholder dialogues, participatory
decision-making and arbitration. Then geographies of conflict over energy
and climate change might be transformed into landscapes of cooperation.
Caldés, Lechon and Linares review the environmental implications of a
wide range of different energy production technologies showing results for
different kinds of pollutant emissions, impacts as well as external costs cal-
culations. In terms of GHG mitigation potential, some renewable technol-
ogies seem to attain robust results, while others such as biomass derived
electricity and biofuels show a more variable range of results. Of the
latter technologies, some aspects of concern are related to the associated
indirect effects produced by a large scale deployment; when mitigation of
other impacts and pollutants are included in the picture, some renewable
technologies show higher potential than others. If policy makers want
to promote a sustainable energy system that maximizes social welfare,
environmental externalities of all energy technologies must be taken into

account. In order to do so, it is necessary to properly identify, quantify

and later internalize the external costs in the price of energy. Paskal notes
that much energy infrastructure lies in areas that are becoming increas-
ingly physically unstable due to changes in the environment. Thus there
are concerns about both older installations not being designed for new
conditions and new installations not integrating change into their plan-
ning: either of those situations could result in marked decreases in energy
output and risks to the installations themselves, in turn affecting energy
prices and global security. She suggests it may make sense to focus on
building a more decentralized energy structure, preferably based on locally
available renewables situated in secure locations. This sort of regional,
network-based system might also prove more flexible and adaptive, and
therefore more able to cope with the increasing variability and unpredict-
ability caused by environmental change. La Branche observes that climate
change is seen by most international organizations as both an amplifier
of natural risks and an obstacle to development efforts. He suggests that
climate governance is emerging as a ‘meta governance’ redefining other
issues, including energy, but the dynamics are complex, both harmonious
and conflictual. In the cases where there is a conflict between both forms
of governance, energy takes priority over climate. Thus the challenge is
total and global in the sense that it involves all human activities. In this
sense, climate change is an epiphenomenon affecting the way we think and
perceive the world as a globality.
ENERGY AND HUMAN SECURITY
Bhattacharyya presents the energy poverty debate and discusses the link
between energy poverty and health and welfare. The chapter focuses on
the developing country challenges relating to energy poverty highlighting
the gravity of the problem and its geographical coverage. The implications
of lack of access to energy for health and social welfare are linked with
Human Development and economic development indices. The chapter
suggests that the climate co-benefits of interventions could be exploited
to increase investment in energy poverty reduction. Dyer argues that on
the assumption that justice and equity must underwrite the feasibility of
any energy strategies, we need an ethical framework for energy which
includes as a central concern the lack of human security. A key aspect of
the political barriers to ethical practices is the tendency to leave every-
thing to a market economy, allowing current short-term calculations to
determine the value of energy sources. It may require some regulatory
intervention, or public and energy-consumer action to shift the balance

of interests toward sources of modern environmental concern, by iden-

tifying attitudes that constrain and support our ecological perspectives.
However, even if such approaches make renewable contributions to
energy security easier to sell politically, it remains that an ecological ethic
more directly reflects the limits we face, and renewable energy carries with
it the prospect of ethical as well as ecological sustainability. Okereke and
Yusuf argue that energy poverty is obviously a significant issue in Africa,
as elsewhere, and that the concept of low carbon development offers
plenty of prospects for Africa to grow its economy, achieve energy secu-
rity while contributing its own quota in the global effort to fight climate
change. Given the critical importance of modern energy to well-being and
to economic development in general, achieving universal energy access
should definitely be the priority of African countries. Emphasis should
be on harnessing the abundant renewable natural resources present all
across the continent. However, achieving low carbon development will
require the massive upscale of climate and clean energy finance, large scale
investment in technology and human capacity as well as radical govern-
ance reforms. The poor deserve basic energy services like everyone else;
moreover, they have made little contribution to climate change. Global
justice and equity is therefore at the heart of the debate about climate
change, energy security and climate mitigation. Lipschutz and Mulvaney
note that socio-technical systems, such as those that make possible electri-
fication of human society, have social tendencies independent of human
intention, and that differing technological paths will have different kinds
of social impacts and, by extension, effects on human well-being and
security. Even a small investment could go a long way towards supporting
renewable energy throughout the world, decreasing cost and increasing
reliability, and to ameliorating the poverty now experienced by so many.
This could also have the additional benefit of reducing greenhouse gas
emissions, mitigating some degree of future climate change, lessening
political and military pressures on declining supplies of cheap oil, and
setting the stage for global sustainability. These goals might seem utopian
to some, but there is no technological or economic reason they cannot be
achieved over the next 50 years. Technologies are political, but do not
determine what forms political practices will take. Karlsson-Vinkhuyzen
and Jollands observe that humanity is facing daunting energy-related
challenges, yet progress towards a sustainable energy system is slow. One
of the reasons for this is the entrapment of energy policymaking within
the paradigm of national security. They argue that coupling the sustain-
ability of the energy system with the human security paradigm can help to
break this impasse. However, energy has not received much attention in
human security literature, though there are clear links between energy and

the multiple dimensions of human security. Karlsson-Vinkhuyzen and

Jollands also introduce the notion of ‘deep energy security’ and an ethical
dimension to energy security, making individual humans and humanity
as a whole the relevant security holder. This chapter investigates how the
sustainability of the energy system (and by implication, human security)
can be provided, what should be provided and how much, particularly
within global governance.
CONCLUSIONS
The emergence of ‘energy security’ reflects an increased sense of urgency

around these issues at the heart of state interests and the global political
economy. Perhaps the only common ground is acceptance that we cur-
rently inhabit a global fossil fuel-based economy, and that in itself has
its problems. So far the widely shared logic has been that of neoliberal
political economy, if some highly visible failures must bring such assump-
tions into question. Capitalism may have to reinvent itself in response to
the challenge of energy security, and the risks and distributional equity
issues arising from it, since these will likely require wide and deep struc-
tural reform of high-energy societies that go beyond adjustment within
a neoliberal economic framework and question the reasoning of main-
stream neoclassical economics. What may present itself as a structural
problem also has implications for diverse forms of agency, since changes
in the behavior of citizens, civil society organizations, and reorientation
of the private sector toward a ‘green economy’ are all central to long-term
energy security, even in a governmental context. Typically, issues of justice
and equity are raised in this context to defend the interests of those who
benefit less from the petroleum economy and have even more to lose if
no preparation is made for a ‘low carbon economy’, not to mention a
‘post-petroleum economy’. Change may bring opportunities in terms of
new technologies, new social practices, and new markets, and the pos-
sibility of de-materializing economic activity, such that genuine human
opportunities and diversity of practices would be welcome and economi-
cally beneficial (if they don’t need fossil fuels and carbon sinks). Thus
energy security is linked with sustainability in the broadest sense, and
not least because even in its own terms the current energy system faces
challenges of increasing supplies or finding new resources to meet rising
demand from a growing and developing population. It is clear that ‘energy
security’ invokes a wide range of long-term security concerns, but not so
clear that all of these have been integrated as coherent strategic goals in
overall planning and policy-making. In viewing the breadth, depth and

t ransformation of energy security discourses as politically significant

developments, we are better able to appreciate the consequences for both
structures and agents.
REFERENCE
International Energy Agency (2012), ‘World Energy Outlook 2012’, http://www.world
energyoutlook.org; http://www.iea.org/media/workshops/2012/energyefficiencyfinance/
1aBirol.pdf (accessed 12 November 2012).

Index
Abanda, F. 463, 469, 470 Ake, C. 75

Abbas, M. 416 Akinbami, J.F.K. 465, 470
accountability 64, 74, 75, 87, 448, 509 Alcorta, L. 224
Aceh region 73, 74 Aleklett, K. 22
Acheson, R. 333 Algeria 41, 142, 246, 247, 251, 253,
Ackermann, T. 61 264, 469
Adejumobi, S. 81 Alhajji, A.F. 155
Adelle, C. 313 Alike, E. 84
Adger, W.N. 306, 332 Amaize, E. 83
Africa 25, 26, 72, 75–6, 213, 258, 300, Amigun, B. 470
427, 458, 510, 513 Amin, A. 218
China 28, 29, 95, 122, 220 Amin, S.M. 223
climate change 324, 325, 466–9 Andrews, A. 221
electricity 208, 428, 429, 433, 434, Angola 72, 74, 211, 220, 470
463 Anozie, A. 466, 470
energy consumption 208, 463, 464 Anthoff, D. 368
energy poverty 427, 428, 429, 431–2, ‘Arab Spring’ 29, 98–9
433–4, 438, 439–40, 449, 458, Arab-Israeli War (1973) 118, 259, 261,
462, 463–6, 499 264
climate change and 466–9 Aradau, C. 7
geopolitics 94–5, 99, 101, 102 arbitration 277, 278, 279, 280, 282,
low carbon development 462–3, 289–90
469–71, 479–80 Arctic 105, 186, 305, 307, 394, 395,
benefit of 471–6 396, 410, 512
energy security and challenges to Argentina 103, 212, 213, 214, 218
476–9 Arvizu, D. 354, 355
northern 46, 59, 99, 101, 102, 142, assessment framework, energy security
213, 324, 464, 470, 473, 499 146–7, 167–71
nuclear energy 217 methodological choices 147–9
piracy 223 stages 150, 167–9
privatization 213, 215 1: defining energy security 150,
renewable energy sources (RES) 34, 168
218–19, 225, 463, 466, 467–8, 2: vital energy systems 150–4, 168
469, 470, 473–4, 476–7, 478, 3: vulnerabilities 152, 154–7, 168
480, 499 4: selecting indicators 157–9,
smuggling 223 168–9
Sub-Saharan see separate entry 5: making sense of indicators
US AFRICOM 76 159–67, 169
see also individual countries Australia 105, 151, 277, 281, 289, 398
African Development Bank 218 coal 30, 177, 182, 184, 203
Agashe, G. 211, 212 energy strategy 174, 175–6, 177–84,
Agbemabiese, L. 458 201, 203
Agnew, J. 95 liberal democracy 22, 23, 30, 33, 34
539

Austria 59 environmental implications 358, 359,

Austvik, O.G. 253 360–361, 370–374, 379, 485
authoritarian oil or gas producers 21, ethics 445, 449, 450–452
22, 26–7, 28, 29 food prices 219
Auty, R. 22 oil demand growth patterns 270
Averill, B. 58, 59 United States 197, 310
Awerbuch, S. 153 biogas 136, 138, 141, 219, 358, 478,
Aylon, J.P. 57 490, 492, 499, 500
Ayres, R. 483 biomass 152, 169, 188, 208, 225, 337,
Azcui, M. 212 443, 450, 474, 477, 478
Azerbaijan 71, 74, 107, 277 coal and 135, 138, 358
energy poverty 426, 430–431, 438,
Bächler, G. 321 439, 440, 462, 463, 472
Badea, A. 164 environmental implications 358, 359,
Baer, P. 446 360–361, 370, 374, 379
Bahgat, G. 42, 221, 262, 265 synthetic natural gas (SNG) 137–8
Baker, M. 223 Birdsall, N. 215
Ball, D. 223 Birol, F. 489
Baltic States 54 bitumen 188, 189, 190, 191
Bambawale, M.J. 220, 224 Blamberger, C. 277, 286
Bamberger, R. 128 Blank, S. 223
Bang, G. 310 Blatz, W. 23
Bangladesh 219 Blaydes, L. 264
Baran, Z. 155 Bodro Irawan, P. 250
Barnett, J. 330, 448 Boehlert, G.W. 366
Barrett, S. 518 Boëthius, G. 247
Barton, B. 260 Bohi, D.R. 123
Bateman, S. 222 Bolivia 103, 212, 213, 214, 221
Bauer, C. 346, 347, 348 Bollen, K. 20
Baumert, K.A. 297 Boonstra, J. 28
Bayliss, K. 215 Booth, K. 11
Beijing consensus 248–9 Bordoff, J. 299
Belarus 287–8 Boro, Issac Adaka 77
Belgium 54, 59 Bossel, U. 144
Belyi, A. 273, 279, 283, 287, 288, 290 Botswana 472, 473, 474, 475, 476
Benes, J. 97 Boubakri, N. 215
Bettini, G. 330 Bowen, A. 462, 467, 469, 472, 477
Biafra 74 BP 97, 108, 262, 395, 397
bias 147–8, 168, 313 Bradbrook, A.J. 508, 521
Bielecki, J. 427 Bradshaw, M.J. 101, 301
Biermann, F. 331 Brand, Stuart 484
Bigo, D. 321 Bratt, D. 216, 217
biodiversity 219, 322, 323, 324, 335, Brauch, H.G. 297, 321
358, 360, 364, 374 Brazil 72, 102, 204, 210, 212, 213, 214,
bioenergy 219, 334–5, 358–61, 449 218, 219, 221, 224, 225, 300, 429
biofuels see separate entry Bridge, G. 151, 152
biomass see separate entry Bringezu, S. 359
biofuels 33, 101, 135, 137, 138, 153, Bromley, S. 71
218, 219, 335, 451, 463, 470, Brooks, A. 198
487 Bruce, N. 438

Index 541
Brune, N. 212 centralized vs distributed energy

Brunei 106, 129 strategies 483–503
Brzoska, M. 320, 321, 327 costs and benefits 492–9, 500–501
Buhaug, H. 325, 330 defining human security 485,
Burke, M.B. 325 486–8
Burkina Faso 472 roads not taken 489–92
Burundi 472 Chad 472
Bush, George, II 27 Chalecki, B. 394
Bush, R. 77 Chalk, P. 222, 223
Buyx, A.M. 452 Chang, F.K. 105
Buzan, B. 7, 297, 320 Chaturvedi, A. 222
Byres, E.J. 58 Chavez, Hugo 25, 27–8
Byrne, J. 11 Chawkins, S. 391
Chen, M.E. 210
Calderón, C. 208 Chen, S. 122
Cameroon 70 Cherp, A. 3, 4, 5, 146, 147, 148, 153,
Campbell, C. 21, 22 155, 222
Campbell, K.M. 321 Chester, L. 4, 40, 41, 146, 147, 202,
Canada 22, 23, 24, 174, 175, 177, 207
180–181, 188–91, 201, 203 ChevronTexaco 83, 262
climate change 324, 394, 395–6 children 438, 439, 466, 472
demand security 246 Chile 122, 213
exemption: emergency oil reserves China 21, 22, 25, 28–9, 72, 92, 155,
119 204, 210, 213, 225, 258, 299, 301
geopolitics 398–9 Africa 28, 29, 95, 122, 220
national oil companies (NOCs) 210 Caspian resources 107
oil sands 398–9 climate change 325, 395, 398, 412
options, energy 31 climate finance 478
provinces 203 climate security 304–5, 322
shale gas or oil 102, 202 ‘synergistic’ policy: energy and
carbon capture and storage (CCS) 47, 309, 311, 314
191, 198, 200, 202, 248, 271, 309, coal 126–7, 129, 311, 398, 414
337, 338, 361, 416 demand security 251
carbon lock-in 475 diversification 220
Cardwell, D. 484 East and South China Seas 105–6,
Carroll, R. 450 109
Carter, J. 151 Energy Charter Treaty (ECT) 277
Carter, N.T. 356 energy efficiency 224
Caspian 71, 72, 98, 99, 102, 106–8, 258, energy poverty 429, 439
268, 300 geopolitics 72, 92, 94–5, 102, 105–6,
Castillo, L. 221 108, 109
Catley, B. 21 hydropower 335, 387, 389, 390, 452
Cayoja, M.R. 212 investments in overseas oil assets
Central African Republic 472 151, 211, 220
Central Asia 26, 28, 94–5, 102, 106–8, land-based imports 223
221, 223, 251, 278, 279, 286 national oil companies (NOCs) 211
see also individual countries nuclear energy 217, 333
Central and Eastern Europe 45, 46, renewable energy sources (RES) 34,
92, 300 218, 219, 309
see also individual countries shale gas 100

strategic energy reserves (SERs) China 126–7, 129, 311, 398, 414
121–2, 125, 126–7, 129, 221 Colombia 25
water 398 conflict 319
Chong, A. 215 cooking in developing countries 207,
Chotichanathawewong, Q. 217, 219, 432
220, 224 development of/increase in use of
Chou En-Lai 484 412, 414, 416
Chou, Wan-Jung 415 energy governance 410, 412, 414
Chum, H. 358 environmental change 387, 392, 398
Chung, Chien-peng 223 environmental implications 346–7,
Churchill, Winston 258, 532 370, 374, 379, 416, 488, 512
Cinti, G. 143 European Union 191, 196
Ciuta, F. 4 gasification 141, 302
Clark, W.K. 56 hydrocarbon energy mix 101
climate change 5, 8, 30, 174, 204, 216, India 309, 311
218, 259, 282, 456, 488 infrastructure 387, 467, 476, 499
centralized vs distributed energy Japan 199
485, 489, 492, 495, 496, 501, 503 liquefaction 301, 398
conflict, energy and see climate miners’ strikes 154
change under conflicts source and carrier 133–4
demand security 246 strategic energy reserves (SERs) 117,
energy poverty 441, 462, 466–9 126–7, 129, 130
energy-climate governance nexus see United States 197–8, 414
separate entry Cole, B. 223
EU 47, 61, 174, 191, 203, 322, 411 Collier, J. 280
GHG emissions see separate entry Collier, P. 22, 73, 74
governance dimensions of climate Colombia 25, 213, 214, 218, 223
and energy security see separate combined heat and power 135–6, 138,
entry 139, 144, 356
human (in)security 512 combined-cycle gas turbines (CCGTs)
infrastructure, energy 386, 387, 388, 44–5, 347–8, 350
389–90, 391, 392, 393, 394–6, Comolli, V. 310
397, 467–8 compensation 280
Japan 199–201 Compston, H. 313
liberal democracy 20, 30, 33, 35 Conceição, P. 517
low carbon or clean 489 conciliation 277, 279, 314
OPEC 268, 269–70, 271 conflicts
United States 203, 298, 468 climate change 304–6, 319–20
see also low carbon development; desecuritization 339–40
renewable energy sources securitization of migration 327–32
Clinton, Bill 128 as security and conflict issue
coal 19, 71, 151, 258, 299, 409, 410, 320–327, 412–13
443, 484, 489, 501 security and conflict issues of
Africa 463, 466, 467, 476, 477 climate policies 332–9
assessment framework 152, 153, 161 cyber security/warfare 55–65
Australia 30, 177, 182, 184, 203 resource see separate entry
biomass and 135, 138, 358 constructivist approaches 6–7, 304, 447
Canada 188 Correljé, A. 4, 7
capital cost 477 corruption 75, 82, 87, 103, 479, 513
carbon capture and storage 202, 416 Costantini, V. 152

Index 543
Cramer, C. 214 governance, energy security see

Creamer, T. 452 separate entry
Crist, E. 445 instruments 250–255
Croatia 59 oil producers’ perspectives 258–61
crowding 22–3 OPEC see separate entry
curse, resource 22–3, 74, 513 political concerns 249–50
cyber security 55–65, 183, 223, 484 democracy 483, 489, 491, 492, 502, 513
cycles, energy 96–7 liberal see separate entry
Cyprus 100 participatory 413
Democratic Republic of Congo 469,
Dahl, R. 20 473
Dalby, S. 297, 307 Denholm, P. 490
Daly, H.E. 515, 516 Denmark 119, 124, 498, 501
Daly, J. 21 Detraz, N. 304
Daniel, S. 83 developing countries 101, 152, 298,
Dannenberg, A. 33 304, 322, 445, 446, 469, 477, 510
Dannreuther, R. 71, 222 carbon space 312–13
Darbouche, H. 98, 99 climate aid 306, 477–9, 480
Darby, S. 60 climate change 323, 332, 467, 468–9
Davis, J. 214 climate security 304, 311, 314
De Bruijne, M. 64 national energy strategies 206–24,
De Cara, S. 359 224–6, 476
De Changy, F. 32 oil and gas producing 75–6, 87, 271
De Fraiture, C. 360 OPEC 268, 269, 271
De Santi, G. 33 poverty, energy 425, 430, 432, 433,
de Soysa, I. 513 434, 438, 439, 441, 468
de Vries, L.J. 65 renewable energy sources (RES)
decentralization 400, 413, 453, 457 33–4, 217–20, 223, 225, 452
centralized vs distributed energy bioenergy 334–5
strategies 483–503 see also individual countries and areas
deep energy security 8, 507, 513–15, Devine-Wright, P. 498
517–22, 530 Diaz-Chavez, R. 219
Deepchand, K. 219 Dickel, R. 249
definition of energy security 40–41, Dietl, G. 221
176, 178, 180, 192, 194, 197, 201, Dillon, M. 7, 13
202, 207, 299, 448, 532 Diog, A. 462, 469, 470, 472, 478
ECT 292 direct carbon fuel cell producing CO
framework 150, 152, 154–5, 168, 142, 143
169 Dirmoser, D. 211
producers’ security 241, 299, 302 disease 207, 306, 322, 363, 364, 390,
producing, consuming and transiting 407, 438, 439, 466, 497, 512
countries 243–4, 259–60 distributed vs centralized energy
deforestation 307, 323, 335, 390, 468, strategies 483–503
472, 478, 487 costs and benefits 492–9, 500–501
Deichmann, U. 219 defining human security 485,
Delucchi, M.A. 47 486–8
demand, security of 154, 175, 201, roads not taken 489–92
239–40, 245–6, 255, 533–4 diversification 25, 64, 96, 101, 129, 175,
development of concept 240–245 190, 261, 283, 471
economic concerns 246–9 developing world 216–21

of energy sources 40, 46, 259, 261, liberal democracy 25, 30, 34
299, 309, 311, 408, 410, 412, price of oil and gas 246
414, 471 rebound effect 415, 452
and carriers 133–45 Russia 186, 187, 245
EU 27, 46, 64–5, 99, 191, 196, 300, United States 25, 197, 310
311 Egenhofer, C. 260
producers 252–3, 271 Eggoh, J.C. 478
of security concept 23 Egypt 22, 73, 100, 102, 142, 223, 469,
Djebah, O. 77 474
Djibouti 470 Ehrlich, I. 215
Do, T.M. 221 Eickhout, B. 360
Dore, J. 276 El-Badri, A.S. 246, 260
Dosch, J. 21 ElBaradei, M. 508
Douglas, Oronto 80 El-Hinnawi, E. 352
Downs, A. 20, 24, 34 El-Katiri, M. 246, 253
Downs, E.S. 121, 129 electricity 133, 183, 190, 218, 455, 456,
dual fuel appliances 137, 138 457–8, 474–5, 478, 480
Duffield, M. 75, 76 centralized vs distributed energy
Duke, S. 26 strategies see separate entry
Dupont, A. 304, 306, 308 cyber security 57, 59–65
Durakoglu, S.M. 215 developing world 206, 207, 208, 212,
213–14, 215, 216–17, 224
earthquakes 30, 32, 333, 358, 365, 389, energy carrier 134, 144, 152–3
391, 397 energy poverty 427, 428–30, 432,
East and South China Seas 105–6, 109 433, 434, 436–8, 440, 449, 462,
Eastern Europe 3, 59, 100, 109, 174, 463, 464–5
283 EU: security of supply 47–55, 57,
see also individual countries 59–65, 175, 191, 194–6, 202, 203
Easton, D. 20, 34 Japan 200
Eberhard, A. 208 Norway 185–6
Ebinger, C.K. 219, 224 privatization 213–14
Ebohon, O.J. 466 transmission lines 488, 497
ecological modernization 8 United States 198
economic growth 20, 22, 26, 34–5, 242, electrolyzers 144
270, 313, 444, 448, 503 Eleri, E. 464, 465
Africa 462, 463, 465, 466, 467, 469, Ellis, M. 224
471, 472, 475, 476 emissions trading schemes (ETSs) 30,
Ecuador 103, 220 33, 191, 314
Edwards, S. 214 Endrenyi, J. 62
efficiency, energy 175, 247, 301, 309, Energy Charter Treaty (ECT) 107,
311, 406, 414, 490, 517, 521, 529 244–5, 251, 254, 273, 274, 292, 308
Canada 190 dispute settlement 277–8, 279, 282,
China 309, 314 283, 287, 288, 289–90
developing world 209, 223–4, 225, energy governance 274–83
428, 469, 478 environmental regime 277
ECT 278, 281–2 energy efficiency 278, 281–2
EU 47, 60, 191, 310, 411 EU and Russian positions 289–91,
ICT 60 300
India 309, 314 EU-Russian controversies 283–8
Japan 199, 200 institutional setting 282–3

Index 545
investment protection 252, 277, ECT 273, 274, 275–7, 292, 308
280–281, 284–5, 292 Energy Charter Secretariat 277,
trade and transit governance 277, 282
278–9, 285–8 EU and Russian positions 289–91,
energy poverty see poverty, energy 300
energy-climate governance nexus EU-Russia controversies 283–8
402–8, 416–17 trade and transit 278–9
energy governance 410–412 energy strategy 174, 175–6, 191–6,
tensions between climate and 201, 202, 203
412–16 gas and electricity networks in see
path dependency 408–10, 411, separate entry
415–16 geopolitics 92, 94, 99, 101, 102, 104,
Engbarth, D. 32 107–8, 110, 250
Eni 83, 108, 263 Kyoto Protocol 298
environment 512, 534–5 liberal democracy 24, 26–7, 28, 29,
Canada 190, 191 31, 32–3
China 28 nuclear power 31, 32, 191
climate change see separate entry Parliament 274, 291
demand security 241, 242, 245, 259 renewables see European Union
ECT 277, 278, 281–2 under renewable energy sources
energy infrastructure and change in Russia see European Union under
386–400, 407, 467–8 Russia
implications of energy production shale gas 191
for 345–53, 379, 416, 488, 512 strategic petroleum reserves (SPRs)
methods to quantify impacts 119
366–70 taxation 248
renewable energies 219, 345–6, Turkey 31
354–66, 370–379, 411, 413, expropriation 280
485, 487, 492, 495, 501, 534–5 see also nationalization
results 370–379 ExxonMobil 83, 108, 209, 262
OPEC 268, 269–70, 271
Equatorial Guinea 70 Faas, H. 9
Erickson, W.P. 363 Fargione, J. 359
Eritrea 470 Farquharson, E. 213
Essien, U. 81 Farrell, D. 224
Estache, A. 214 Fattouh, B. 239, 241, 242, 246, 266
Estonia 55 Favennec, J.-P. 106
ethical dimensions of renewable energy Fay, M. 208, 215
443–9, 457–9 Fears, D. 494
different types of RES 449–57 Ferguson, C.D. 216
Ethiopia 469, 470, 472, 475 financial crisis (2008/2009) 100, 175,
European Union 79, 151, 155, 164, 213, 247, 253
225, 255, 302, 517, 530–531 Finnveden, G. 366, 367
Canada 190 Finon, D. 42, 287, 288
China 28, 102 Firbank, L.G. 360
climate change 47, 61, 174, 191, 203, Fischer, C. 60, 490
322, 411 Fleming, J. 338
climate security 304, 306, 412 Fletcher, S. 212
‘synergistic’ policy: energy and Florini, A. 520, 521
310–311, 313–14 Foell, W. 440

Fogarty, D. 444, 450 GEA (Global Energy Assessment) 147,

Fogarty, E. 21 148–9, 150, 151–2, 153, 154, 157,
food 306, 323, 324, 326, 327, 334, 335, 158, 160, 161, 163–4, 166–7, 170
398, 399, 487, 511, 512 GECF (Gas Exporting Countries
biofuels 450–451, 452 Forum) 100, 245, 254
foreign direct investment (FDI), Geers, K. 56
privatize to attract 212–15, 225 Geller, H. 443
Foster, V. 213 Gemenne, F. 327
Foucault, M. 330, 405 geoengineering 320, 337–9
France 33, 59, 218–19, 351, 391, 392, geopolitics 4–5, 23, 41, 92–5, 109–10,
406, 407 201, 202, 259, 264, 273–4, 283,
Frankl, P. 374 300, 308, 320
free riding 47, 312 causes of unstable ‘energy security’
Friedman, T. 103 104–9
Friedrichs, J. 5 climate change 398–9, 412
Froggatt, A. 309, 313 critical 95–6
Frydman, R. 215 definition 95
Frynas, J.G. 82, 86 demand security 250, 255
Fthenakis, V. 492 energy cycles and corresponding
fuel blending 135, 137–8, 144, 358 theoretical views 96–7
fuel cells 140, 141, 142, 143 infrastructure and environmental
fuel-switching 309 change 398–9
future scenarios, energy security in oil price: 2000s’ surge 265
147, 148–9, 150, 152, 153, 154, overview of oil 71–2, 87
157, 158, 165 retreat of globalization 101–4
strategic ellipsis 98
G8 175, 187, 203, 204, 243–4, 283, 285, unprecedented uncertainty 97–101
303, 310 Georgia 26, 27, 106
G20 104, 175, 243 geothermal energy 152, 334, 336,
G77 304, 322 356–8, 406, 410, 443, 445, 454
Gaddafi, M. 21 Africa 218, 463, 470, 478
Gambill, G. 233 Gerbens-Leenes, W. 360
García, J.C. 212 Germany 31, 33, 51, 59, 92, 258, 321–2
Gärtner, S. 358 climate change 321–2, 338
gas and electricity networks in EU climate security 304
40–41, 65, 151, 255, 278, 300, nuclear power 26, 32, 198, 203, 333,
310–311, 314 351, 392, 445
cyber security 55–65 SPRs 120
liberalised gas markets 41–7, 242, Ghana 468, 473
248, 251–2, 254, 284–5 Gheorghe, A.V. 60
network development 45–7, 52–5 GHG emissions 200, 297, 307, 312,
public funding 46, 47 319, 332, 340, 412, 416, 508, 512
security of electricity supply 47–55, carbon capture and storage see
57, 59–65, 175, 191, 194–6, 202, separate entry
203 development 467, 468–9, 471, 480
gas-fired power plants 44–5 energy poverty 441
Gasper, D. 509, 514, 518 impacts assessment 368, 370–374,
GATT (General Agreement on Tariffs 375, 376, 379
and Trade) 276, 278 migration 513
Gazprom 107, 250, 252, 287, 288 natural gas 201, 470, 489

Index 547
reduction targets 47, 191, 307, 308, renewable energy sources (RES) see
310, 311 separate entry
renewables 354, 355, 357, 359, 360, Greene, D.L. 155
362, 364–5, 411, 413, 495, 534–5 greenfield investment 186, 213, 214
DG system 503 greenhouse gases see GHG emissions
impacts assessment 370–374, 375, Gross, C. 454
376, 379 Grubb, M. 153
Ghilès, F. 246 Grueneich, D. 494
Gibson, J. 223 Guatemala 213
Gilbert, N. 451 Guinée, J.B. 366
Gillard, Julia 30 Gulf countries 99, 254
Gilpin, R. 274 see also individual countries
Giroux, J. 222, 223 Gunawardena, U.A.D. Prasanthi 453
Giuli, M. 27 Gupta Harsh, K. 389
Gjelten, T. 212 Gupta, J. 520
Gleditsch, N.P. 325 Gupta, S. 147, 154, 162, 164, 414
Gleick, P.H. 321
Global Environmental Facility (GEF) Hadfield, A. 41
477 Haftendorn, H. 6
globalization 95–6, 110, 260, 269, 312 Haggett, C. 362
retreat of 101–4 Haghighi, S.S. 278
Goldemberg, J. 216, 217 Haiti 208
Goldman, Arnold 495 Hajer, M.A. 8
Goldstein, B. 357 Hall, D. 213, 215
Goldthau, A. 4, 175, 273, 300, 521 Haller, M. 47
Goldwyn, D. 23 Hamel, M. 242, 248
Goolsbee, A. 222 Hampson, Fen Osler 11
Götz, R. 94 Hancock, K.J. 220
governance dimensions of climate and Happ, R. 278
energy security 297–8, 308–9 Hargrove, E.C. 459
climate security 303–5, 403, 412 Harper, Stephen 188
preventive 307–8, 313, 314 Harris, G. 206
reactive 305–6, 312, 313 Hayward, T. 458
dilemma 312–15 health 407, 477, 478, 486, 487, 492,
energy security 299–302 502, 510, 511, 512
pursuit of global energy security disease see separate entry
302–3 energy poverty 423, 427, 438–9, 441,
‘synergistic’ policy 309–11 463
see also energy-climate governance Heinberg, R. 21, 24, 443
nexus Heinrich, A. 41
governance, energy security 273–4, 292 Helm, D. 155
ECT: EU and Russian positions Hemmes, K. 141, 142
289–91 Herberg, M. 210, 211
ECT as grounds for 274–83 Hines, P. 222
EU-Russian controversies 283–8 Hober, K. 280
governance, global energy 3, 518–22 Höhne, N. 468
Grave, K. 51 Hoicka, C.E. 51
Greece 31 Homer-Dixon, T.F. 321
green economy 247, 537 Hoogeveen, F. 41
efficiency, energy see separate entry Hook, L. 221

Hopkin, J. 20 infrastructure and environmental

Hoyos, C. 210 change 387, 388–90, 398, 399,
Hsiang, S.M. 325 407, 467–8
Hubbert, M.K. 22, 34 Nepal 219
Hughes, L. 210, 211, 212 Norway 185–6
Hughes, R. 56 South Africa 219
Hulbert, M. 252 Thailand 219
Human Development Index (HDI) United States 198
435–8, 439
human rights 21, 35, 275, 509, 513, Ibeanu, O. 85
530 Iceland 289, 396
human security 23, 297, 305, 306, 323, ICT 57, 60–1, 457, 493
396, 535–7 Igbikiowubo, H. 84
centralized vs distributed energy IGCC (integrated gasification
strategies 483–503 combined cycle) plants 200,
defining 485, 486–8, 508–13 346–7, 358
ethical dimensions of renewable Igure, V.M. 57
energy see separate entry Ikelegbe, A. 223
migration 328, 329 illiberal and liberal democratic regimes
poverty, energy see separate entry 19–21, 23, 25, 28, 35, 530
public good: sustainable energy India 22, 204, 225, 258, 299, 301, 393,
system 507–22 478, 515
deep energy security 8, 507, climate security 304, 412
513–15, 517–22, 530 ‘synergistic’ policy: energy and
public and private goods 515–16 309, 311, 314
Hungary 124, 335 demand security 251
Huntington, S. 20 diversification 220–221
Hussain, H. 248 energy poverty 425, 426, 427, 432,
Hussein, Saddam 24 434
Hussey, H. 21 energy strategy 206, 208, 210, 211,
Huysmans, J. 7 214, 216–17, 219, 220–221, 223,
hydrogen 135, 153, 456, 457 224
MSMP energy systems 139, geopolitics 72, 92, 94, 102, 300
140–142, 143 hydropower 335, 389–90
as universal energy carrier 143–4, national oil company 211
354, 456 nuclear energy 216–17, 333, 391
hydropower 33–4, 101, 152, 218, renewable energy sources (RES) 34,
335–6, 407, 501–2 219
Africa 219, 463, 466, 467–8, 469, strategic energy reserves (SERs) 122,
473–4, 477, 478 123, 125, 221
Bolivia 212 Indonesia 73, 74, 223, 264
Brazil 221 information 43, 45, 224, 267, 301
Canada 31, 188 electricity grid 60, 61–2, 500
China 335, 387, 389, 390, 452 exchange of 254, 290
community security 513 sharing 64, 521
environmental implications 363–5, infrastructure, energy
374, 387, 487 environmental change 386–400, 407,
ethics 449, 452–3, 456 467–8
European Union 49 institutional investors 444, 450
India 214 insulation 413, 415

Index 549
insurance 7, 217, 394, 397, 399, 403 Japan 28, 32, 120, 212, 219, 223, 258,
intergenerational equity 448 259, 263, 310, 311
International Energy Agency (IEA) 97, East and South China Seas 105–6
102, 109, 151, 152, 175, 212–13, Energy Charter Treaty (ECT) 277
259, 260, 261, 302, 308, 310, 521, energy strategy 175–6, 194–5,
529–30 198–201, 202, 203
‘easy oil’ 301–2 nuclear power 32, 33, 199, 200, 202,
G8 meetings 303 203, 217, 333, 351, 353, 391,
MOSES see separate entry 397, 445, 484
strategic energy reserves (SERs) 118, renewable energy sources (RES) 33,
119, 120, 121, 123, 125, 126, 199, 200
128, 130 Jaureguy-Naudin, M. 52, 54
International Energy Forum (IEF) Jesse, J.-H. 246
104, 241, 242, 243, 244, 254, 262, Jewell, J. 146, 147, 158
302 Jiang, J. 211
International Energy Programme Johansson, T.B. 147
(IEP) 119 Jordan 73, 214
international oil companies (IOCs) 70, Jowit, J. 392
71, 87, 98, 103, 104, 108–9, 501 justice 454, 458, 468, 480, 537
1973 Arab-Israeli War 264 distributional 448, 451
Niger Delta 76, 78, 79, 80, 81, 82,
83, 84, 86 Kalicki, J. 25
OPEC 261, 262–3, 264, 265, 266, 267 Kalitsi, E.A. 469, 474
Seven Sisters 262–3 Kanagawa, M. 463
International Renewable Energy Kanninen, T. 13
Agency (IRENA) 253, 521 Kanter, J. 392
internationalisation of public policy Kaplan, R. 223
76 Karl, T.L. 74
Internet 57, 63, 64, 502, 513 Karlsson-Vinkhuyzen, S.I. 303, 514,
investment cycle: raw materials 96, 104 515, 516, 517, 518, 519, 520, 521
Iran 25, 72, 98, 99, 128, 246, 250, 277, Kaul, I. 515, 516
301, 333, 515 Kazakhstan 22, 103, 107, 211, 220, 277
OPEC 263, 264 Keating, M. 4–5
Iraq 22, 24, 70, 72, 73, 74, 87, 92, 97, Keith, D. 305
108–9, 121, 262, 333 Kendell, J.M. 154
hydropower 335 Kennedy, A. 211
OPEC 263, 264 Kennedy, Robert, Jr 498
smuggling 222–3 Kenya 122, 218, 221, 326, 464, 468, 470
Isihak, S. 439 Keohane, R.O. 110, 273
Israel 29, 100, 118, 259, 261, 264 Keppler, J.H. 5, 155
Italy 59, 124, 142, 333 Kessler, G. 333
Ivory Coast 473 Khennas, S. 462, 464, 474
Kikeri, S. 214
Jacobson, M.Z. 334, 494 Kimmins, J.P. 444–5
Jaffe, A.M. 220, 222 King, I. 29
Jäger, J. 328, 508 Klare, M.T. 7, 24, 70, 73, 82, 94–5,
Jakobeit, C. 329–30 105, 106, 107, 155
Janardhanan, N. 220 Klawitter, J. 336
Jansen, J.C. 153 Knorr, W. 30
Janssen, R. 218 Koch, W. 34

Koike, M. 21 LNG (liquefied natural gas) 45, 46,

Kojima, M. 221 200, 220, 243, 246, 247, 252, 254,
Koknar, A.M. 222 300
Köller, J. 363 Australia 177–82, 183
Komiss, W. 222 European Union 196, 198, 252
Konoplyanik, A. 279, 286, 290 geopolitics 99, 100, 102
Korea Gas corporation 108 strategic gas reserves (SGRs) 123–4
Kotzian, P. 20 terminals 45, 46, 187, 198, 201–2
Krause, K. 6 United States 198, 202
Krauss, C. 394 Loftis, J. 212
Kumar, A. 365 long-term contracts: natural gas 43–4,
Kundu, G.K. 215 45, 47, 100, 242, 247, 251, 529
Kurzman, C. 20 Löschel, A. 209
Kuwait 99, 262, 263, 264 Lovelock, James 445
Kuzemko, C. 273 Lovins, A.B. 483, 485, 489, 492, 502
low carbon development 462–3,
La Porta, R. 215 469–71, 479–80
L’Abbate, A. 60 benefit of 471–6
Laborde, D. 359, 374 energy security and challenges to
Ladenburg, J. 362 476–9
LaMonica, M. 62 Luciani, G. 128, 251
Latin America 25, 103, 206, 208, 210, Ludlow, M. 30
211, 212, 213, 217, 218, 300, 335, Luft, G. 41, 223
464, 468 Lujala, P. 73
see also individual countries Lukszo, Z. 222
Le Billion, P. 71–2, 73
Le Coq, C. 41, 42, 147, 152, 163 Ma, W. 123
least developed countries (LDCs) 432 Maas, A. 337
Lebanon 73, 100 Mabey, N. 306, 308, 314
Leboeuf, A. 413 Mabro, R. 266
Lechón, Y. 355 Macalister, T. 210
Lecointe, C. 374 McDonald, A. 217
Lenton, T.M. 324, 489 McDonald, M. 327
Lesage, D. 299, 300, 302, 303, 520, 521 McDonald, N.C. 355, 492
Lesotho 474 Macfarlane, A.M. 444
Letzing, J. 127 MacFarquhar, N. 304
Leung, G.C.K. 220 McGregor, R. 484
Lewis, A. 365, 366 MacKay, D. 498
Lewis, Ian 211 McSherry, B. 21
Lewis, Joanna I. 304–5 McSweeney, B. 23
Li, M. 28 Madagascar 470
liberal democracy 19–20, 34–5, 530 Madan, T. 211
external dimension 20–29 Maestas, A. 335
internal dimension 29–34 Malawi 472
Libya 120, 128–9, 223, 469 Malaysia 106, 129, 211, 223, 429
linearization 34–5 Mali 472
Liotta, P.H. 509 Manson, K. 219
Lipschutz, R.D. 23, 485, 487 Marcel, V. 211
Lipson, H.F. 63 market economy 5, 43, 458–9, 529
Lloyd-Roberts, S. 83 Markulec, M. 63

Index 551
Marnay, C. 490 Moyo, D. 109

Marques, A.C. 310 Mozambique 470, 473–4
Masera, M. 64 Muller, G. 393
Mattlin, M. 26 Müller-Kraenner, S. 299, 300
Maugeri, L. 97 multi-fuel appliances 137
Mauritania 470 multisource multiproduct (MSMP)
Mazo, J. 306, 307 energy systems 138–43, 144, 145
Meadowcroft, J. 409 Mulugetta, Y. 469
mediation 29, 279, 287, 340, 534 Munck, G. 20
Medvedev, Dmitry 244, 251, 252, 254 Münckler, H. 34
Megginson, W. 215 Munro, K. 58, 63
Mehlum, H. 22 Muradov, N.Z. 143
Melillo, J.M. 359 Myanmar 208, 220, 429
Mendonca, M. 455, 459 Myers, N. 328
Menichetti, E. 370 Myrli, S. 55
meta-governance see energy-climate
governance nexus NAFTA (North American Free Trade
Methmann, C. 321, 330 Agreement) 190
Mexico 24, 25, 129, 190, 210, 214, 217, Namibia 473, 474, 475
310 Nappert, S. 289
MFN principle 280, 284, 292 Narula, K. 492
Middle East 24, 26, 29, 121, 122, 213, national energy strategies
220, 258, 263, 425–6 developing world 206–24, 224–6, 476
climate change 324 major industrialized countries
geopolitics 71, 72, 96, 99–100, 101, 174–6, 203–4
102, 283 current energy mix and import
see also individual countries dependence 176–7
migration and climate change 320, 323, explaining differences 201–3
326, 327–32, 513 features of 177–201
Miller, A. 250 national sovereignty over resources
Miller, D. 391 281, 290
Minteer, B.A. 458 nationalism, resource 94, 103, 265,
Mishra, D.K. 390 274, 284, 291, 292, 301
Mishra, P. 395 nationalization 103, 104, 210–212, 225,
Misra, A. 221 264, 299, 512, 515
Mitee, Ledum 79, 80 NATO 4
Mitrova, T. 278, 288 natural gas 31, 41, 144, 258, 278, 284,
Mitterrand, Francois 262 299, 309, 410, 501
Mo, J. 223 Africa 463, 466, 469–70, 473
Mobjörk, M. 304, 307 assessment framework, energy
Modi, V. 520 security 151, 152, 153, 154
Mommer, B. 103 cyber attacks 56–9
Monagas, Y. 210 demand security 241–3, 244, 245,
morality 447, 522 246
Moran, D. 4 elements of 246–50
Morath, E. 393 instruments 250, 251–2, 253, 254
Morocco 59, 473 environmental implications of
MOSES 146, 148–9, 150, 151, 152, 153, energy production 347–9, 370,
157, 158, 159, 161, 162, 163–4, 374, 379
165–6, 170 fracking 489, 492

fuel blending 135, 136 Niger 472, 474

gas and electricity networks in EU Nigeria 22, 25, 70, 72, 220, 464, 466,
see separate entry 469, 470, 473, 475
geopolitics 92, 93, 94, 96, 98, 99–101, Biafra 74
102, 104, 105, 106–8, 300 Niger Delta 71, 72, 74, 76–86, 87,
hydrocarbon energy mix 101 393, 487, 512
liberalised gas markets in EU 41–7, OPEC 264
242, 248, 251–2, 254, 284–5 smuggling 222–3
liquefied see LNG spending on power sector 476
long-term contracts (LTCs) 43–4, Nilsson, M. 508
45, 47, 100, 242, 247, 251, 529 Noble, D.F. 493
MSMP systems 141–3 Noël, P. 41
national energy strategies non-discrimination 276, 279, 280, 281,
Australia 177, 183, 184 285, 286, 290, 291
Canada 188 non-governmental organizations
developing world 210, 213, 214, (NGOs) 23, 75, 226, 329, 336, 467,
220 476, 499, 533
European Union 191, 196 North, D. 109
Japan 199, 200–201 North Sea 101, 184, 189, 265, 394
Norway 176, 184, 203 Norway 22, 41, 46, 75, 100, 119, 242,
Russia 187–8, 201–2, 243 245, 254, 394
United States 197–8, 203 ECT 277, 281, 289
off-shore/coastal production 392–4 energy strategy 174, 175, 176,
prices 44–5, 100–101, 125, 246–7, 178–81, 184–6, 201, 203, 204
250, 251, 280, 466, 484 nuclear power 152, 169, 202–3, 204,
resource conflicts 100 247, 320, 410, 414, 463, 484, 492,
energy security and 72–6, 87 502, 512
shale gas 93, 100, 110, 175, 187, 188, Canada 31, 203
189, 191, 198, 202, 300–301, climate risks and 333–4, 489
302, 412 developing world 216–17, 333
source and carrier 133–4 environmental implications of
strategic gas reserves (SGRs) 117, energy production 351–3, 370,
123–6, 130 374, 379, 488
Superwind 136, 141–2 ethics 445, 449, 456–7
synthetic (SNG) 137–8 European Union 31, 32, 191
transit conflicts and ECT 287–8 France 33, 351, 391, 392, 407
Nayak, D.R. 362 Germany 26, 32, 198, 203, 333, 351,
needs, energy 207–8, 415–16, 424, 427 392, 445
Nellis, J. 215 IAEA 217, 333, 489, 521
neoliberal approaches 4–5, 13, 76, 95, infrastructure and environmental
103, 108, 110, 529, 530, 531–2, 537 change 387, 391–2, 398, 407
Nepal 219, 389 Japan 32, 33, 199, 200, 202, 203,
Netherlands 22, 59, 134, 144, 275, 393, 217, 333, 351, 353, 391, 397,
408 445, 484
network development liberal democracy 19, 20, 26, 31–2,
electricity supply in EU 52–5 33, 35
liberalised gas market in EU 45–7 MSMP systems 143
Newman, E. 487 Russia 186, 290
Newman, S. 21 United States 197–8, 203, 353, 391,
Niez, A. 208 483, 488

Index 553
waste 32, 217, 333, 351, 352, 353, developing world 210, 211, 212,
374, 456, 488 213, 214, 220, 221–3, 225–6
weapons 333–4, 512 European Union 194
Nussbaumer, P. 426 Japan 199
Nussbaumer, T. 361 Norway 176, 184–5, 203
Nye, J.S., Jr 3 Russia 203, 243
United States see below
Obama, Barack 105 off-shore/coastal production 392–4
Obayuwana, O. 83, 84 peak 22, 96, 97, 266, 302, 402,
Occidental 108, 263 409–10, 448
ocean acidification 306 pipeline explosions 488
ocean energy 188, 218, 336, 365–6, 397, prices 3, 72, 73, 74, 76, 81, 83, 87, 96,
455, 516 101–4, 109, 110
Oduniyi, M. 83 1973–1974 oil embargo 118, 259,
OECD countries 96, 98, 103, 104, 308, 261, 264
322, 468 2000s: demand-driven surge 265
SERs 119–20, 123–4, 128, 130 Africa 466, 468, 471–2, 473, 474,
Oels, A. 327, 330 475
O’Hara, S. 71 Asian markets 252
oil 21, 133, 258, 278, 284, 309, 398, broken pipeline 395
416, 463, 466, 501 Canada 189–90
assessment framework, energy development 242
security 151, 152, 153, 154, 155, economic cycles 281
161, 162, 166–7 energy efficiency 411
British Navy: switch from coal to formula 265
151, 258 GDP 472
China: investments in overseas oil high status of energy security 320
assets 151, 211 hurricanes 393
cold climate infrastructure 394–6 market psychology 267
community security 513 mid-1980s 265
curse, resource 22–3, 74 non-conventional oils 301, 302
cyber attacks on SCADA systems OPEC 261, 262–8, 269, 271–2
58 SERs 117, 118–19, 120, 121, 122,
demand security 239, 240–241, 242, 123, 127, 128, 130
245, 246 Seven Sisters 262–3
elements of 246–50 stability 241, 246, 262, 263, 271–2
instruments 250, 252, 253, 254 storage and idle capacity 250
embargos 79, 118, 152, 155, 221, upstream investments 280
259, 261, 264, 299 vicious circle 239
environmental implications of producers’ perspectives 258–61
energy production 349–50, 370, OPEC see separate entry
374, 379 resource conflicts see separate entry
geopolitics 71–2, 87, 92, 94, 96–9, source and carrier 133–4
101–4, 105, 106–10, 398–9 strategic petroleum reserves (SPRs)
growth in demand 310 117–23, 128, 129–30, 221–2,
hydrocarbon energy mix 101 225–6, 259
Icelandic ash cloud 396 United States 21, 22, 23, 24–5, 94,
national energy strategies 102, 108–9, 197, 198, 301
Australia 177, 182, 183, 184 Canada 188–9, 398–9
Canada 31, 188–90, 203 Carter doctrine 151

conflicts 70, 71, 72, 73, 76, 79, Parker, D. 215

87, 92 Pascual, C. 41
domestic production 197, 310 Patel, A. 390
economic prosperity 263 path dependency 408–10, 411, 415–16
mid-1980s: low prices 265 Paust, J. 29, 155
national oil companies (NOCs) peak oil 22, 96, 97, 266, 302, 402,
210 409–10, 448
off-shore production 393 Peelen, W.H.A. 142
oil embargo 118, 259, 261, 264 Pemberton, M. 395
SPRs 120, 128, 130 Perez, Carlos 262
Trans-Alaska pipeline 394–5 Perlin, J. 499
unconventional 197 permafrost 394–6
Ojakorotu, V. 81 Peru 213, 220, 221
Okafor, E. 465 Peters, S. 24, 72, 508, 512
Okereke, C. 467, 468, 471, 479 Philippines 105, 106, 122, 123, 214,
Okoro, O.I. 464, 465, 470 221, 429
Oldag, A. 104 Piebalgs, A. 312
Oliveira, D. 223 Pierson, P. 408
Oliver, C. 125 pig-cycles 96, 104
Olivier, L. 417 piracy 222, 223
O’Loughlin, J. 325 Pirani, S. 288
Omoweh, D. 77 Plecash, C. 190
Onosode, G. 85 Podobnik, B. 512
Onuoha, F. 223 Poland 124, 214
OPEC (Organization of Petroleum Polsky, D. 438
Exporting Countries) 3, 98, 119, Ponseti, M. 335
189, 240, 242, 245, 246, 254–5, Popvici, V. 100
261–7, 299, 302 Portugal 59, 124
Energy Charter Treaty (ECT) 281 poverty, energy 175, 207, 208, 209,
long-term strategy 270–272 441, 449, 458, 462, 463–6, 508
objectives and perspectives 267–70 climate change and 441, 462,
Orbán, A. 41 466–9
O’Rourke, D. 223 concept 423–6
Osaghae, E.E. 78, 86 decentralized renewables 499, 502
OSCE 243, 249 energy security linkage and 427
Oseni, M. 464 incidence of 428–35
Oswald-Spring, Ú. 332 options for remedial interventions
Ouedraogo, N. 467 439–41
Owen, N.A. 301, 472 subsidies 301, 439
Owen, T. 509 welfare issues and 435–9
Praiwan, Y. 122
Pachauri, S. 219, 423–4, 426 Prange-Gsthol, H. 291
Page, S.E. 359 precautionary approach 7, 340
Paik, I. 119, 121 Preiss, P. 368
Pakistan 220, 277, 306 prices 258, 259, 260, 301, 303, 311, 312,
Palacios, L. 214 313, 399, 468
Palazuelos, E. 105 food 452, 468
Palestinian Authorities 100 low carbon development 471
Papua New Guinea 129 natural gas 44–5, 100–101, 125,
Parfomak, P. 223 246–7, 250, 251, 280, 466, 484

Index 555
oil see prices under oil European Union 31, 32–3, 47–55,
rebound effect 415, 452 61, 62, 65, 191, 196, 203, 310,
privatization 210, 212–15, 225, 284, 411, 413
515 direct carbon fuel cell 142
Profant, T. 93 transport 137, 451
prosumers 49, 411, 413 geopolitics 101, 105, 320
Przeworski, A. 20 geothermal energy see separate entry
public goods 47, 250, 312, 315, 339 hydropower see separate entry
storage and idle capacity 250 infrastructure and environmental
strategic energy reserves (SERs) 118 change 397, 400
sustainable energy system 507–22 Japan 33, 199, 200
deep energy security 8, 507, land use conflicts 334–7
513–15, 517–22, 530 Norway 186
public and private goods 515–16 producers of oil and gas 252–3
Putin, Vladimir 27–8, 243, 255 social un/acceptability 413–14, 415
solar energy see separate entry
Qatar 22, 75, 98, 99, 102, 252, 264 taxation 248
al-Quaida 57, 87 uncompetitive options 467
United States 197, 413, 450, 451,
Radetzki, M. 301 455, 494–9
Rahman, A. 321 wind power see separate entry
Raphael, S. 73, 76 Republic of Benin 474
Rasmussen, M.V. 7 research agenda 169–70, 226
Ratner, M. 41 resilience perspective 156, 157
Ravindranath, N.H. 359 resource conflicts 70–76, 86–7, 92, 93,
raw materials investment cycle 96, 104 100, 155, 324, 412, 512, 513
Rayner, S. 339 Niger Delta 71, 72, 74, 76–86, 87
rebound effect 415, 452 resource curse 22–3, 74, 513
Redford, Alison 190 resource nationalism 94, 103, 265, 274,
Reed, T. 58 284, 291, 292, 301
refugees 73, 306, 324, 328, 329–31 Reuveny, R. 328, 330
renationalization/nationalization 103, Riahi, K. 147
104, 210–12, 225, 264, 299, 512, Rickels, W. 337, 339
515 Rigobón, R. 210, 212
renewable energy sources (RES) 31, Ripley, C. 215
143, 144, 169, 188, 189, 309, 313, risks 4, 260, 271, 319–20, 323, 486,
397 491–2, 501
biofuels see separate entry assessment framework 154–69
biomass see separate entry meta-risk 404–5, 407–8
centralized and decentralized power risk assessment 397–8
production 486, 489–503 see also diversification
costs 32–4, 54 Roberts, J. 99
demand security 247, 248, 249 robustness perspective 155–7
developing world 33–4, 217–20, 223, Rockefeller, J.D. 71
225 Rogers, P. 306, 308
environmental implications 219, Romania 214, 217
345–6, 354–66, 370–379, 411, Rosenberg, D. 223
413, 485, 487, 492, 495, 501, Ross, M. 22–3, 73, 74
534–5 Rothschild, E. 6
ethical dimensions of 443–59 Rowell, A. 78, 79, 80

Roxas, F. 215 Saudi Arabia 21, 22, 29, 99, 250, 253,
Rubin, J. 301 301, 393
Rudd, Kevin 30 Energy Charter Treaty (ECT) 277
Russia 3, 7, 22, 25, 27–8, 45, 72, 155, OPEC 263, 264–5
258, 268 Savonis, M.J. 391
China 211, 220 SCADA systems 56–9, 62, 64
climate change 304, 322, 324, 394, Scafetta, N. 30
395, 398 Scandinavia 247
demand security 243–6, 247, 248, see also individual countries
249–50, 251–2, 253, 254, 292 Scheepers, M. 162, 164
Energy Charter Treaty (ECT) 107, Scheer, H. 443
244–5, 251, 252, 254, 273, 274, Scheffran, J. 320, 321, 324, 325, 326,
276–7, 292 329, 330, 332, 334, 335, 337
break-down of Soviet Union Schienke, E.W. 458
278–9 Schlesinger, J. 20
conciliation 279 Schultz, C.L. 3
Energy Charter Secretariat 277, Schwartz, P. 304, 412
282 Scott, S.V. 304
EU and Russian positions 289–91, Seliverstov, S. 274
300 Sen, A. 487
EU-Russian controversies 283–8 Senegal 306
energy strategy 174, 175–6, 177, Sennes, R. 212
180–181, 186–8, 201–2, 203, Shadrina, E. 187
252, 253 Sharma, A. 206
European Union 26, 27, 28, 41, 46, Shaw, T. 57, 58
92, 94, 99, 106–8, 273, 274 Shea, J. 445
demand security 248, 250, 251–2, Shehadi, K.S. 214
254, 255 Sheives, K. 223
Energy Charter Treaty see above Sheldon, F. 223
geopolitics 72, 92, 94, 98, 99, 100, Shell 78–80, 82, 83–4, 85, 86, 108, 223,
106–8, 109, 300, 398 262, 394
infrastructure and environmental Shirmohammadi, D. 490
change 394, 395, 398 Shrader-Frechette, K.S. 456
nuclear power 186, 290 Shtilkind, T. 244, 251, 252, 254
privatization 214 Shukman, D. 396
resource nationalism 103 Shultz, J. 74
strategic petroleum reserves (SPRs) Sieg, L. 32
122, 129 Silvestre, B. 215
see also Soviet Union Simmons, M. 99
Ruus, K. 56 Simpson, T.W. 360
Rwanda 122, 221, 472, 474, 476, Sinai, J. 222
478–9 Singapore 105, 129–30, 223, 393
Ryu, D.H. 57 Singer, C. 319
Slovakia 335
Sachs, J.D. 22, 214, 444 small-island developing states (SIDS)
Sahagun, L. 497 304, 322
Sala, O.E. 360 Smil, V. 11, 485, 510
Sanchez, T. 467 Smith, Ben 72
Saro Wiwa, Ken 78–9, 80 smuggling 222–3
Sathaye, J. 410 Sokolov, Y.A. 217

Index 557
Sokona, Y. 462, 467, 470, 477 Steiner, A. 520, 521

Solana, Javier 305 Stern, N. 389
solar energy 33, 34, 49–51, 52, 60, 61, Stevens, P. 210
65, 143, 145, 225, 336, 410 Stiglitz, J.E. 73, 516
Africa 219, 253, 463, 470, 472, 477 Stirling, A. 153, 154, 220
Bangladesh 219 Stokes, D. 25, 108
Canada 188 Strait, A.L. 117
capital cost 477 strategic energy reserves (SERs) 117,
centralized vs DG system 483–4, 130
486, 490, 491, 492, 494–7, coal 117, 126–7, 130
498–9, 500, 501, 502 controversies around release of 120,
China 218 127–9
environmental implications 354–6, countries not holding 129–30
370, 374, 379, 485, 487 gas: SGRs 117, 123–4, 125–6, 130
ethics 447, 449, 455–6, 457 history and evolution of 118–19
India 219, 309 petroleum: SPRs 117–23, 128,
infrastructure and environmental 129–30, 221–2, 225–6, 259
change 397 rationale for and operation of
MSMP systems 138, 141–3 117–18
non-rival 516 strategic protection reserves (SPRs)
Russia 186 23–4
social acceptability 415 Styles, G. 128
United States 198, 202 Sub-Saharan Africa 75–6, 329, 462,
solar radiation management (SRM) 470
337, 338 energy poverty 428, 429, 431–2,
Sonatrach 253 433–4, 438, 439–40, 449, 463,
Sorenson, H.C. 365 464–5, 466
Sorrell, S. 415 national energy strategies 206, 208,
South Africa 72, 211, 217, 219, 467, 213, 215, 218, 219
470, 473, 474, 475–6 see also individual countries
South America 101, 329 subsidiarity principle 46, 500, 519
see also individual countries Sudan 29, 73, 211, 220
South Sudan 73–4 Superwind 136, 140–142
Sovacool, B.K. 11, 147, 150, 209, 427, supply chains 134–6, 144–5, 260, 287,
438 447, 448
sovereignty over resources 281, 290 supply, security of 531–3
sovereignty perspective 155, 156, 157, assessment framework, energy
529 security see separate entry
Soviet Union 265 diversification of energy sources and
former (FSU) 276, 277, 278, 287, carriers 133–45
288 electricity supply in EU 47–55
Soyinka, W. 78, 79–80 liberalised gas markets in EU 44–5,
Spain 59, 124, 333, 392, 473 46
Spero, J. 70, 73 national energy strategies see
stakeholders 64–5, 147–8, 149 separate entry
Stanculescu, A. 216 Niger Delta 79
Standard Oil 71, 262 SERs see strategic energy reserves
Statoil 108 timescales 136, 137, 143
Stefanini, A. 59 sustainable energy system as public
Steinberg, F. 210 good 507–22

Swart, R. 321 Turner, F. 484

Swaziland 474 Turton, H. 152
Sweden 155
Switzerland 32, 286, 333 Udo de Haes, H.A. 367
Syed, A. 33 Uganda 122, 129, 221, 464, 470, 472
Syria 73, 211, 223 Ukraine 41, 45, 92, 106, 244, 278, 279,
285, 287–8, 290, 300, 310, 311
Taiwan 31, 32, 106, 122 Ullman, R. 485
Tandon, S. 311 uncertainty 24, 30, 54, 96, 157, 302,
Tanzania 129, 464, 470, 474 388, 488
Tänzler, D. 332 business: legal 253
Tavits, M. 19 climate change 5, 307, 309, 323, 330,
taxes 32, 33, 189, 191, 212, 219, 221, 368, 393, 408
226, 241, 471, 500 energy system: unprecedented
import duties and 248, 249, 268–9, 97–101
270 liberalised gas markets in EU 43, 44
Yukos case 289 OPEC: long-term strategy 270–1
Taylor, I. 21 UNESCO 445, 452, 458
Taylor, J. 129 United Arab Emirates 22, 75, 99, 264
Tebekaemi, T. 77 United Kingdom 22, 27, 119, 121, 155,
technology transfer 271, 314, 334 184, 242, 322, 392, 396
terrorism 59, 120, 222, 223, 260, 297, climate security 304
306, 329, 339 energy poverty 424
Thailand 122, 211, 217, 429 energy strategy 151
Thakkar, H. 390 Navy: from coal to oil 151, 258
Thavasi, V. 220 nuclear power 391
Thomson, E. 126 United Nations 75, 243, 303, 310, 509,
tidal power 188, 218, 336, 365–6, 397, 520–521
455, 516 Charter 277
Tilman, D. 359, 360 Development Program 207, 225,
Togo 473 403, 411, 412, 413, 508–9
Tol, R. 325, 368 Environment Program 218, 311,
Toon, O.B. 334 404
Tordo, S. 210, 211 Framework Convention on Climate
transparency 167, 201, 202, 242, 244, Change 268, 298, 303, 304, 307,
255, 268, 290, 300, 302 309, 339
G8 175 Human Rights Commission 79
liberalised gas markets in EU 45 Kyoto Protocol 268, 298, 313, 518
SERs 121, 123 Millennium Development Goals
Treat, R. 57 207, 403, 466, 509, 522
Trebing, H.M. 215 Security Council 282, 304, 309, 322
tri-generation systems 136, 138, 139, United States 105, 121, 212, 218, 225,
140–2, 144 241, 258, 324, 414, 468, 487
Trombetta, M.J. 8, 24, 72, 321 China 28, 94
Trudeau, N. 224 climate security 304, 403, 412
Trudeau, Pierre Elliot 189 ‘synergistic’ policy: energy and
Tuathail, G.Ó. 95 309–10, 311, 313–14
Tunisia 211 DG system 491
Turkey 31, 100, 107, 214, 335 Energy Charter Treaty (ECT) 276,
Turkmenistan 22, 28, 98, 107, 279 290, 291

Index 559
energy strategy 25, 174, 175–6, Waltz, K. 273

192–3, 196–8, 201, 202, 203 Wanneau, K. 403
Federal Energy Regulators Warner, K. 327
Commission (FERC) 198 Washington consensus 249
geopolitics 23, 71, 72, 92, 94–5, 102, waste 339, 347, 349, 350, 457, 488
105–6, 107, 108–9, 398–9 computing technologies 486
infrastructure and environmental nuclear 32, 217, 333, 351, 352, 353,
change 386–7, 393, 396, 397, 374, 456, 488
398–9 renewables 152, 219–20, 225, 357–8,
Kyoto Protocol 298 359, 360, 361, 365, 485
liberal democracy 21, 22, 23, 24–5, water 306, 323, 324, 327, 363, 386, 398,
27, 28, 29, 34 404, 407, 412
monopsonistic power 188–9 biofuels 449, 451
nuclear power 197–8, 203, 353, 391, biomass 360, 361
483, 488 desalination 354
oil see United States under oil DG system 492
al-Quaida 57, 87 geopolitics 398–9
renewable energy sources (RES) 197, geothermal energy 357
413, 450, 451, 455, 494–9 hydropower see separate entry
resource conflicts 70, 71, 72, 73, 76, nuclear energy 351, 352, 391–2,
79, 87, 92, 105–6, 155 407
Russia 27, 94 ocean acidification 306
shale gas 93, 100, 110, 175, 198, 202, ocean energy 188, 218, 336, 365–6,
300–301 397, 455, 516
shale oil 102, 110 off-shore/coastal production 392–4
strategic energy reserves (SERs) 120, pollution 339, 347, 348–9, 350, 351,
124, 128, 130 357, 360, 361, 493, 500
Upadhyaya, H. 390 solar energy 356
USSR 58, 103 uncompetitive options 467
Uzbekistan 28 Watson 219
Watts, M.J. 73, 78
Valdes, C. 218 Wei, Y.M. 221
Van de Graaf, T. 244, 521 Weitzman, M.L. 308
Van der Linde, C. 249, 252 Wertheim, P. 212
van der Vleuten, E. 59, 64 West, J. Robinson 29
van Vliet, M.T.H. 392 Westphal, K. 3, 100, 107
Vaughan-Williams, N. 6 White, G. 82
Vazquez, I. 214 Wicks, M. 155
Venezuela 25, 27–8, 58, 103, 211, 212, Widen, J. 51
214, 220, 263, 277, 301 Willems, A.R. 284
Victor, D.G. 175 Williams, A. 33
Vietnam 106, 122, 221, 429 Williams, J. 21
Vivoda, V. 210, 211 Williams, N. 499
Voser, P. 175 Williams, R.I. 57
Willrich, M. 240
Waelde, T. 273, 277, 281, 289 wind power 33, 49–51, 52, 60, 61, 101,
Wæver, O. 7, 23, 24, 320 143, 145, 219, 225, 336, 410, 516
Wahab, B. 223 Africa 219, 470, 477
Wake, H. 350 Canada 188
Walt, S. 6 capital cost 477

centralized vs DG system 490, 492, Xie, J. 219

494, 497–8, 500, 501, 502 Xu, Y. 207, 219
China 218
environmental implications 361–3, Yafimava, K. 273, 279, 288
485 Yan, P. 121
ethics 449, 453–4, 456, 457 Yar’Adua, President 80
India 219 Yemen 122, 223
infrastructure and environmental Yépez-García, R. 208
change 397 Yergin, D. 96, 118, 120, 151, 155, 222,
MSMP systems 136, 138, 140–2 260, 319
Norway 186 Yi, L. 51
Russia 186 Youngs, R. 21, 24, 26, 29, 35, 300
social un/acceptability 313, 413, 415, Yu, T. 126
454–5, 497–8 Yu, W. 222
South Africa 219 Yueh, L. 303
Thailand 219
Winner, L. 483, 491 Zambia 122, 129, 221, 470, 473,
Winzer, C. 13, 40, 147, 150, 154, 209 476
Wiser, R. 362, 363 Zangger, C. 32
Wolde-Rufael, Y. 470 Zanoyan, V. 260
Wolman, D. 395 Zhang, D.D. 325
women 427, 438, 439, 466, 472, 511 Zhang, Y. 215
Wood, S. 26, 31, 32 Zhang, Z. 151
World Bank 85, 218, 218–19, 225, 403, Zhou, W. 220
408–9, 412, 465, 468, 475, 480 Zimbabwe 473
coal fired power plant 467, 476 Zimmermann, H. 26
Wright, S. 329, 330 Zissis, C. 212
WTO 251 Zoll, R. 336
Wüstenhagen, R. 454 Zweibel, K. 494


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INTERNATIONAL HANDBOOK OF

Hugh Dyer and Maria Julia Trombetta - 9781781007891

Maria Julia Trombetta

Hugh Dyer and Maria Julia Trombetta - 9781781007891

All rights reserved. No part of this publication may be reproduced, stored

Edward Elgar Publishing, Inc.

A catalogue record for this book

Library of Congress Control Number: 2013932959

This book is available electronically in the ElgarOnline.com

ISBN 978 1 78100 789 1

Typeset by Servis Filmsetting Ltd, Stockport, Cheshire

Hugh Dyer and Maria Julia Trombetta - 9781781007891

List of figures viii

1 The concept of energy security: broadening, deepening,

PART II ENERGY SECURITY ISSUES

2 Energy security and liberal democracy: ideals, imperatives

PART III SECURITY OF ENERGY SUPPLY

6 Securing energy supply: strategic reserves 117

Hugh Dyer and Maria Julia Trombetta - 9781781007891

9 National energy strategies of major industrialized countries 174

PART IV SECURITY OF ENERGY DEMAND

11 Energy demand: security for suppliers? 239

PART V ENERGY, THE ENVIRONMENT AND

14 Governance dimensions of climate and energy security 297

PART VI ENERGY AND HUMAN SECURITY

19 Energy poverty: access, health and welfare 423

Hugh Dyer and Maria Julia Trombetta - 9781781007891

22 The road not taken, round II: centralized vs. distributed

PART VII CONCLUSIONS

24 The political economy of energy security 529

Hugh Dyer and Maria Julia Trombetta - 9781781007891

3.1 Generation adequacy assessment from ENTSO-­E SO-­AF

Hugh Dyer and Maria Julia Trombetta - 9781781007891

16.7 External costs of electricity generation technologies

Hugh Dyer and Maria Julia Trombetta - 9781781007891

Hugh Dyer and Maria Julia Trombetta - 9781781007891

Joshua Olaniyi Alabi, University of Leeds, UK

Hugh Dyer and Maria Julia Trombetta - 9781781007891

Chukwumerije Okereke, University of Reading, UK

Hugh Dyer and Maria Julia Trombetta - 9781781007891

Hugh Dyer and Maria Julia Trombetta - 9781781007891

Hugh Dyer and Maria Julia Trombetta - 9781781007891

Hugh Dyer and Maria Julia Trombetta - 9781781007891

Energy is fundamental for the working of modern societies and that

Hugh Dyer and Maria Julia Trombetta - 9781781007891

Hugh Dyer and Maria Julia Trombetta - 9781781007891

as security, and how to provide it. In providing a review of the relevant

Hugh Dyer and Maria Julia Trombetta - 9781781007891

process. Threats are not objective entities waiting to be discovered and

Hugh Dyer and Maria Julia Trombetta - 9781781007891

resilience (Trombetta 2010). In this way exploring the peculiarities of the

Hugh Dyer and Maria Julia Trombetta - 9781781007891

The remaining parts explore how existing discourses are broadening,

Hugh Dyer and Maria Julia Trombetta - 9781781007891

harmful to both developed and developing economies. Cherp and Jewel

Hugh Dyer and Maria Julia Trombetta - 9781781007891

energy debate, contemporary energy systems are responsible for a variety

Hugh Dyer and Maria Julia Trombetta - 9781781007891

represents a paramount challenge with implications for energy security

List of figures viii

1 The concept of energy security: broadening, deepening,

2 Energy security and liberal democracy: ideals, imperatives

6 Securing energy supply: strategic reserves 117

9 National energy strategies of major industrialized countries 174

11 Energy demand: security for suppliers? 239

PART V ENERGY, THE ENVIRONMENT AND

14 Governance dimensions of climate and energy security 297

19 Energy poverty: access, health and welfare 423

22 The road not taken, round II: centralized vs. distributed

24 The political economy of energy security 529

3.1 Generation adequacy assessment from ENTSO-E SO-AF

16.7 External costs of electricity generation technologies

non-governmental organisations monitor the functioning, quality or

mitigate financial-economic and political-geostrategic concerns, but it

This exemplifies disjunction of normative preferences and material-

According to Giuli (2011: 2), altering EU-Russia interdependence ‘would

Contemporary Russia is characterised by authoritarian-nationalist rule:

The Euratom treaty of 1957 foresaw an EEC-wide nuclear energy industry.

gas, oil, and diamonds’, at http://www.dailymail.co.uk/news/article-464921/Putins-Arctic-

2 CHALLENGES ARISING FROM LIBERALISED