Publication Laka-library:
A partnership of unequals. Electricity exports from the eastern neighbourhood and Western Balkans

AuthorI.Holovko, O.Miskun, D.Chipashvili, P.Gallop
6-04-0-30-25.pdf
DateJune 2012
Classification 6.04.0.30/25 (INTERNATIONAL ORGANISATIONS - LIBERALISATION)
Front

From the publication:

A partnership of unequals
Electricity exports from the eastern neighbourhood
and Western Balkans
June 2012

Research and writing:
Iryna Holovko, National Ecological Centre of Ukraine, Ukraine
Olena Miskun, National Ecological Centre of Ukraine, Ukraine
Dato Chipashvili, Green Alternative, Georgia
Pippa Gallop, CEE Bankwatch Network

Executive summary
Cooperation in the energy sector is one of the European Union’s key 
priorities in its relationships with neighbouring states. Although 
the strategic documents and polices suggest that the promotion of 
energy efficiency, energy savings and the use of renewable energy 
sources should be the primary areas of cooperation along with “energy 
security”1, it is the latter that receives the lion’s share of attention 
from the EU side. In several cases “energy security” also receives a 
disproportionally large amount of financial support both directly from 
the European Commission, through the Neighbourhood Investment Facility 
(NIF) and from the international financial institutions (IFIs), namely 
the European Bank for Reconstruction and Development (EBRD) and the 
European Investment Bank (EIB).
The EU’s ambitious target to cut its greenhouse gas emissions by 80-95 
percent in 20502 requires significant efforts as a major shift in thinking 
is needed to ensure a rapid transition away from modes of living based on 
constantly increasing energy consumption. The apparently easier path to 
“solve” this problem involves securing more energy imports in order to 
cover the gap between demand and internal production. Securing increased 
electricity imports from neighbourhood countries has already received a 
great deal of EU attention in the Western Balkans, Ukraine and Georgia.
An analysis of EBRD investments in the Ukrainian energy sector shows that 
export-oriented infrastructure projects accounted for roughly 61.6 percent 
of the bank’s total lending to the power and energy sector between 2006 and 
20113. During this period the EBRD financed two high-voltage transmission 
lines in Ukraine, forming different parts of an ambitious plan for the 
“second backbone” transmission corridor running from the east to the west 
of the country, up to Ukraine’s borders with the EU. Currently the EBRD 
is considering a EUR 300 million loan (with a further EUR 300 to 500 million 
accompanying loan expected from Euratom) for the upgrading of old Soviet 
type nuclear reactors so as to achieve “current standards in nuclear safety 
[that] should lift the nuclear safety related embargo and allow Ukraine 
greater flexibility to trade with the EU”.4 In reality this means lifetime 
extension of old nuclear units and creation of a physical connection with 
the EU to transmit electricity generated by them. As a side effect this 
would lead to an increase of coal generated electricity as the gap in 
domestic consumption would be covered by it. 
This in turn would lead to doubling of CO2.