Europe’s Energy Chief Urges Deepwater, Shale Drilling

Günther Oettinger says Europe suffers from a competitive advantage because it is more risk-averse than America.

Europe suffers from a competitive disadvantage because it is reluctant to fully exploit its energy resources, said the European Commissioner for Energy Günther Oettinger last week.

Oettinger, a German, told EurActiv that Europe faces “three disadvantages” in competing with the United States: a higher degree of dependence on foreign gas and oil imports as well as higher energy prices.

“In the US, there’s a process to reindustrialize the country first by oil,” said Oettinger. He would like to see industry’s share of gross domestic product increase again in Europe as well. Since 2000, it has fallen from 22 to 18 percent.

The European Union is pledged to increase the share of renewables in national energy supplies to 20 percent by 2020 when carbon dioxide emissions are supposed to be cut by an equivalent rate.

Largely because of higher taxes on gasoline and oil, energy rates in industrial regions like the north of Italy are twice as high as in the United States. The divergence, according to Oettinger, shows that there is a clear need for an “energy price strategy to avoid an ongoing process of deindustrializing Europe.”

American advances in energy independence are largely thanks to drilling in deepwater and shale. Many European nations sun similar initiatives. Poland and the United Kingdom are incorporating shale in their national energy strategies but Bulgaria and France have banned fracking which opponents believe causes earthquakes and contaminates water supplies.

“We are not really active in looking at which risks and options we would have with shale gas,” said the energy commissioner. The arguments against fracking largely stem from ill informed concerns which experience with the technology and research in the United States could lay to rest.

Countries in the European Union currently import 36 percent of their gas from Russia which also accounts for 31 percent of European oil imports.

According to Oettinger, the Americans are less risk averse than Europeans. “They accept some risks with offshore drilling for ‘own sources’ in the Gulf of Mexico and they accept sand oils and others,” he said. By contrast, “we import oil and have high taxation.”