HE WHO PAYS THE PIPER?

Almost quietly, almost unnoticed and certainly unheralded at least in this part of Western Europe the Nord Stream gas pipeline has come on-line which enables Russia to ship commercial natural gas supplies to Western and Central Europe. The gas pipeline, currently one of the world's longest submerged pipelines has not been without controversy. The pipeline project, which was actively pushed by the Russian government and agreed to by Gerhard Schröder's government of Germany. The project has not been without a degree of controversy for a number of reasons, especially the fact that it increasing European energy dependence on Russia.

Gazprom, nominally an independent energy company but in fact the energy arm of the Kremlin, has a bit a reputation for generously spreading it's largess around to help get what it wants. Some dubious activities may have taken place in Sweden and in Germany to smooth the path for the Nord Stream pipeline. Certainly it is a fact that Schröder, by coincidence after leaving the post of Chancellor of Germany, ended up as head the shareholders' committee of Nord Stream AG.

There is another factor that has set some alarm bells sounding and that’s because the new pipeline may enable Russia to bypass traditional transit countries Ukraine, Slovakia, Czech Republic, Belarus and Poland. Some transit countries are very concerned that a long-term plan of the Kremlin is to attempt to exert political influence on them by threatening their gas supply without affecting supplies to Western Europe.

In recent years there have been several seasonal and very bitter public Russian and Ukrainian gas disputes. Now with Nord Stream there is a real fear that France and Germany may sell the Eastern European countries down the river in exchange for cheap Gas. These fears have been strengthened by the fact that Russia has consistently refused to ratify the Energy Charter Treaty (ECT).

The ECT is an old international agreement which should provide a transparent framework for energy trade, transit and investments. The ECT process was originally based on plans to integrating the energy sectors of the then Soviet Union and Eastern Europe just after the end of the Cold War into a much broader European and world energy market.

Nord Stream’s critics have said that Europe could become dangerously over dependent on Russian natural gas supplies, especially if Russia faces a surge in both domestic and a foreign demand for gas. A Swedish Defence Research Agency study noted over 55 incidents since 1991, with "both political and economic underpinnings".

Back in April 2006 Radosław Sikorski, who was then Poland's defence minister, made reference to the project in terms of the 1939 Nazi-Soviet Molotov–Ribbentrop Pact. More recently Edward Lucas in his updated (2009) book The New Cold War: Putin's Russia and the Threat to the West, (which is well worth a read) has suggested that "though Nord Stream's backers insist that the project is business pure and simple, this would be easier to believe if it were more transparent."

The involvement of Gazprom in the project – a company that's as great a believer in transparency as its masters in the Kremlin - does not help matters and neither does the fact that Nord Stream AG is incorporated in Switzerland where it can take full advantage of effective banking anonymity. Russia's response has been that the pipeline actually increases Europe's energy security, and that any criticism is caused by bitterness about the loss of significant transit revenues, and political influence. Diplomatically that's as close to ‘Bite me!’ as you can get.

So there we are Russia is quietly supplying a significant portion gas supplies to Western Europe – how soon before we end up hostage to a Russian political agendas. Be silent and get your gas or criticize us over Human rights or when we attack a small country or chill in the leak midwinter! I have no yearning for a new cold war, but harsh realities, but the writing may be on the wall when it comes to energy security.

Relying on energy supplies that are at risk of interruption or are found in unstable regions of the world is just plain stupidity, as is consciously choosing to become more increasingly dependent on imported gas. If you think that the members of the big six give customers a hard time just wait until one or two of them get bought by Gazprom no doubt ably assisted by the city based friends of New Labour and the Conservatives, ever eager to chase a quick profit at our expense.

Here in Wales, a small country on the fringe of Europe, we had better take note and hope that we can rapidly make our small country energy independent. We need to develop a flexible self-sufficient energy development strategy that encourages decentralised micro generation schemes and by actually implementing it this could create jobs, useful skills and help to bootstrap the economy out of the developing recession as well as helping consumers. The peoples of these islands need to be entirely self sufficient via renewable non nuclear non market driven energy resources and quickly.