The Russian invasion of Ukraine and ongoing responses by the global community have prompted renewed scrutiny of glaring energy and resource security gaps in the post-Cold War era. War, of course, is not new, nor is Russia's aggression a unique threat to global energy security or decarbonization. However, as a nuclear-armed and energy export-intensive state engaged in an unprovoked attack on a neighboring country, Russia's actions do pose novel challenges to national energy, security, and climate priorities.
Russia is the world’s third-largest producer of oil and the second-largest producer of natural gas. Much of Europe and parts of Asia remain crucially dependent on Russian oil“Russia Exports Most of Its Crude Oil Production, Mainly to Europe,” Today in Energy, U.S. Energy Information Administration, November 14, 2017, https://www.eia.gov/todayinenergy/detail.php?id=33732. and especially natural gasVladimir Kutcherov et al., “Russian Natural Gas Exports: An Analysis of Challenges and Opportunities,” Energy Strategy Reviews 30 (July 1, 2020): 100511, https://doi.org/10.1016/j.esr.2020.100511. resources. This coincides with the wealthy world’s reliance on commodities and value-added trade—everything from solar-grade polysiliconP. Frischknecht et al., , Life Cycle Inventories and Life Cycle Assessment of
Photovoltaic Systems, International Energy Agency PVPS Task 12, Report T12-19, 2020. to lithium-ion batteries“China Dominates the Lithium-Ion Battery Supply Chain, but Europe Is on the Rise,” September 16, 2020, BloombergNEF, https://about.bnef.com/blog/china-dominates-the-lithium-ion-battery-supply-chain-but-europe-is-on-the-rise/.—from authoritarian China. Climate and energy policies in OECD nations that increased the West’s long-term dependence on natural gas and let nuclear generation stagnate and decline have exacerbated these problems while stalling progress on climate goals. As the United States, Germany, and Belgium have continued to shutter domestic nuclear power plants, some countries have become ever more interlinked with authoritarian resource flows—in particular, Russian natural gas interests. Meanwhile, wealthy nations have increasingly withdrawn from investing in fossil energy,Vijaya Ramachandran, “Rich Countries’ Climate Policies Are Colonialism in Green,” Foreign Policy, November 3, 2021, https://foreignpolicy.com/2021/11/03/cop26-climate-colonialism-africa-norway-world-bank-oil-gas/. hydro, and nuclear energy projects in low- and middle-income countries,W. Gyude Moore, “Nuclear Energy Is Climate Justice,” June 30, 2020, The Breakthrough Institute, https://thebreakthrough.org/issues/energy/nuclear-justice. a void that Russia and China are rushing in to fill.
Mitigating or reversing these dynamics will require new energy policy commitments from the United States, the European Union, and beyond. These commitments should include diversifying global natural gas production and trade; halting the shutdown of operating nuclear power plants; restarting nuclear power plants in recoverable stages of decommissioning; reforming nuclear innovation and licensing and deploying next-generation nuclear reactors around the world; reinvesting in diverse energy and resource mining and production; and accelerating decarbonization through domestic investments in innovation and low-carbon infrastructure and energy technology deployment.
If the recommendations in our report are followed, we estimate that up to 45 percent of Russia’s roughly 200 billion cubic meters (bcm) of gas exports to Europe could be offset in the next year or so. Sustaining recent increases in liquified natural gas (LNG) imports, fully utilizing existing pipeline imports of non-Russian gas, and maximizing nuclear generation on the continent stand out as near-term options for reducing reliance on Russia. We estimate that European imports of non-Russian natural gas could increase by as much as 80 bcm over 2021 levels within the year. Preventing the premature shutdown of European nuclear reactors could prevent 12 bcm of increased demand for Russian natural gas, while restarting temporarily offline reactors could reduce demand by a further 4 bcm. Lastly, new renewable energy generation as well as electrification and energy efficiency could reduce gas demand by 7 bcm.
Summary of Recommendations
Diversifying the Global Natural Gas Supply
- Short-term reorganization of international gas trade
- Sustain planned redirection of international LNG trade to Europe
- Reallocate available floating storage and regasification units (FSRUs)
- Reduce gas demand by continuing near-term deployment of renewables, electrification, and energy efficiency
- Forward-looking expansion of LNG and pipeline infrastructure
- Build new LNG import and export terminals
- Revive and complete the Midi-Catalonia pipeline project
- Expand gas storage capacity and increase storage levels in existing capacity
- Repeal or significantly amend the Jones Act
- Lifting of restrictions on energy development in low- and middle-income countries
- Reverse multilateral development bank policy against oil and gas projects in sub-Saharan African nations and beyond
- Support new and expanded Africa-Europe gas pipeline infrastructure
Keeping Nuclear Power Online
Sustain the operating fleet of power reactors and safely recommission closed nuclear power plants
Prioritize scheduled maintenance for temporarily offline nuclear reactors and promptly restart operations
Achieving a Global Nuclear Renaissance
Establish clear pathways to certifying, licensing, and deploying new light-water, small modular reactors, and non-light-water reactor technologies
Achieve fundamental regulatory reforms and establish a licensing framework that provides predictable, timely, and appropriate levels of safety review relative to the actual, observable risk from radiation
Take bold steps to export US nuclear technology and establish domestic production capacity sufficient to replace Russia as the main supplier of High Assay, Low Enriched Uranium (HALEU) fuel, the fuel of choice for US reactor developers
Accelerating Low-Carbon Innovation and Infrastructure Deployment
Improve and expand US federal clean energy RD&D
Invest in enabling infrastructure including electrification, electricity storage, and high-voltage transmission lines
Radically reform US environmental regulatory law, including the National Environmental Protection Act, the Endangered Species Act, and the Jones Act, to accelerate clean infrastructure deployment
Diversifying Natural Gas Supply
The prelude to and outbreak of Russia’s war in Ukraine have sharply highlighted the potential co-benefits of both a long-term European transition away from Russian gas and, more broadly, a more diversified global supply of gas.
At the same time, insufficient national capabilities, lack of investment, and poorly placed policy restrictions from the wealthy world have inhibited lower-income countries’ abilities to build out their own energy infrastructure, including the supply and use of natural gas. This further strengthens Russia’s competitive advantage on the global stage while limiting poor countries’ economic and social development.
A more diversified energy landscape with more clean energy sources like solar, wind, nuclear, hydroelectricity, and geothermal power alongside energy storage and alternative fuels insulates societies from disruptions in fossil hydrocarbon supplies. Increased energy security, in turn, provides valuable geopolitical benefits. Policy makers around the world are now exploring measures to reduce or eliminate their countries’ consumption of exported Russian natural gas as a means of applying further pressure on the Putin government.Christoph Steitz et al., “Nuclear, Coal, LNG: ‘No Taboos’ in Germany’s Energy About-Face,” February 27, 2022, Reuters, https://www.reuters.com/business/energy/germany-step-up-plans-cut-dependence-russia-gas-2022-02-27/.
While European planners are undoubtedly scrambling to prepare for a worst-case scenario of a total gas cutoff, there is no question that Europe cannot successfully decouple itself from Russian gas overnight. Improvised measures, no matter how well designed, would not prevent widespread hardship that could place many Europeans at the mercy of cold weather and sendhock waves throughout Europe’s economies. Even a somewhat more controlled three-year, five-year, or eight-year plan for a largely Russian-gas-free continent would not be immune from similar disruptions and impacts.
Such insecurity makes it clear that many countries’ economies are probably going to remain at least partially reliant on natural gas over the next two decades at a minimum. Looking well beyond the current repercussions of war in Ukraine, it is similarly probable that natural gas will continue to see widespread use across much of the world, from Africa to Asia, for some time. As such, efforts to decrease reliance on Russian oil and gas will have to include not only measures that reduce gas demand with technology alternatives, but also measures that replace current Russian imported gas with gas sourced elsewhere.
Short-term reorganization of international gas trade
It will be prohibitively difficult to replace Russian gas with clean energy and energy-efficiency solutions alone, yet it would be similarly challenging to replace European imports from Russia with gas sourced from the rest of the world. In the last couple of years, Europe has consumed between 450 and 550 bcm of gas annually, of which approximately 400 bcm is imported, with 165 to 200 bcm per year sourced via Russian pipelines.Simon Flowers, “The Domino Effect of the Ukraine Crisis on Gas and LNG,” February 7, 2022, Wood Mackenzie, https://www.woodmac.com/news/the-edge/the-domino-effect-of-the-ukraine-crisis-on-gas-and-lng/. A more detailed breakdown of 2020 European gas pipeline imports with country-level data is shown in the figure below.
Most recently, Russian pipeline gas export data from January 2022 indicates a precipitous drop in flows to only 7.1 bcm. This drop represents a roughly 40 percent decline from historical European pipeline imports of Russian gas.Stuart Elliott, “Russian Gas Flows into Europe Plunge in January Amid Ukraine Tensions,” February 2, 2022, S&P Global Commodity Insights,
https://www.spglobal.com/commodity-insights/en/market-insights/latest-news/natural-gas/020222-russian-gas-flows-into-europe-plunge-in-january-amid-ukraine-tensions. Europe's gas import landscape is already changing rapidly.
New gas pipelines to Europe and new import-export facilities for LNG will require years to plan and build, so such infrastructure can only begin to affect the gas supply picture in the medium term. In the immediate weeks and months following Russia’s invasion of Ukraine, the only rapid measures for funneling more gas to Europe rely upon shuffling the global LNG trade itself.
Sustain planned redirection of international LNG trade to Europe
Global LNG trade is fundamentally constrained in the short to medium term. There is neither sufficient room in the 490 bcm per year world LNG market,“Global Gas Review 2020: Gas Market Report, Q2-2021, Analysis,” International Energy Agency, accessed March 3, 2022, https://www.iea.org/reports/gas-market-report-q2-2021/global-gas-review-2020. nor sufficient unused LNG import capacity to offset the annual 165 to 200 bcm of European gas demand currently supplied with Russian imports. Nevertheless, global policy makers should continue to track opportunities to negotiate for additional LNG shipments to Europe over both the short and medium term. Planners should understand that such reshuffling of LNG shipments provides only an incremental benefit as opposed to a large-scale solution. The International Energy Agency (IEA) has estimated that such measures could offset as much as 60 bcm and at least around 20 bcm, considering global LNG financial markets, of Russian pipeline imports.“A 10-Point Plan to Reduce the European Union’s Reliance on Russian Natural Gas: Analysis,” International Energy Agency, accessed March 4, 2022, https://www.iea.org/reports/a-10-point-plan-to-reduce-the-european-unions-reliance-on-russian-natural-gas. LNG import data from January 2022 show a significant increase, totaling roughly 16 bcm—near maximum import capacity excluding LNG terminals in the Iberian Peninsula, which are mostly disconnected from the rest of Europe.Jamison Cocklin, “European LNG Imports Hit Record in January: The Offtake,” Natural Gas Intelligence, February 3, 2022,
https://www.naturalgasintel.com/european-lng-imports-hit-record-in-january-the-offtake/. In principle, if such import levels are sustained or even drop slightly, annual European LNG imports outside of Spain and Portugal could increase by more than 60 bcm and as much as 80 bcm compared to 2021 imports.
Reallocate available floating storage and regasification units (FSRUs)
Expanding Europe’s capacity to import LNG by relocating a number of FSRUs would greatly bolster optimistic estimates for sustained increases in near-term LNG imports. FSRUs are large specialized ships or barges capable of receiving LNG shipments, converting the fuel back into the gas phase, and introducing the gas into onshore pipeline and distribution networks. Large FSRUs can potentially handle up to 3-4 bcm of gas in a year.Milda Seputyte, “Lithuania Grabs LNG in Effort to Curb Russian Dominance,” October 27, 2014, Bloomberg News, https://web.archive.org/web/20141027171638/http://www.businessweek.com/news/2014-10-27/lithuania-grabs-lng-in-effort-to-curb-russian-dominance. However, difficulties may limit the potential to station more of the global FSRU fleet in Europe, including long contract terms for existing FSRUs, the need for specialized mooring infrastructure, and the constraints of the current global FSRU fleet. It is therefore unlikely that more than a handful of units could be relocated, potentially increasing European LNG import capacity by around 12 bcm of gas per year. In particular, Excelerate Energy’s Express FSRU vessel is currently operating as an LNG tanker, despite its regasification capabilities. The Excelerate Express has 150,900 cubic meters of LNG storage capacity and 15.6 million cubic meters per day of LNG regasification capacity.Brian Songhurst, The Outlook for Floating Storage and Regasification Units (FSRUs),” Oxford Institute for Energy Studies, July 2017,
https://a9w7k6q9.stackpathcdn.com/wpcms/wp-content/uploads/2017/07/The-Outlook-for-Floating-Storage-and-Regasification-Units-FSRUs-NG-123.pdf. According to Marine Traffic’s maritime vessel tracker, at the time of this writing, the ship is docked in Dubai.“EXPRESS LNG Tanker,” Marine Traffic, accessed March 7, 2022,
https://www.marinetraffic.com/en/ais/details/ships/shipid:117791/mmsi:205526000/imo:9361445/vessel:EXPRESS. Repositioning the vessel at a European port to increase LNG import capacity should be made a high priority in the near term.
Continue near-term deployment of renewables, electrification, and energy efficiency
In addition to directing global LNG supplies to Europe, reducing overall demand for natural gas will help defray Russian gas imports. In the near term, new and additional renewable energy projects slated to come online in Europe within a year or so are expected to generate 35 terawatt-hours (TWh) of clean energy. The IEA projects this will reduce demand for gas by roughly 6 bcm per year. Our calculations, factoring in an average natural gas power plant efficiency of 49 percent,“Efficiency of Conventional Thermal Electricity and Heat Production in Europe,” European Environmental Agency, accessed March 7, 2022,
https://www.eea.europa.eu/data-and-maps/indicators/efficiency-of-conventional-thermal-electricity-generation-4/assessment-2. indicate that the IEA implicitly assumes roughly 90 percent of this additional renewable generation will displace gas demand, which is fairly uncertain. Based on a more conservative 75 percent assumption, reduction in gas demand from new renewables would be around 5 bcm.
Electrification and energy efficiency can also reduce gas demand. The IEA projects that a doubling of heat pump deployment, near doubling of building retrofits, tripling of smart thermostat installation, and other ancillary initiatives could result in a 4 bcm reduction in European gas demand. A one degree Celsius reduction in average building temperatures could yield an additional 10 bcm reduction. Importantly, demand-side reduction may prove to be less efficacious than expected as evidenced by nominally similar European gas demand over the past few years, despite sharp increases in 2021 gas prices.“Caught in the Middle: European Gas in 2022,” December 20, 2021, IHS Markit,
https://ihsmarkit.com/research-analysis/caught-in-the-middle-european-gas-in-2022.html. More modest increases in heat pump deployment and building retrofits—both potentially constrained by the available workforce—along with current trends might result in a reduction of 2 bcm of gas demand.
Forward-looking expansion of LNG and pipeline infrastructure
New gas infrastructure in Europe and in gas-producing countries abroad could expand European supply links to producers in North and West Africa, the United States, the Middle East, and elsewhere.
Gas import-export terminals and pipelines should be designed with the clean energy transition in mind, thereby maximizing their useful lifetime. In particular, new gas infrastructure investments should be designed for ease of conversion to CO2 capture, storage, and utilization applications or for the transportation and use of clean hydrogen carriers.
Build new LNG import and export terminals
Currently, Europe has roughly 250 bcm of LNG import capacity. However, a significant portion of this capacity is in the Iberian Peninsula, which is mostly disconnected from European Union(EU) gas pipelines. Historically, LNG import terminals have been significantly underutilized, sometimes running at below 50 percent utilization. In total, the EU imported roughly 114 bcm of LNG in 2020, nominally similar to 2021 LNG imports of 108 bcm. The figure below details 2020 LNG imports, national sources of imported LNG, and LNG import capacity for select European countries.
As of 2019, there were over 300 bcm of import capacity in various stages of planning and almost 50 bcm of import capacity under construction, most of which are outside the Iberian Peninsula and are expected to come online before 2026.“LNG Investment Database,” Gas Infrastructure Europe, accessed March 4, 2022,
https://www.gie.eu/transparency/databases/lng-investment-database/. New LNG terminals already in development that are expected to enter operation in the next few years include facilities in Poland and Ireland. Germany recently made clear its intentions to construct two new LNG import terminal facilities, which will likely take several years to realize. “Ukraine Crisis Forces Germany to Change Course on Energy,” DW Akademie, accessed March 2, 2022, https://www.dw.com/en/ukraine-crisis-forces-germany-to-change-course-on-energy/a-60968585.
US policy makers should prioritize expansion of LNG export terminal capacity in the United States. A Center for Strategic & International Studies analysis suggests that, to better align with European climate targets in the 2030-2035 timeframe, American LNG export projects could pursue innovative financing or contracting arrangements that would commit LNG infrastructure to transition to serve Asian customers after a period of ten or so years.Nikos Tsafos, “How U.S. LNG Could Help Europe and Climate,” Center for Strategic & International Studies, March 4, 2022, https://www.csis.org/analysis/how-us-lng-could-help-europe-and-climate. Such a strategy could encourage accelerated retirement of older, more-polluting coal infrastructure in Asia, thereby delivering climate and air pollution benefits in a region anticipated to require more time to decarbonize than Europe.
Revive and complete the Midi-Catalonia pipeline project
Gas pipelines can play a key role in bringing natural gas supplies from non-Russian sources to consumption centers across Europe. In particular, the Midi-Catalonia (MidCat) gas pipeline project would help integrate the Iberian Peninsula into the broader EU gas pipeline network. Planning for the 1,250 km pipeline began in 2007 and proposed a capacity of 7.5 bcm of gas per year, doubling Spanish-French gas pipeline capacity.“Midi-Catalonia Pipeline,” Global Energy Monitor WIKI, accessed March 3, 2022, https://www.gem.wiki/Midi-Catalonia_Pipeline. The MidCat pipeline alone would therefore potentially displace roughly 4 percent of European imports of Russian gas based on 2021 trade volumes.“10-Point Plan to Reduce.” Indeed, even before Russia’s invasion, a Spanish newspaper, La Vanguardaria, reported that NATO had plans to revive the MidCat project, with strong support from the German government.Steve Sweeney, “NATO Planning Pipeline to Supply Europe as Hostilities Toward Russia Continue,” Morning Star, February 7, 2022,
Expand gas storage capacity and increase storage levels in existing capacity
The extreme supply security risks caused by the Ukraine crisis perfectly demonstrate the value of the energy insurance provided by gas storage. European planners should immediately seek to fill at least 90 percent of working gas storage capacity by October 1 each year, in accordance with recent IEA recommendations.“10-Point Plan to Reduce.” The impact of increasing gas storage capacity will vary, but will give Europe more flexibility to take advantage of periods of higher gas availability and to leverage this supply during peak winter months.
Storage can also help increase the historically low utilization rates of LNG terminals. To meet roughly 40 percent of Europe’s annual gas demand, the full regasification capacity of around 30 of Europe’s large LNG terminals would need to be utilized, representing a huge leap from average utilization rates falling below 30 percent.“An Overview of LNG Import Terminals in Europe,” King & Spalding, accessed March 4, 2022, https://www.kslaw.com/attachments/000/006/010/original/LNG_in_Europe_2018_An_Overview_of_LNG_Import_Terminals_in_Europe.pdf?1530031152.
Repeal or significantly amend the Jones Act
The Jones Act is a 1920 Act of Congress mandating that all goods moved by ship between US ports must be transported by US-flagged vessels constructed in the United States, owned by US citizens, and operated by US crews.
The inability to transfer LNG between US ports because of these restrictions has at times forced US companies to import the LNG they need from Russia despite a vast surplus of US gas production—introducing an unnecessary and inefficient albeit small and occasional demand for Russian gas (<1 million cubic meters).“Why the U.S. Imports LNG Despite Its Gas-Export Boom,” January 3, 2019, Bloomberg, https://www.bloomberg.com/news/articles/2019-01-03/why-the-u-s-imports-lng-despite-its-gas-export-boom-quicktake. Repealing or significantly amending the Jones Act will strengthen the value and versatility of the US LNG import-export infrastructure by potentially allowing more transportation of LNG between regions of the United States. This will in turn remove the need for US consumers to ever consider importing Russian LNG and will also introduce greater flexibility into the international LNG trade, facilitating European efforts to transition away from Russian gas.
As the global clean hydrogen trade grows, the ability to ship hydrogen efficiently between US ports will provide benefits similar to the increased flexibility in intranational LNG shipments. Removal or even reduction of Jones Act restrictions will also aid other energy-related development efforts such as offshore wind development, which is currently complicated by the inability of wind turbine installation vessels, which are almost universally foreign-flagged ships, to load wind turbine components at US ports for installation off the US coasts.Colin Grabow, “The Jones Act Continues to Hamper the Development of Offshore Wind Energy,” May 19, 2021, Cato Institute, https://www.cato.org/blog/jones-act-adds-costs-complications-offshore-wind-energy.
Further ahead, there is no future under the Jones Act status quo in which US shipbuilders will be able to compete in the growing market for vessels that play important roles in the clean energy transition, such as liquified hydrogen carriers, offshore wind turbine installation vessels, or container ships that run on clean fuels.
Lifting of restrictions on energy development in low- and middle-income countries
The recently reinforced imperative to diversify the global supply of oil and natural gas is compounded by the enduring need for fossil energy development and infrastructure in low- and middle-income countries. Poor countries are least responsible for carbon emissions, most at risk from the impacts of climate change, and most in need of modern, resilient energy infrastructure.
Reverse multilateral development bank policy against oil and gas projects in sub-Saharan African nations and beyond
These climate resiliency and infrastructure development needs are stymied by restrictive financing politics at multilateral development banks (MDBs) like the US International Development Finance Corporation (DFC) and the World Bank. Revisiting these policy constraints can foster growth of the natural gas sector in regions like West and North Africa, stimulating economic development while also enabling global consumers of Russian gas to more easily secure alternative sources of supply.
The World Bank dominates the international finance landscape through its two lending platforms. The first is the International Bank for Reconstruction and Development, which offers money at market rates to richer, creditworthy, middle-income countries. Its annual commitments are on the order of $25 billion. The second World Bank unit is the International Development Association (IDA), which lends money at low rates with a long repayment period to
lower-middle-income and low-income countries. Through development credits, grants, and guarantees, IDA committed $36 billion to the world’s poorer nations for the most recent fiscal year—and on highly favorable terms.
This low-income lending unit is very important to development and poverty alleviation. Yet the World Bank and other lenders are increasingly facing calls from their shareholders—including the United States and the European Union—to retrofit practices to address climate change as well as poverty.
The World Bank has responded by announcing that it will not fund coal or upstream oil and gas projects.“World Bank Group Announcements at One Planet Summit,” December 12, 2017, World Bank, https://www.worldbank.org/en/news/press-release/2017/12/12/world-bank-group-announcements-at-one-planet-summit. Downstream gas projects (which occur between manufacture and point of sale) will be allowed only under exceptional circumstances, and the bank is busy writing rules for when such projects can go forward. The US DFC has announced a similar approach, allowing a limited number of gas projects and only for eight more years.“DFC Commits to Net Zero by 2040, Increases Climate-Focused Investments,” April 22, 2021, US International Development Finance Corporation, https://www.dfc.gov/media/press-releases/dfc-commits-net-zero-2040-increases-climate-focused-investments. Already, the European Investment Bank no longer provides financing for natural gas projects.
The gap between the priorities of leaders of many African nations, for instance, and Western donors and lenders is remarkable. Elected officials from Nigeria, Ghana, and other sub-Saharan African nations have repeatedly insisted on their countries’ right to economic self-determination and development of domestic fossil energy resources.Yemi Osinbajo, “The Divestment Delusion,” Foreign Affairs, August 31, 2021, https://www.foreignaffairs.com/articles/africa/2021-08-31/divestment-delusion.Yoweri K. Museveni, “Solar and Wind Force Poverty on Africa,” Wall Street Journal, October 24, 2021, https://www.wsj.com/articles/solar-wind-force-poverty-on-africa-climate-change-uganda-11635092219.Lazarus Chakwera, “The West Caused the Climate Crisis; It Should Now Pay to Clean Up the Mess,” The Guardian, October 31, 2021, https://www.theguardian.com/commentisfree/2021/oct/31/west-climate-crisis-cop26-africa-develop-global-heating.Yet despite continuing to rely overwhelmingly on fossil energy themselves, politicians and lenders from rich countries have placed stricter and stricter restrictions on international financing of energy infrastructure in sub-Saharan Africa and beyond.
In light of the Russian invasion, MDBs should go beyond lifting these restrictions to proactively encourage the responsible deployment of up- and downstream oil and gas production in Africa. The Biden administration in particular should remove fossil energy restrictions in DFC lending and use its shareholder leverage at other MDBs to encourage similar relief and investment.
Emissions from the world’s poorest countries—those that receive IDA loans—will remain very low for decades to come, even if their economies grow rapidly and without action to reduce emissions. Allowing them to invest in some types of fossil fuels—in particular, natural gas—will not only be beneficial to this group of countries, but also useful for global efforts to reduce natural gas imports from Russia. As emphasized throughout this report, new gas infrastructure in developing countries can be designed and sited with dual-purpose clean hydrogen or hydrogen carrier fuel uses in mind, provided that international financiers are willing to fund the additional investment required for infrastructure built to this higher standard.
Rich-country policy makers are quick to argue that their restrictions do not amount to a ban on natural gas projects but rather represent support for wind and solar. The reasoning, one imagines, is that the private sector or “donors” like China can fund gas. But this approach does not work. The fact is—and this is well known to policy makers in rich countries—no one is signing long-term infrastructure deals in low-income countries without public financing or guarantees. That is precisely why development finance banks exist. They are meant to bring down capital costs in high-need, low-credit markets. If they refuse to fund gas infrastructure, others are not likely to step up. If development banks are to do their jobs, they need to think more deeply about their stance on emissions and what it means for the world’s energy supply. A transparent and realistic approach that includes energy security for both rich and poor countries alongside efforts to address climate change must replace the thinking that is currently dominant.
Support new and expanded Africa-Europe gas pipeline infrastructure
New multilateral finance for gas infrastructure in Africa will help African countries to grow their economies and will aid Europe in diversifying their energy imports. Exporting natural gas will provide a much-needed source of foreign exchange to countries in Africa that are trying to lift themselves out of poverty. Some of the gas that comes available can also be used to provide electricity within Africa.
Currently, Europe’s main source of gas in Africa is Algeria, which provides nearly 14 bcm of LNG and just over 20 bcm of pipeline gas to Europe, primarily through Spain and Italy. Nigeria also supplies just over 14.5 bcm of LNG to the EU, more specifically to France and Spain. In addition to meeting the African continent’s own growing demand, there is significant potential for a large increase in African LNG and pipeline gas exports to EU countries stemming from large, relatively untapped reserves totaling at least some 22,000 bcm of gas—the majority of which are in Nigeria, Algeria, Senegal, Mozambique, Egypt, and Tanzania, in descending order of reservesMatthew Goosen, “Top 10 African Countries Sitting on the Most Natural Gas,” July 16, 2021, Energy Capital & Power, https://energycapitalpower.com/top-ten-african-countries-sitting-on-the-most-natural-gas/.—and due to the enthusiasm of West and sub-Saharan African national leaders. In particular, the Nigeria-Morocco Gas Pipeline and the soon-to-be-operational Greater Tortue Ahmeyim Field—which features 2,800 bcm in untapped gas reserves—present exciting opportunities for a reinvigorated Africa-Europe gas trade. However, a lack of Spanish-EU gas interconnections remains a key constraint for African gas exports to Europe because they will likely pass through Spain and Italy.
Keeping Nuclear Power Online
The domestic and international dialogue on nuclear energy has evolved over the last decade, drawing increasing support for civilian nuclear power from scientists, scholars, activists, and thought leaders. Nations like Japan, the United Kingdom, and France have in recent years recommitted to their domestic nuclear power programs and to further nuclear deployment in the future.
The Russian invasion of Ukraine has turbo-charged this evolution.
- Sustain the operating fleet of power reactors and safely recommission closed nuclear power plants
- Prioritize scheduled maintenance for temporarily offline nuclear reactors and promptly restart operations
To reduce dependence on Russian fossil energy, reconsidering premature nuclear plant closures will have the most immediate effect in Europe. Nuclear power is the largest source of low-emission electricity in the EU. In 2021, several reactors were taken offline for maintenance and safety checks. Returning these reactors to safe operations in 2022 is of vital importance. Coupled with the start of commercial operations for the completed reactor in Finland, the EU can increase its nuclear power generation by up to 20 TWh in 2022.
A temporary delay of European nuclear closures and continued safe operation of these facilities could prevent an increase of almost 12 bcm per year in EU natural gas demand. The additional 20 TWh of clean power produced via the restart of several nuclear reactors that were offline for maintenance in 2021 and the start of operations of the new reactor in Finland correspond to a further reduction of roughly 4 bcm of gas.“10-Point Plan to Reduce.” If the plant owner/operator decides to close or extend the shutdown of a reactor (as was the case in Germany), the government must consider the needs of its collective society over the economic decisions of a utility and can incentivize or subsidize safe continued operation. Lengthy relicensing processes should be waived or put on hold for reactors that are still operational. They are formalities and should not be used as a smoke screen—especially for reactors with decades of operational experience.
Through successive energy crises in Europe, Germany remained committed to shutting its nuclear plants. That may be changing. The threat of dependence on energy imports from a hostile Russia appeared to convince some German policy makers to consider reversing course. Days after Russia invaded Ukraine, the German economic minister briefly expressed openness to the idea of keeping Germany’s last three operating nuclear power plants on line. South Korea also recently pivoted towards a national energy policy more open to nuclear energy. Policy makers should encourage these reversals by other nations and support the continued operation of nuclear plants that are scheduled to be prematurely decommissioned, including those currently operating in Belgium and the United States.
Plans to prematurely close US nuclear plants should be reconsidered urgently, and actions by the Nuclear Regulatory Commission (NRC) that undermine progress toward achieving carbon emission goals—in particular, the recent NRC actions to reverse prior power reactor license renewal decisions—cannot continue.
It is time for the Biden administration to invoke its powers and establish a National Directive to not only ensure continued operation of the currently operating nuclear power plants (including the endangered Palisades and Diablo Canyon nuclear stations), but also bring recently closed plants (e.g., Indian Point Unit 3, Pilgrim, Oyster Creek, Fort Calhoun, Vermont Yankee, and others in SAFSTOR or DECON status"Decommissioning Status for Shutdown U.S. Nuclear Plants,” January 2021, Nuclear Energy Institute, https://www.nei.org/resources/statistics/decommissioning-status-for-shutdown-us-plants.) back into service.
In addition, both Federal and State policy makers should reorient policy regarding spent nuclear fuel. For decades, high-level waste has been transferred to safe, secure, and stable interim spent fuel storage canisters installed at operating and decommissioned nuclear plant sites across the country. To further bolster the nation’s systems for managing spent nuclear fuel and to encourage states with antinuclear policies to repeal them, Congress should prioritize the STRANDED Act, which provides resources for the longer-term storage and management of spent fuel.
Achieving a Global Nuclear Renaissance
To fully realize a global nuclear renaissance, radical regulatory reforms in nuclear licensing and oversight are necessary. Overwhelmingly, that demands policy change at the US NRC.
- Establish clear pathways to certifying, licensing, and deploying new light-water, small modular reactors and non-light-water reactor technologies
- Achieve fundamental regulatory reforms and establish a licensing framework that provides predictable, timely, and appropriate levels of safety review relative to the actual, observable risk from radiation
When Congress passed the Nuclear Energy Innovation and Modernization Act of 2019 and the Nuclear Energy Leadership Act of 2020, it mandated that the NRC modernize and streamline nuclear licensing and other regulatory procedures in accordance with a new generation of smaller, safer nuclear reactor technologies that rely on a variety of fuels and fuel cycles. Recent NRC actions indicate the Commission is failing to meet that mandate.
Regulation of risks associated with nuclear reactor operation should be limited to levels of exposure to radiation that would result in observable health effects in a large exposed population over a reasonable period of time. Those risks should be considered and weighed against the more significant health effects associated with alternative energy technologies that might supplant nuclear energy generation. Likewise, requirements for emergency planning, operational staffing, and security personnel should be appropriately scaled to the risk of the site-specific design. Lastly, but equally importantly, licensing decisions should be timely. A protracted, five-year review for design certification or license approval is unreasonable and would unnecessarily delay the potential for nuclear energy to provide for society’s pressing needs.
The same principles apply to environmental reviews: their scope and detail should be considered relative to the environmental impacts of other forms of energy production. Moreover, nuclear plants should be exempt from any environmental review requirements that are unrelated to the construction or operation of those reactors. This includes site-specific environmental review requirements for reactors that are largely manufactured off site and assembled on site.
- Take bold steps to export US nuclear technology and establish domestic production capacity sufficient to replace Russia as the main supplier of High Assay, Low Enriched Uranium (HALEU) fuel, which is the fuel of choice for US reactor developers
More than 30 countries are considering, planning, or starting nuclear power programs.“Emerging Nuclear Energy Countries,” updated January 2022, World Nuclear Association, https://world-nuclear.org/information-library/country-profiles/others/emerging-nuclear-energy-countries.aspx. Currently, Russia and China are leading the way to deployment of nuclear reactors; by far, most new reactor projects have been announced or are under construction in these two countries. Further, these nations are offering fully integrated build-operate-fuel packages that are very enticing to new entrants to the nuclear energy market. Attractive Russian and Chinese products and services could undermine movement away from these foreign suppliers (particularly Russian gas and nuclear exports) and threaten American energy security.
Exports of US nuclear technology to the world would restore US prominence in shaping the future of safe, clean, and reliable nuclear generation. Moreover, exporting US technology establishes a 100-year partnership between nations, presenting an opportunity for the United States to play a key role in global energy security. Some companies are trying to enter the market to supply parts or fuel for foreign-made reactors. However, long-term fuel deals that are part of the sale package for new US reactors are designed to limit the impact of this effort.
Sources of uranium are presently limited. US civilian nuclear reactor owners are dependent on an international supply chain for uranium shipments. Most, but not all, supply is sourced either domestically or from close US allies. The breakdown of such supplies by country of origin from 2016 to 2020 is shown in the figure below.
The limited supply of uranium poses an even greater challenge to deploying the first advanced reactors in the US. The fuel of choice for these reactor designs is High Assay, Low Enriched Uranium (HALEU) fuel, and the primary supplier is Russia. Unless US policymakers take bold steps to establish domestic production capacity sufficient to replace Russia as the main supplier of HALEU fuel, US reactor developers will struggle to find an immediate market for their products and services. Congress provided roughly $30 million for HALEU in the Energy Act of 2020.
While this is a vital initiative with potential long-term returns, establishing a HALEU supply chain will take years. A separate export license is required for each export, and each license is required to specify an end user. The export-licensing process is long and cumbersome compared to the Russian approach, which allows a manufacturer to export to several companies in multiple countries under one license without listing the recipients. If US developers are to establish a sustainable market for their designs and influence important design features, like nuclear energy safeguards monitoring systems, and strategic policy matters, like deciding locations of enrichment facilities, they must be able to expeditiously export their products. Some US developers are considering build-own-operate-and-return cycles that eliminate the need for entrant countries to handle fissile material. This strategy eliminates many proliferation concerns as more countries develop nuclear power programs.
Accelerating Low-Carbon Innovation and Infrastructure Deployment
- Improve and expand US federal clean energy RD&D
- Invest in enabling infrastructure including electrification, electricity storage, and high-voltage transmission lines
Policies designed to realize a global nuclear energy renaissance should be pursued alongside broader large-scale investments in low-carbon energy technology and infrastructure, including those in renewable energy, carbon removal, hydrogen and other synthetic low-carbon fuels, electrification of transportation and other end-uses, and enabling infrastructure including electricity storage and transmission. Such steps will not only remove any future need for US imports of Russian gas, but will also free up additional gas supplies for European and Asian consumers, further displacing Russian gas exports.
There are a number of measures the US government can pursue to promote clean energy innovation and deployment. Congress is currently considering a $500 billion package of low-carbon energy investments, most of which would go towards federal research, design, and development (RD&D) and extending and expanding federal tax credits for renewable energy technologies like solar and wind. Ideally, tax credits would be technology-inclusive, temporary, and targeted at nascent technologies in need of public subsidization. One option would be the so-called Energy Sector Innovation Credits (ESICs) recently proposed by Senators Crapo and Whitehouse. ESICs would provide federal subsidies for low-penetration clean energy technologies and then phase out as those technologies mature. More broadly, the 2020 book Energizing America, from the Columbia University Center on Global Energy Policy, provides a detailed breakdown and holistic framework for expanding clean energy RD&D as a guide for congressional allocation of dollars.Varun Sivaram et al., Energizing America: A Roadmap to Launch a National Energy Innovation Mission, Columbia University SIPA Center for Global Energy Policy, 2020, https://www.energypolicy.columbia.edu/sites/default/files/file-uploads/EnergizingAmerica_FINAL_DIGITAL.pdf.
As federal policy drives low-carbon technologies down commercial and technical learning curves, the obstacles to decarbonization will increasingly come from enabling infrastructure.
In 2021, Congress passed the Infrastructure Investment and Jobs Act, which included tens of billions of dollars for rebuilding and expanding the nation’s power grid, as well as federal money for electric vehicles and vehicle-charging infrastructure. This was a large step in the right direction. Federal investments in US electric transmission infrastructure should prioritize better connections between the Western and Eastern Interconnections (the two major electrical grids) and targeted funding for transmission expansion and upgrades in the Power Marketing Administrations.
- Radically reform US environmental regulatory law, including the National Environmental Protection Act, the Endangered Species Act, and the Jones Act, to accelerate clean infrastructure deployment
Finally, Congress and the White House need to proactively and radically reform the nation’s environmental regulatory laws, which at present largely work to prevent the deployment and construction of the low-carbon technologies and infrastructure the nation will need for the long-term transition from fossil fuels.
As with the NRC proposals detailed above, regulatory reform efforts should prioritize expedited technology deployment and significantly reduce the lengthy planning, siting, and review processes that impede infrastructure projects and drive up costs. Congress should start with ambitious efforts to overhaul the National Environmental Protection Act, the Endangered Species Act, and the Jones Act.
Conclusions - A Moment of Clarity for Energy Priorities
As widening anxieties around the uncertain future of flows of Russian oil, gas and uranium fuel continue to mount, clear solutions are emerging for energy-related dilemmas in Europe, the United States, and elsewhere. New gas import infrastructure in Europe like pipelines and LNG terminals was once fiercely debated if not opposed, yet the current crisis has made it clear that such projects are preferable to widespread reliance on Russian gas. Policymakers from wealthy countries have historically supported policies that restrict the ability of low and middle-income countries to secure development financing for upstream oil and gas facilities, yet the benefits of diversifying global gas supplies and promoting economic development by supporting new oil and gas production in regions like West and North Africa are becoming more apparent. The importance of clean nuclear power generation as a means of limiting gas demand is now increasingly appreciated. Finally, governments are now recognizing that overly obstructive regulatory barriers are slowing and disincentivizing the deployment of low-carbon technologies that could similarly reduce future needs for Russian fossil imports.
Particularly in advanced economies, contentious debates around the future of energy systems have often culminated in the continued tolerance of low-cost Russian oil and gas imports as a simple solution for meeting immediate needs. Today, Europe continues to pay state-linked Russian fossil energy corporations even as smoke curls over bombed buildings in Kyiv, Kharkiv, and Mariupol. World leaders are now recognizing that from a more holistic perspective—considering energy security, geopolitical impacts, economic stability, and climate progress—this temporary measure was, in reality, the least preferable course of action all along. Above all, the current moment demands decisive actions to rectify the complacency of the energy status quo to date. The measures proposed in this report represent concrete first steps towards a more responsible and secure energy future.