Energy Security and the Environment in Eastern Europe: The Case Study of Ukraine

For Belarus, Moldova and Ukraine, energy security has become a top priority because of their acute vulnerabilities. These states consume far more energy relative to the size of their economies than Western European countries because of the relatively large size of the industrial sector in their economies and energy inefficiencies in all sectors. Large quantities of natural gas and oil are imported from or through the Russian Federation to fuel this demand and to compensate for insufficient domestic energy supplies. These countries lack a diversity of energy suppliers and have been subject to gas supply interruptions and sharp price increases, allegedly to advance Russia's economic and political interests. In response to these risks, Belarus, Moldova and Ukraine are attempting to enhance their energy security with a variety of policies and programs. It is critical for these countries to devise energy policies from a comprehensive perspective, including the likely environmental impacts of any proposed energy policy. With a broad policy perspective, governments can determine the best way to achieve their energy security goals without undermining other policy objectives. It is especially important that governments be cognizant that the negative environmental impacts of their energy policies may themselves create security challenges. Ukraine has recently responded to its energy insecurities with new policies, most notably its "Energy Strategy Until 2030". Drafted and adopted in 2006 in the wake of gas supply interruptions and steep price hikes, the Strategy focuses on how Ukraine can meet a growing energy demand while reducing gas imports. The Strategy calls for a dramatic expansion of nuclear and coal power, but neglects to answer how these strategies are better than the alternatives. The environmental and social consequences of the Strategy have yet to be adequately analysed and the Strategy raises difficult questions for both Ukraine and its neighbours.