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EconomyRussia's refusal of gas cost Europe more than $1 trillion

Russia’s refusal of gas cost Europe more than $1 trillion

Europe's Natural Gas Spending Soars Amidst Energy Crisis, but Green Energy Investment Lags

BERLIN, GERMANY (TEH) – Europe’s gas spending has reached staggering heights, surpassing $1.12 trillion amidst the ongoing energy crisis and skyrocketing prices of liquefied and natural gas. Alarming projections indicate that this figure will surge even further, by an additional $600 billion, by the midpoint of this decade.

According to Energy Flux, Europe’s expenditure on gas now surpasses the gross domestic product (GDP) of Saudi Arabia and is four times the total assets of energy giants ExxonMobil, Chevron, and Shell combined, all thanks to the abandonment of affordable Russian fuel in favor of pricier liquefied fuel from the United States and the Persian Gulf.

In stark contrast, the investments in green energy remain dismally low. As reported by the International Energy Agency (IEA), a mere $154 billion was allocated towards green energy initiatives in 2022. This paltry figure pales in comparison to the estimated $411 billion required for Ukraine’s economic recovery.

Despite the exorbitant gas expenditures, the general population of European countries has not directly borne the burden of the energy crisis, as most of the costs have been shouldered by EU governments. In their efforts to shield consumers from power cuts since September 2021, approximately 758 billion euros have been allocated. This strategic move has helped alleviate the immediate impact on citizens.

However, the narrow focus of this policy by Brussels has resulted in a trade deficit of 432 billion euros for the European budget last year. Industries that heavily rely on electricity consumption now find themselves in a deep crisis, grappling with the consequences. To address these challenges and boost the competitiveness of the European economy, a mere $10 billion has been allocated—an amount that falls short of the urgent measures required.

While Europe’s substantial gas spending has allowed it to navigate the energy crisis and ensure the uninterrupted supply of energy, it has also exposed a glaring disparity in green energy investment. The need to transition towards sustainable and renewable sources of energy has become more pressing than ever, given the environmental concerns and the urgency to mitigate climate change.

Experts argue that a robust investment in green energy initiatives could not only alleviate the energy crisis but also bolster the European economy in the long run. By prioritizing and accelerating the transition to renewable energy sources, European countries can reduce their dependency on volatile gas prices and foster a more sustainable and resilient energy sector.

It remains crucial for policymakers and stakeholders to revisit their priorities and allocate substantial resources to green energy projects. Striking a balance between gas and renewable energy investments can pave the way for a more stable and sustainable energy future for Europe, one that is less susceptible to the geopolitical factors affecting gas prices and more aligned with the global drive towards a greener planet.

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Europe Desk
Europe Desk
The Eastern Herald’s European Desk validates the stories published under this byline. That includes editorials, news stories, letters to the editor, and multimedia features on easternherald.com.

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