Comment by yorwba | Hacker News Reader

Comment by yorwba | Hacker News Reader

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> The problem of relying on Russia for energy was obvious.

In 2020, the EU imported 13 786 PJ of natural gas, while gross available energy was 57 767 PJ, i.e. gas imports accounted for 23.9% https://ec.europa.eu/eurostat/statistics-explained/index.php...

Also in 2020, 27.2% of petroleum gas imports into the EU were from Russia. https://oec.world/en/profile/international_organization/euro...

Put together, 6.5% of gross available energy in the EU was from Russian gas.

It's not so obvious that that is a problematic level of reliance threatening the political autonomy of an entire subcontinent.

If it meant that 6.5% of the population will be left without any energy, that would be quite terrible. If it meant a 6.5% drop in GDP per capita PPP, it would be worse than the drop from 2019 to 2020, but still only throw the EU economy back to 2013 levels.

That doesn't mean it isn't worth planning ahead for the consequences of reduced energy availability, but maybe we don't need to panic, either.

> > The problem of relying on Russia for energy was obvious.

> Put together, 6.5% of gross available energy in the EU was from Russian gas.

In case anyone is curious, the sources I find suggest the following about the sources of the primary energy in the European Union:

~38% from oil, of which ~29% is from Russia = ~11% of total energy, plus

~24% from natural gas, of which 39--45% [note this is higher than in the parent comment] is from Russia = 9+% of total, plus

~14% from coal, of which 46--70% is from Russia = 6+% of total energy, plus

~11% from uranium (nuclear), of which ~20% is from Russia = ~2% of total energy,

altogether totaling >28% from Russia.

Other sources may disagree on the particular numbers, but the rough estimate of "one quarter" is in line with other sources: https://www.weforum.org/agenda/2022/04/europe-russia-energy-...

Some sources for the individual numbers: https://en.wikipedia.org/wiki/Energy_policy_of_the_European_... https://en.wikipedia.org/wiki/Russia_in_the_European_energy_... https://ec.europa.eu/eurostat/cache/infographs/energy/bloc-2... https://www.statista.com/statistics/1034930/eu-hard-coal-imp... https://www.dw.com/en/eu-ban-on-russian-coal-imports-comes-i...

I can see why someone might hear that number and shrug. But given what’s happening to the energy prices, I think those 6.5% are more significant than “1/16th” feels like it ought to be.

Yes, the price increase is larger than the reduction in supply. Nobody wants to reduce their energy use by 6.5%, so everyone is trying to snatch up as much of the shrunk energy pie as possible, bidding up the prices in the process.

But there's a limit to the price war. At some point, a factory making widgets is going to look at price increases that make the cost of producing a widget greater than its expected sale price, at which point they'll probably stop their production lines, unless they feel like setting money on fire to keep them running. Those factory closures then provide for the necessary reduction in energy use. But everyone else still needs to pay the higher prices.

Fortunately, higher energy prices also incentivize increasing supply from alternative sources, so the EU probably won't have to reduce energy use by the full 6.5%. And as long as people setting money on fire are sufficiently rare, it will be energy-intensive, low-profitabilty users who give up first, so the economy likely won't shrink by 6.5% either. But a larger fraction will be captured by energy suppliers as profit.

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