Thursday, March 16, 2006

G8 energy ministers' talks in Moscow

Russian Minister of Industry and Energy Viktor Khristenko addressed the issues of global energy security, fuel and energy market effectiveness and the stability of the world's energy system at a meeting of energy ministers of the Group of Eight industrialized nations Thursday.

Opening the meeting in Moscow, Khristenko said high oil prices had affected poor nations and hampered global economic growth. "The price situation is not very favorable [on global markets] at the moment, as high oil prices have sent prices for other energy resources and some other products up," he said.

The minister stressed that the oil price fluctuations and their contingency on unpredictable economic factors influenced global economic trends, and were particularly harmful for poor nations.

The minister called for the creation of a reliable global transportation system to ensure the supply of energy resources to world markets, including the construction of pipeline networks and tankers to transport liquefied and gaseous hydrocarbons.

The minister also suggested that international electricity supply networks should be formed as part of the future energy system to ensure the diversification of energy sources and energy consumption centers across the globe.

He said energy efficiency was a key tool to control demand for energy resources and help stabilize markets."We cannot ignore important instruments - like the diversification of the energy resources portfolio according to fuel types, suppliers and consumers, and also the transportation of energy resources - that could lower energy security risks not only for
individual countries, but also for the global community as a whole," he said.

Khristenko said resources should be diversified along various lines, and alternative energy sources and new technologies should be explored."The joint efforts of G8 and other countries on the broader use of sustainable and alternative energy sources, and the development of innovative technologies in the energy sphere...can make a significant contribution to the solution of this strategic task," he said, adding that safe nuclear energy was also important.

He said market approaches aimed at increasing energy supplies and restraining the growing demand for energy were needed to rebuff challenges to energy security, and that these approaches should "boost the development of market mechanisms for pricing, competition, energy efficiency and energy saving."

He pointed to the necessity of creating a favorable investment climate. "Securing sufficient investment in the development of the global energy sector is only possible in a favorable investment climate and given political stability in countries that produce and consume energy resources, as well as in transit states," the minister said.Investment incentives include good legislation, clear tax rules, respect for contracts, reliable dispute settlement procedures, and measures to reduce red tape, he said.

G8 energy ministers see nuclear energy as the only viable option for some industrialized states, Russian Industry and Energy Minister Viktor Khristenko told a media briefing after the Thursday meeting with his G8 counterparts.
The session has come to a conclusion that for some leading economies, nuclear energy will inevitably be part of the future,” he said.
“The meeting touched upon such sensitive issues as nuclear energy, environment, and nonproliferation,” he added.
“Nuclear energy was in the focus of the ministerial meeting. Capabilities of and prospects for world nuclear energy industry are in any case connected with Iran’s nuclear program,” Khristenko said.
The global community should come up with initiatives as to how to ensure energy-hungry nations’ access to peaceful nuclear energy and “how to make sure the access does not become non-peaceful,” the official said.

The Germans also provided some interesting foresights on technology.

G8 will work out an action plan on energy production safety improvement during Russia’s 2006 G8 Presidency, State Secretary of the German Federal Economics and Technology Ministry Georg Wilhelm Adamowitsch said. The energy ministers decided to have the action plan drafted this year and refined next year when Germany takes over the rotating G8 Presidency, he said.

Technologically, the progress made so far is far better than the public debate might suggest, he added.
Adamowitsch also said the issue had been discussed at the G8 energy ministers’ meeting with the U.S. and U.K. counterparts. The discussion resulted in a joint commitment to work on the issue intensively, he vowed. Further progress on the issue could save nearly 2 billion tons of energy within a year, he also said. By 2020, Adamowitsch said, this work could result in a zero-CO2-emission coal-firing power plant.


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