Energy Security and Economic Integration: A Comparative Analysis of Europe and Asia-Pacific

Abstract

Rising concerns over climate change in the recent years have increased the importance of energy for policy makers, and energy security is a central concept in energy policy. In particular, Asia and the Pacific (hereafter Asia-Pacific) and Europe are two regions facing numerous challenges related to energy. The European Union (EU) is the world’s largest economy, as well as the largest trading bloc, but it is relatively poorly endowed when it comes to energy resources. As a consequence, the EU remains quite dependent on its energy imports. Conversely, AsiaPacific is a fast-developing region, with an increasing demand for energy, due to a growing middle class and a large population. As shown on Table 24.1, the world total energy consumption grew from 8,761 million tons of oil equivalent (Mtoe) in 1990 to 14,126 Mtoe in 2017. Around 70% of this change was initiated by the energy consumption of the Asia and Pacific region, which increased its global share from 25% (1990) to 41% (2017). This energy consumption dynamic of Asia-Pacific contrasts with the energy consumption of Europe, which has remained stable during the same period. Hence, the consumption ratio between AsiaPacific and Europe rose from 1.2 (1990) to 3.2 (2017). Contrary to the EU, some countries in Asia-Pacific and Oceania (e.g., Australia and Brunei Darussalam) are fully endowed with energy resources, while others (e.g., Japan and the Republic of Korea) are very much reliant on energy imports. In addition, the majority of the region’s energy comes from fossil fuels, which are faced with environmental and health issues. The uneven distribution of energy resources coupled with the rising demand pose many challenges at the national, subnational, and regional level in terms of the region’s energy security and environmental sustainability. Consequently, there is a need to establish effective regional energy integration strategies in the region, which build on energy cooperation as well as possible regional energy partnerships to help protect the environment.