Assistant Secretary Pyatt: Thank you to the Transatlantic Leadership Network and Sasha for having me here at this event.
I was saying to my fellow guests as we were walking into the Library of Congress building this morning, this is arguably the most spectacular building in all of Washington, DC, so it’s really nice to be able to meet in this setting.
And let me also say what a privilege it is for me to have this opportunity to engage with so many of the Energy Ministers, the Deputy Prime Ministers who are here from the Western Balkans for this important event today. I, of course, lived in the neighborhood for six years as U.S. Ambassador to Greece and had the opportunity in that period to get a good appreciation for both the challenges that the Western Balkans faces but also the tremendous opportunities, especially to deepen an already important partnership with the United States on the issues that I’m responsible for in energy security, energy transition, and climate.
There are also all of the related issues where American companies have sought to be strong partners, for instance in terms of technology, in terms of smart cities, all of the work that I did as Ambassador in Greece working with our Greek partners, especially in Thessaloniki, and to build on the famous Thessaloniki vision which still informs our approach to these issues.
Of course the other major issue that shaped my last months in Athens and has been the defining issue for my tenure as Assistant Secretary for Energy Resources is Russia’s brutal, illegal invasion of Ukraine that began more than 500 days ago now.
In addition to the horrific human cost that Russia’s invasion has inflicted — the suffering, the destruction of property, the targeting of civilian infrastructure — the invasion of Ukraine has had a dramatic impact on global and in particular European energy markets. By weaponizing Russia’s oil and gas resources Putin has ensured that Russia will never again be viewed as a reliable energy supplier. That fact alone is going to have a dramatic impact on how global energy markets behave in the years ahead.
But it has also perversely had the impact of accelerating the energy transition, in particular in Europe where governments have seen more clearly than ever before the risks of dependency on a single source of supply for fossil fuel and are therefore doubling down on their commitment to renewable energy for geopolitical and security reasons along with the obvious economic and environmental benefits.
The Biden administration has put forward two guiding principles in carrying out our foreign policy. The first, work with allies and partners as closely as possible and build on those alliance relationships. I think you saw that very dramatically in President Biden’s approach yesterday to the Vilnius summit.
The other, of course, is partnership with the private sector, including our private sector energy companies. And my team in the State Department’s Bureau of Energy Resources apply these principles every day, including through the very intensive work that the ENR team does with American companies operating in the energy space.
I want to be very clear. If there’s one message I can leave with you today it’s that the Bureau of Energy Resources and I personally are committed to continuing our very strong partnership with the Western Balkans on clean energy and energy security. This includes both diversification away from Russian fossil fuels and the rapid and responsible push for decarbonization, particularly through the immediate phasing out of coal and the increasing deployment of renewable energy where the Western Balkans has so much potential on wind, on solar, on geothermal where the United States wishes to be a strong partner.
But we also recognize that the Western Balkans is a region that represents challenges for historic and political reasons, for geographic reasons, for issues like water scarcity and leveraging your hydro resources, and because many of the countries of the Western Balkans are themselves developing countries that have been highly vulnerable to the external shocks that Vladimir Putin has induced on the price of fertilizer, the price of energy, the availability of basic commodities. But we are very, very committed to our partnership with your region.
Since 2021, for instance, the ENR Bureau has provided assistance to support the commercialization of geothermal energy and to catalyze private sector investment in geothermal projects across the Western Balkans. And of course as we move globally on the energy transition you are seeing a dramatically increased demand for the clean energy minerals that will be so essential to driving that electrified transformational economy — cobalt, lithium, copper, nickel. For this reason, the ENR Bureau’s mineral governance program is going to continue to work with the countries of the Balkans to promote new mining investment by helping to improve mining sector governance and the legal frameworks to attract the investment that will help to grow the region’s output of critical minerals.
We are convinced that these reform measures will accelerate progress towards renewable energy goals by increasing the supply of the minerals that will be so important to the energy transition.
We also of course are strongly committed to our partnership with the European Union on these issues. We very much support the EU’s green agenda for the Western Balkans and we are working to build complementarity between our programmatic initiatives and those of the European Union including with our development tool kit — institutions like the International Development Finance Corporation, the Export-Import Bank, the work that you are doing under the Mineral Security Partnership to help strengthen transatlantic critical mineral supply chains.
Our immediate priority is to help the Western Balkans get through this next winter as we did through the previous. Demonstrating to Putin that his efforts to weaponize energy against the countries of Europe and NATO will not be successful. We also recognize that we have opportunities as we get into the latter part of the 2020’s as there will be a much greater supply of LNG from America and other international sources.
The United States, for instance, now the world’s largest LNG exporter will, by 2025, accomplish roughly a 50 percent increase in our capacity for LNG production.
It should be clear to everyone at this point that Russia uses its energy as a weapon of coercion. But that tactic has failed, just as Putin is failing on the battlefield. I am convinced that we have crossed the Rubicon in terms of how Europe thinks about its energy relationship with Europe and there will be no going back to business as usual with Gazprom, with the Kremlin. This is the new reality of Russia’s isolation. And we are committed as the G7 to use our sanctions regime in the most targeted and effective way possible to reduce and restrict Russia’s ability to extract future energy resources.
As a result of all of this, we are seeing major structural shifts in European energy planning and European energy flows that are going to ripple across the continent and in particular across the Western Balkans for years and years to come.
In Southeastern Europe we have seen a dramatic transformation of the energy map as new interconnectors come online and open the region to alternative energy supplies and also facilitate greater regional energy integration and cooperation. These regional projects bring both energy security and diplomatic benefits as I saw so dramatically during my time in Athens leading U.S. support for the Alexandroupolis Floating Regasification Unit, a project which will come online later this year which has as its off-takers Serbia, Bulgaria, North Macedonia with investment shares from several of these countries and a vision of facilitating even more ambitious flows to the north to Ukraine and across the Western Balkans.
In the same spirit, we have been strong supporters of the TAP Pipeline, a project that I was just discussing with the Deputy Prime Minister of Albania which has literally transformed the energy map from Italy across to TANAP and Turkiye.
We also of course have been strong supporters of the Krk Island FSRU in Croatia, the IGB interconnector with Bulgaria. These are all projects that facilitate diversification of energy sources and energy routes.
In the same vein, we are very strong supporters of the planned interconnector between Greece and North Macedonia which we see as bringing both energy security benefits and reinforcing the political benefits from the Prespa Agreement and the dramatic improvement in relations between Greece and North Macedonia.
In both the short and the long-term the interconnectors between Bulgaria and Serbia which are set to be complete by 2023, and the Southern Interconnection between Croatia and Bosnia Herzegovina which needs to advance now could further expand the region’s access to natural gas from non-Russian sources.
I want to be clear. We view natural gas as a positive step towards diversifying the region’s energy mix and as part of the pathway towards a zero carbon energy system that we all are committed to.
In the near term, of course, one other benefit of these new gas interconnectors will be to reduce the region’s reliance on coal and thereby improve local air quality. We also want to work together with all of the governments of the Western Balkans to accelerate their investment in new zero carbon alternative sources like wind, solar and geothermal.
Transatlantic energy cooperation continues to contribute to the stability and transparency of global markets by promoting diversification and security, by endorsing energy efficiency measures, and by developing the technologies that we will all need to transition towards net zero by 2050.
The United States is pursuing an “all of the above” strategy to support the accelerated deployment of clean energy resources. Transitioning away from coal to clean energy sources helps to achieve our collective decarbonization targets, promotes clean energy and green jobs, and enhances energy security goals by reducing vulnerabilities and opportunities for malign influence.
But of course there are challenges to our shared success. One fundamental principle is the need to continue adherence to the Dayton Accords. Without that the United States will be limited in our ability to help.
We also hope to see the Western Balkans really commit to fighting corruption. Corruption has a deeply corrosive impact on democratic and economic development and thus to the energy security of the region.
We also want to seize this moment to make real progress in helping our European and Western Balkans allies find viable alternatives to imports from Russia, including fuel substitutes, and implementing demand reduction strategies to use energy resources more effectively.
To conclude, I want to underline that the United States and our allies and partners are more united today than ever before in our determination to stand up to Russia, to ensure global energy security, and to accelerate the clean energy transition and in a just and equitable manner.
The Western Balkans is very much part of this larger story. It’s a story that I’ve been privileged to participate in through the past seven years of my diplomatic career and I very much appreciate, Sasha, the opportunity to be part of the discussions today.
Thank you very much, and I look forward to hearing the further conversation.