In 2004 in response
to calls for greater energy security due to sharply
rising oil prices and continuing Middle East tensions,
the UNECE launched the Energy Security Forum (ESF)
in which governments, energy producers and the international
financial community seek to reduce the instability
of global energy markets and its negative impact
on the world economy. The ESF is examining emerging
energy security risks and risk mitigation in a global
context. As part of this, the Forum will review
the contribution of the Caspian Sea region to promoting
greater regional energy security. Its Executive
Board held discussions in Geneva (March 2004) and
Moscow (June 2004) between representatives of governments,
the financial community and energy industries on
how oil price rises can be affected by energy security
risks. In this connection a new CD-Rom based UNECE
eBook "Energy Security Risks and Financial
Markets" was issued.
With serious doubts on the validity of oil reserves
that have troubled major oil companies and their
shareholders, the UNECE has established the Ad Hoc
Group of Experts on the Supply of Fossil Fuels to
promote the widespread application of the United
Nations Framework Classification for Fossil Energy
and Mineral Resources (UNFC) established as ECOSOC
Resolution 2004/233. This provides for the reevaluation
in economic terms of coal, oil, natural gas and
uranium reserves/resources to make these energy
commodities more attractive to foreign investors
for exploitation. This continues the valuable work
on the UNFC, which has been adopted by more than
60 countries worldwide and by selected stock exchanges.
The threat of global warming to the environment
and to the world economy is a priority to the Energy
Efficiency 21 Project that has launched a new phase
of its work for the development of practical methods
to reduce greenhouse gas emissions at the local
level in eastern Europe in order to implement the
global UN Framework Convention on Climate Change
and aspects of the UNECE Convention on Long-range
Transboundary Air Pollution. The United Nations
Foundation has accorded a significant new grant
to the UNECE for "Financing Energy Efficiency
Investments for Climate Change Mitigation"
in UNECE economies in transition. Project capacity
building activities produced 30 pre-feasibility
business plans for US$ 60 million of energy efficiency
investment project proposals with a total investment
requirement of US$ 30 million, which would produce
an estimated 368,000 tons of carbon emissions reductions
per year if they were all financed. Investments
of US$ 9.7 million were approved by the World Bank
and other investors for projects in Belarus, Bulgaria,
Russian Federation and Ukraine amounting to an estimated
49,000 tons of carbon emissions avoided per year.
The Gas Centre launched a new Task Force on Company
and Market Structure in January 2004 covering all
UNECE countries in Europe to look at gas markets
and gas industries as well as its implications for
countries in Central and Eastern Europe. The other
two Gas Centre task forces reviewed how Central
and East European countries and their gas industries
can best prepare themselves and benefit from the
experiences acquired in Western Europe and North
America notably on the opening and liberalization
of gas markets.
Under Regional Advisory services, the CIS countries
launched the second phase of the work on Energy
Efficiency and Energy Security in CIS. Energy efficiency
projects were approved with UNDP and Global Environment
Facility support in Ukraine, Kazakhstan, Russian
Federation and Belarus. The implementation of the
Rational and Efficient Use of Energy and Water Resources
Project with significant support of the United Nations
Development Account in Central Asia completed plans
for prototype investment projects during 2004.
A new technical assistance project was launched
on Coal Mine Methane in Central and Eastern Europe
and the CIS with extrabudgetary support from the
US Environment Protection Agency (US EPA) and the
United Nations Foundation. This project was launched
following the ministerial meeting on "Methane
to Markets" hosted by the US EPA in Washington
in November 2004 and will serve as part of the technical
follow-up to the commitments undertaken by ministers
at that meeting. The economic, social and environmental
dimensions of coal in the countries in transition
continue to be addressed.
Major challenges for 2005 include
new initiatives specifically in the area of energy
security, global financial markets, corporate governance,
policy dialogue, renewable energy sources, zero-emission
technologies and intersectoral activities. The work
programme will place more emphasis on economic development
as called for in the Millennium Declaration, such
as the restructuring in coal-mining communities
in countries in transition based on experience in
Western countries. It will provide additional analysis
and policy dialogue on key issues such as energy
security, the liberalization of energy markets and
the development of cleaner, more efficient energy
systems to reduce greenhouse gas emissions in line
with the recommendations of the World Summit on
Sustainable Development.
The work programme will be implemented increasingly
with innovative Internet applications to enhance
communications and value-added information transfers
within and between UNECE member States in accordance
with the recommendations of the World Summit on
the Information Society. It will build on intersectoral
activities initiated in the previous biennium with
joint projects in timber and transport, notably
on wood as an energy source and the "Blue Corridor"
project use of natural gas as a transport fuel.