Speaking to To Vima International Edition on the sidelines of the Delphi Economic Forum, former U.S. Ambassador to Greece and Ukraine and former Assistant Secretary of State for Energy Resources Geoffrey Pyatt reflected on the current energy crisis and the reshaping of the energy map in Southeast Europe and the wider region.
Pyatt, who has long supported the development of the so-called Vertical Corridor natural gas pipeline linking Greece to Ukraine, argued that natural gas is important, but the region must think beyond gas alone and build a broader energy architecture centered on diversification, resilience, and long-term competitiveness. He also pointed to nuclear’s growing relevance in Central and Eastern Europe and warned that the market is underestimating the duration and severity of the current energy crisis.
Q. You have long supported the development of the so-called Vertical Corridor, a strategic gas network linking Greece to Ukraine, through your roles as U.S. Ambassador to Greece and Ukraine, Assistant Secretary of State for Energy, and now as a private consultant and thought leader. LNG is taking center stage in the reshaping of the energy map in Southeastern Europe and the Western Balkans, but you have also stressed the importance of diversifying energy sources in your vision for the region. What do you mean by that?
Greece has been ahead of the curve in terms of diversifying energy, and we should try to develop all opportunities. You have to keep a consistent focus across all the different areas and sources of energy, which, frankly, if you go to Texas, for instance, today, is exactly the same situation. Texas is the biggest state in the United States and, today, the most advanced in terms of solar and wind power deployment. But it’s also the home of our oil and gas. And that’s not a coincidence.
So, I think, on the vertical corridor, for instance, I am very excited to see the progress that’s being made in continuing positive movement on gas tariffs and all the issues we just talked about on our panel. But we need a vertical corridor for data. We need a vertical corridor for electricity. And you have a market globally, which is looking for more clean electricity.
Q. Nuclear is increasingly coming up in discussions about Europe’s energy future. How do you see its role evolving?
Indeed this is a topic we are hearing more about and I gather Prime Minister Mitsotakis talked about it last night, as well. In the U.S., nuclear is currently about 20% of the energy mix. And, there’s a lot of excitement in the U.S. because our hyper scalers like Amazon, Google, and Microsoft are putting money into the new development of small modular reactors.
Like LNG, this technology is going to take time to develop. It’s gonna be sometime closer to 2030 when we actually start getting power out of any of these projects. We have to bring down the cost, and you can see already the debate between companies regarding the type of nuclear energy we should invest our resources in. There are some companies, like Westinghouse, who are saying that the future is still going to be big traditional reactors, 1,000 megawatt plus, but you also have a lot of innovation happening in both shrunken down traditional reactors, but also new technology packages. It’s too early to know which of those are going to prevail.
It’s very clear is there’s going to be a lot of capital poured into this area in the United States, coming from the data center. After the United States, the big frontier market is going to be central and Eastern Europe, because you have a need to replace power that used to come from Russian gas, and you have a long history of knowing how to use nuclear power safely in Bulgaria, in Romania, in Slovakia, in Hungary and so on. So there’s a lot of excitement among the companies in building on that to develop opportunities and then develop the supply chains. Because, as we always say and as Hill International said on our panel, a lot of this is about simple choices like ease of sourcing, time for delivery, limitations, and so on.
Lets look at the details, such as the supply chain today for new gas wind turbines, like the ones a few kilometer from here by Mytilineos. If you call GE today to order one of those, you would get a delivery date at the end of this decade. It’s problematic.
Q. Much of what is being discussed in energy today is long-term and structural. But what happens in the meantime? How do countries bridge the gap over the next few years?
We already see companies and countries repositioning as a result of the lesson we learned from the closure of the Strait of Hormuz. The lesson is that we need to have more diversity. As a result, you’re going to see more pipelines being built to go around these chokepoints. You’re also going to see faster growth of renewables because once you have built the infrastructure, you don’t have to worry about anybody cutting off your supply of molecules.
I think beyond that, the other point I would make is that markets so far have underestimated how long lasting and severe the impact of this crisis with the Strait of Hormuz is going to be. That is to say, it’s going to well into next year at the earliest before energy prices return to the levels that they were at before- and that assumes that the crisis ends tomorrow.
