Brit. Peers Call On EU To Diversify Energy Supply

The EU, Russia`s biggest trading partner, cooled ties with Moscow in protest at its behaviour during and after the war with Georgia.

The European Union has failed to deliver a policy of diversified energy supplies to avoid over-reliance on Russian oil and gas, a British parliamentary committee said on Thursday.

In a report examining the aftermath of the Russian-Georgian conflict in 2008, the House of Lords European Union committee said the EU had made "little progress" on safeguarding the flow of fuel to member states in eastern, southern and central Europe and should resolve the issue now.

"This policy failure needs to be remedied urgently. This issue will become a major test of whether solidarity between member states can be made a reality," the committee, comprised of members of parliament's upper chamber, said.

It called on EU leaders to agree a unified energy strategy, particularly a liberalised and interconnected gas market, at their next council meeting in March and also urged them to approve construction of the Nabucco gas project.

The EU and Russia agreed last week it was vital to avoid a repeat of a price dispute between Russia and Ukraine in January that shut the transit route via which Europe receives a fifth of its gas, and led to the most serious supply disruption for years.

The EU, Russia's biggest trading partner, cooled ties with Moscow in protest at its behaviour during and after the war with Georgia.

Russia drove Georgian forces from the pro-Moscow area of South Ossetia in August, repelling a Georgian assault to retake the region which threw off Tbilisi's rule in the early 1990s.

Moscow has since recognised South Ossetia and Abkhazia as independent states, secured by thousands of Russian troops.

Europe's trust in Moscow was further undermined by the January row, which underlined EU dependence on supplies from Russia's state-controlled gas behemoth, Gazprom <GAZP.MM>.

The EU is holding an energy security summit on May 7, where it could announce a decision on the Nabucco project allowing construction to start.

The 3,300-km (2,051-mile), 7.9 billion euro ($10.2 billion) pipeline would carry Caspian gas across Turkey, Bulgaria, Romania and Hungary to an Austrian distribution hub from 2013 and cut reliance on Russian supplies.

In its report, the cross-party British group also expressed concerns over reports of Russia distributing Russian passports to non-Russian citizens in South Ossetia, Abkhazia and Ukraine.

It said this was more worrying when taken in the context of remarks by Russian President Dmitry Medvedev last September where he said: "Our unquestionable priority is to protect the life and dignity of our citizens wherever they are."