30.04.2024.

Moldova eyes energy lever to topple Kremlin puppet regime in Transnistria

For the first time, Moldova can cut an energy link to its breakaway territory. Yet doing so risks Moscow’s threats and a possible humanitarian crisis.

The face-off has been tense, but maintained by a powerful connection: Moldova gets cut-rate Russian energy via Transnistria, which gets hundreds of millions of euros a year in return. The link allowed Russia to preserve control over the strategic strip of land along the Ukrainian border, where its troops are stationed despite Moldova’s objections.

That dynamic is changing, however. Moldova in recent years has integrated with Europe under pro-EU President Maia Sandu. Brussels has offered millions of euros and more links to its energy supplies as part of a yearslong process to get the country, one of Europe’s poorest nations, ready for EU membership.

“Moldova is no longer dependent on Transnistria,” Moldovan Foreign Minister Mihai Popșoi told POLITICO. “When it comes to gas, we buy gas on the international market. On the electricity side, we are building high-voltage lines to connect ourselves to Romania.”

The switch is a problem for Transnistria, but also for the Moldovan government. Stopping payments to Transnistria would collapse the separatist state’s budget and leave hundreds of thousands of people there without incomes and basic services — a challenge that, for a country Moldova’s size, would be akin to the reunification of Germany following the fall of the Berlin Wall.

“The elites in Transnistria acknowledge already that we buy electricity from the region not because we have to but because the alternative is to throw the region into a humanitarian crisis,” Moldovan Energy Minister Victor Parlicov said in an interview.

Still, officials are unequivocal: It’s time to end the multi-generational deadlock.

“There is a strong incentive now for us to reintegrate the country peacefully,” said Popșoi, who was appointed foreign minister in January. “Solving the conflict means full reintegration and Moldova taking control of its sovereign borders.”

Power play

From the bridge over the river Dniester, you can see the Russian soldiers. Wearing camouflage uniforms, they huddle together against the rain at a checkpoint emblazoned with the Soviet hammer and sickle.

These are just a few of the 1,500 Russian troops keeping Transnistria under Moscow’s thumb, more than 30 years after Moldova gained independence from the USSR.

Over the years, Transnistria has developed its own armed forces, public services and pension schemes — all funded through marked-up sales of cheap Russian energy to Moldova.

“The entire region is dependent on free gas like it’s drugs,” said Parlicov, the energy minister, speaking from the imposing government building in Chișinău’s central square.

Moldova, too, has been hooked on the discount energy. The Russian-owned Cuciurgan power plant in Transnistria is Moldova’s largest energy source, supplying around four-fifths of the country’s power in exchange for hundreds of millions of euros a year. Moldova also relies on high-voltage cables running through Transnistria, giving the region — and its Russian partners — even more leverage.

“The beauty of it for the Russians was that by buying electricity from the Transnistrian region, we were basically financing the separatism in our own country,” Parlicov said.

The EU has changed that calculus. In recent years, Brussels has given Moldova tens of millions of euros to build infrastructure and cement its connection to European energy networks, offsetting the costs of buying supplies from elsewhere.

That means Moldova doesn’t have to buy Transnistria’s gas anymore, which could spell trouble for the breakaway state. Transnistria has used access to discounted Russian fuel and electricity revenues to build an industrial sector that would crumble virtually overnight if Moldova cut off payments.

Yet Moldova is keenly aware that destroying Transnistria’s economic engine also means harming local citizens — the same people it wants to reintegrate into Moldovan society.

“We’re talking about up to 300,000 people, almost all of them are our citizens, and they need to be provided with basic services,” Parlicov said.

Breaking the habit

It’s a conundrum that looms over Sandu’s Western integration push.

Since Sandu won power in 2020, Moldova has made strides in tackling corruption, reforming public institutions and strengthening its democracy. For its efforts, the country was granted EU candidate status last year, and talks over joining the bloc are ongoing.

However, there are lingering questions over whether Moldova could join the EU while it has a separatist conflict and Russian troops stationed on its soil.

European politicians have previously hinted that the Transnistria issue may have to be settled before its application clears the final hurdle. Moldovan leaders are pushing back, repeatedly urging Brussels not to let Moscow and its proxies determine Moldova’s EU fate.

Undercutting the breakaway region’s cash flow by ending its energy monopoly offers a chance to heal the country’s divisions and join the bloc as one nation.

“Solving the energy issue with Transnistria would be a major step forward,” said Viola von Cramon-Taubadel, a German MEP and member of the European Parliament’s foreign affairs committee. “But will this be enough for Transnistria to slowly but steadily integrate into the country?”

Hybrid threat

Transnistrian leaders are unlikely to go quietly. In March, its officials called on the Kremlin to “protect it against the pressure of Moldova,” claiming that the country was staging an economic blockade — despite the daily flow of goods and services that pass Russian checkpoints.

Russian President Vladimir Putin and his inner circle, meanwhile, have stepped up their rhetoric against the country, attacking its European dream with rhetoric similar to what they lobbed at Ukraine.

Yet Russia’s ability to intervene is, in practice, limited. Since the start of the war in Ukraine, local Russian forces have been cut off from their usual supply lines, unable to bring in reinforcements or fly in hardware. Many haven’t been rotated in or out of Moldova in years, and have settled down and raised families locally. And while they sit atop one of Europe’s largest arsenals of weaponry and ammunition at the closely guarded Cobasna depot, it is widely believed to hold little else but decaying WWII-era equipment that hasn’t already been sold off or repurposed by the Russians.

Other frozen conflicts in the post-Soviet space have culminated in catastrophe. Just last year, a standoff between Azerbaijan and Armenia led to a mass exodus of 100,000 people from Nagorno-Karabakh.

But in Moldova’s case, there’s no ethnic animosity driving efforts to end the standoff. Almost all Transnistrian residents have Moldovan passports and move freely through the Russian-guarded checkpoints. Just like Moldovans living elsewhere in the country, Transnistrian residents stand to benefit from the economic boom of joining the EU — no matter what Putin might want for them.

Even if Moscow can’t muster up a military intervention, it can still create problems for Moldova. Last year, Kyiv’s intelligence services warned it had intercepted a Moscow plan to stage a coup and oust Sandu, using a pro-Russian opposition party to overthrow the government. Presidential and parliamentary elections scheduled for October will be a critical moment for Moldovans to decide their future — and a chance for outside powers like Russia to meddle.

In response, Brussels has deployed a mission to the country to help counter disinformation designed to weaken Moldova’s EU ambitions.

“The EU needs to continue to help Moldova with energy so they become completely independent from Russia,” said Ivana Stradner, a research fellow at Washington’s Foundation for Defense of Democracies. “And we need to make sure that if things escalate we are not afraid of Putin’s provocations in the country — if we don’t want the West to be seen as a paper tiger, we need to be ready to help Moldova.”