Germany sounds gas shortage alarm

Germany faces a growing gas shortage as Russian gas supplies to Europe dwindle. In order to prevent running out of gas this winter, Germany is seeking to burn more coal, use less gas, and develop clean energy. According to analysts, many European countries, including Germany, are looking for energy all over the world, but the supply of the international energy market is difficult to increase significantly in the short term, and high energy prices will also increase the pressure on European people and companies.

German Deputy Chancellor and Minister of Economy and Climate Protection Habeck said in a recent interview with the media that in order to save energy, he has now greatly shortened the time he takes to shower. Germany’s gas crisis is now “more serious” than the 1973 oil crisis, Habeck warned. If gas shortages continue, Germany will have a “severe winter” and certain industries will face a catastrophic situation.

This follows Habeck’s announcement on June 23 that the second phase of the natural gas shortage emergency plan, the alert phase, was launched. Launched in March this year, the contingency plan is divided into three stages: early warning, alert and emergency. During the alert phase, natural gas will be prioritized for storage over power generation. Once it enters the emergency stage, the German government will directly intervene, implement a rationing system for gas supply, give priority to ensuring households, hospitals and important institutions, and limit industrial gas use.

Germany’s Federal Network Agency, which oversees natural gas, electricity and other facilities, said that the current gas storage capacity of Germany’s natural gas storage facilities reached 58.65%, higher than the same period last year. However, if no additional measures are taken according to the current supply level of the “North Stream-1” pipeline, it will be difficult to achieve the goal of 90% gas storage in November this year set by the German government.

The “Nord Stream-1” pipeline is the main pipeline for the delivery of natural gas from Russia to Germany. Due to the overhaul of components, the gas transmission volume of the “Beixi-1” pipeline has now dropped to about 40% of the normal level. In addition to this, the pipeline is also scheduled for annual maintenance from July 11 to 21, when gas supply will be completely shut down.

Some analysts believe that 55% of the natural gas imported by Germany last year came from Russia. Now that Germany wants to get rid of its dependence on Russian natural gas, it will naturally face a shortage. Data released by Germany showed its natural gas imports fell by 22% year-on-year in the first four months of the year, while costs soared by 170%. In order to make up for the energy gap, the German government can only find ways to increase income and reduce expenditure, the most important of which is open source.

First, relax the use of coal again. The German government announced on June 19 that it will increase the use of coal and increase the power generation of coal-fired power plants. According to the German government’s previous plan, the country will phase out coal power by 2030. Second, develop clean energy such as hydrogen energy. When German Chancellor Scholz visited Africa in May, he discussed hydrogen energy cooperation with Senegal, South Africa and other countries. Third, expand the source of natural gas imports. Scholz and Habeck have visited each other this year, trying to import natural gas from Qatar, Senegal, Norway and other countries.

However, analysts pointed out that the above-mentioned open source initiatives in Germany will not alleviate the energy shortage in the short term.

First, 45% of EU coal imports come from Russia, and Germany’s figure is even higher at 50%. How can Germany fill the gap once it abandons Russian coal? At present, Germany intends to import coal from Indonesia, South Africa, Australia and other countries, but on the one hand, the production capacity of these countries is relatively fixed, and on the other hand, many European countries are rushing to buy coal, which may exacerbate the shortage of coal.

Second, neither importing LNG nor developing hydrogen energy can be achieved overnight. Germany lacks LNG terminals, and imported LNG also needs to be transited by other European countries. The large-scale production and utilization of hydrogen energy also requires huge investment.

Gas is now a “scarce commodity” in Germany, says Habeck. It is foreseeable that the longer the natural gas shortage continues, the greater the impact on German production, life and even the economic trend will be.