Germany: the Worst Energy Shortages Are Yet to Come

The reality behind the frantic efforts of German Economy Minister Robert Habeck to find alternate suppliers for Russian gas, is that they have flopped. The prospective volumes of LNG that are supposed to come from the Gulf States, Ibero-America and the United States/Canada will not suffice to fill the gap created by the sanctions against Russia.

Germany’s mainstream media, nonetheless, continue to report the government’s announcements of alternate gas supplies to come soon to avoid alarming the citizens. But that has not stopped the Federal Net Agency from calling on the same citizens to reduce energy consumption even more – albeit without specifying how deep a cut to expect.

Consumption of gas in the industrial sector already dropped by 15% in 2022, and in private households by 12%. The decline was considerably more in many small and medium-sized companies, that were not able to afford the inflated energy costs or could not find a supplier who would sign a contract with them. The general supply situation has worsened since Jan. 1, after the three remaining nuclear power plants were taken off the grid on Dec. 31, with the uncertain option of being kept on reserve for emergencies until April 15. That, in itself, has reduced by 6% the national energy mix that was still available in 2022.

In this volatile situation, expert sources warn that Germany will lack no less than 15 billion cubic meters of gas next winter, a gap that cannot be filled by LNG. According to calculations by the Oxford Institute for Energy Studies, Germany faces a supply gap of around 30 bcm of gas later this year, and the so-called Floating Storage and Regasification Units (FSRUs), which are currently being installed with much fanfare in a number of German ports to allow the import of LNG, will be able to produce only less than half of this volume by the end of 2023. But Berlin stubbornly sticks to its policy of cutting gas consumption in industry and private households, rather than deciding to import sufficient volumes of gas from the place where these exist –namely Russia. That would, of course, entail the commitment to help repair the Nord Stream 2 pipeline.

In that context, we note that the Times of London reported on Feb. 1 that preliminary investigations into the pipeline sabotage have not yielded a single piece of evidence that Russia is to blame. On the contrary, European and German experts would not rule out that a western agency carried out the sabotage…