Germany, Europe’s economic powerhouse, has opted to burn coal to avoid the nightmare of winter supply disruptions as Russian gas supplies fall.
Germany is working on a new law to reopen up to 10 gigawatts of idle coal-fired power plants for two years, Economy Minister Heinz Habeck said on Sunday.
It is worth mentioning that In the context of carbon neutrality, Germany plans to phase out coal use by 2030.But now, faced with the impending disruption of gas supplies, Germany seems to have lost its green hand.
Harbeck said the move was a “necessary move,” but in this case, reducing gas use was critical.He called on operators of coal-fired power plants to “prepare now so that they can be operational as soon as possible”.
Last week, Russia was reported to have cut supplies from the Nord Stream 1 gas pipeline to Germany by 60 per cent.
Italy and Slovakia reported Monday that gas supplies were at half their normal levels, France has not received Russian gas via Germany since Friday, and Austria has been told to cut supplies.
Across the Atlantic, a series of explosions and a fire at freeport Gas, a big US LNG exporter, at its Quintana Island plant in Texas on Wednesday caused gas production in the region to plummet.Europe’s hopes for US gas supplies may be dashed.
Squeezed between Russia and the US, Dutch gas futures, the continental European benchmark, jumped more than 40 per cent last week.
In order to safeguard gas storage, Germany plans to install four floating LNG terminals and prioritise increasing storage tanks for winter use.Mr. Harbeck expects inventory levels to reach 90% in December, up from about 56% now.
“We need to do everything we can to store as much gas as possible,” Habeck said, making it a “top priority” otherwise “there will really be a [supply] crunch in the winter.”
In addition, Germany plans to auction natural gas to companies to curb consumer demand.
Germany aims to reduce normal consumption by about a fifth without rationing, while increasing pipeline supplies from Norway and imports of liquefied natural gas.
However, if Europe has a cold winter this year, gas supplies will be even tighter.Germany’s gas regulator expects average temperatures to be 6 degrees Celsius or lower from November to April.
If Russian supplies were cut off completely, even at 90% of Germany’s reserves, it would cover only two to three months of normal winter gas consumption, analysts say.