Shipment of turbines to Berlin | Heavy toll of energy dependence for Germany

Since the Russian invasion of Ukraine, Germany finds itself in a situation of great vulnerability in terms of energy. Even if it has since been able to reduce its dependence on Russian gas, from 55% to 35% of its supply, the rest of the way will be difficult to travel to achieve full independence from Moscow in a few years.

Posted at 9:00 a.m.

Yvan Cliche

Yvan Cliche
Fellow, energy researcher, Center for International Studies and Research of the University of Montreal (CÉRIUM)

In the meantime, Germany will remain in a weak position for some time. Its short-term priority is to get through the next winter, maximizing its storage capacities.

Europe has set its members a target of 80% filling of their gas tanks for the autumn.

The turbines repaired in Montreal to be sent by Siemens to its Russian customer for gas supply via the Nord Stream 1 gas pipeline are aimed at this end, namely to help Germany continue to fill its reservoirs, and to reduce the chances that Russia does not deliver the quantities stipulated in the contracts.

Besides this, Germany will greatly need favorable circumstances, including mild temperatures, to get through this long-lasting crisis.

The renowned Oxford Institute of Energy Studies (London) says that the European continent found itself at the start of the Ukrainian crisis near a precipice. He writes that he is now in the precipice, and tries to pull himself out of it with the fingers of one hand… 1

A little history

Germany’s energy ties with Russia date back to the 1970s. West Berlin Mayor Willy Brandt, who later became Chancellor of West Germany (1969-1974), believes that trade with the countries of Eastern Europe is necessary to reduce divisions in this period of cold war. This approach is called Ostpolitik.

With the oil crisis of the 1970s and the embargo actions of Arab countries, Germany lost confidence in this region for its energy supply.

Then its energy transition policy, called Energiewende, excludes nuclear power, whose production will end this year, and puts on the end of coal. So there aren’t many options left.

Driven by an industry hungry for this cheap and abundant Russian gas, the country signed supply agreements with Russia and gas pipelines were built, including Nord Stream 1 and Nord Stream 2, linking Russia directly to Germany.

All this under the vigorous protests of successive American leaders, decrying the energetic blackmail that Russia could exert on the Germans. Not to mention the billions garnered by Moscow allowing it to strengthen its army.

The current situation

To reduce its current vulnerability to Russia in the short term, Germany and Europe are betting on additional supplies via existing gas pipelines from North Africa, Azerbaijan and Norway. But the room for maneuver is not very important. The global gas market is tight, at full capacity, as evidenced by high prices over the past two years.

The alleviation of Europe’s energy dependence also depends, and a great deal, on the import of liquefied natural gas (LNG), from the United States in particular, which increased by more than 50% compared with the January period. -June 2021, and robust and rapidly deployable energy efficiency measures.

These actions should lead to a halving of gas imports from Russia by the end of the year.

It is on the other part of its supply that Germany is now at risk of a sudden cut in Russian supply, a very real possibility.

It has no LNG import terminals: it can use floating terminals, but of lesser capacity than terminals on land. However, these infrastructures take about four years to set up.

Cruelly, what would help Germany and Europe is a recession: this would reduce global demand for gas, particularly in Asia, and prices. A mild winter would also be an important factor, as gas in Europe is used in particular for heating buildings.

And it will be hoped that the population in Europe positively appropriates this challenge of a much more sober consumption of energy, in particular thanks to the drop in the temperature of the thermostats, by using less hot water, lighting.

For the powerful German industrial sector, next winter could be very difficult. Gas rationing measures, forcing a drop in production, or even layoffs, are possible.

One thing is certain, Germany is paying dearly for its energy dependence on Moscow.

1. The Oxford Institute for Energy Studies, REPowerEU and the Short-Term Outlook for the European Gas Market, July 2022.


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