Robert Habeck’s task has not become any smaller in the past two days. Since taking office, the Federal Minister of Economics has been working to secure Germany’s energy needs despite its fossil dependency on Russia. But in the gas supply, which is still almost 35 percent dependent on Russian supplies, there is a risk of further bottlenecks in the coming winter. Because the plan to fill up the German gas storage facilities – the fourth largest in the world – in order to get through the cold season is proving increasingly difficult.
On Tuesday, the operators of the second-largest liquefied natural gas terminal in the US announced that the plant will now be out of action for three months instead of the three weeks originally announced. Bad news for the EU. Around 70 percent of the gas liquefied in Texas is actually intended for the European market.
At almost the same time, the Russian state-owned company Gazprom announced that it would cut gas supplies via the Nord Stream 1 pipeline by around 40 percent. The Federal Network Agency confirmed the drop on Wednesday, currently the flow would be 59.1 percent. Gazprom cited delays in repair work by Siemens as the reason.
A gas compressor unit did not return in time from repairs in Canada because of the sanctions against Russia. Only a transmission of 100 million cubic meters of gas per day can be ensured instead of the usual 167 million cubic meters. On Wednesday afternoon, Gazprom even announced that it would only pump a maximum of 67 million cubic meters through the pipeline in the future.
The President of the Federal Network Agency, Klaus Müller, is concerned about the falling gas supplies from the Russian company Gazprom. “We are very vigilant. The fact that Gazprom is now reducing its deliveries through Nord Stream 1 to around 40 percent is a warning signal and cannot be justified from a technical point of view. Unfortunately, Russia is fueling uncertainty and driving up gas prices,” Müller told the Rheinische Post newspaper.
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If Gazprom only delivers 40 percent of the gas through Nord Stream 1 for weeks, Germany will have a problem. “That would make our situation significantly worse. We might be able to endure that over the summer, because the heating season is over. However, we now have to fill the storage tanks to survive the winter – also with Russian gas.”
Economics Minister Robert Habeck (Greens) does not see a combination of misfortune and bad luck. He suspects a Kremlin strategy behind the throttling of Nord Stream 1. “The maintenance of these plants is not under the sanctions,” he said on Wednesday. In addition, the maintenance was not due until the fall and technically more gas could have been delivered then. “I have the impression that this is a political decision,” says Habeck.
Energy expert Georg Zachmann is even clearer on the phone: “We are in an economic war,” says Zachmann, who works at the Brussels think tank Bruegel. Since the beginning of the war of aggression against Ukraine, Russia has been trying to keep energy prices high and make it difficult for European countries to fill up their stores for the winter.
Moscow’s demand to only pay for gas in rubles, as well as the delivery freeze to some countries, was always based on this calculation. But gas prices had recently stabilized – also because the EU managed to bring around a billion cubic meters of liquefied natural gas (LNG) to Europe every week. This is noticeable in many countries. In Germany, the gas storage facilities are currently about 55 percent full, significantly more than in the previous year.
“I don’t hear any alarmist signals from the industry,” says Sebastian Bleschke, Managing Director of the Energy Storage Initiative (INES), an association of operators of German gas and hydrogen storage facilities. However, Bleschke does not blame the new gas storage law, which the Bundestag recently passed, for the good filling levels. “The market prices for gas are currently still significantly lower than in winter, so there are still strong incentives to buy and store gas now,” Bleschke explained to the Tagesspiegel. This is certainly due to the risks that all sides see for the winter supply.
However, expert Zachmann fears that the decision in Moscow and the accident in Texas will make it noticeably more difficult to store the data. “Due to the throttling of Nord Stream 1 and the LNG outages, the EU countries are missing around a quarter of the gas reserves that we are currently storing every day,” he told the Tagesspiegel. Gas actually cost 108 euros per megawatt hour on Wednesday afternoon at Europe’s most important spot trading venue, TTF in the Netherlands. On Monday, the price was still around 84 euros per megawatt hour.
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Zachmann compares the actions between the EU states and the Kremlin with a game. However, one in which Russia appears much more sorted. “In the Kremlin, they know all the contracts very well. In the EU, the governments blame the companies and allow themselves to be played off against each other,” observes the energy market expert. He calls for a uniform approach by the EU states. Also out of selfishness.
Zachmann sees Germany only partially armed in the event of a gas supply stop, the consequences would be even more devastating in Austria, Hungary and Slovakia. “Except for Poland, who acted wisely and became independent early on, all countries east of Germany would be particularly affected.”
