– Over the past few weeks, we have made intensive efforts with all relevant players to import less fossil fuels from Russia and expand its supply. The first important milestones have been reached to free us from the grip of Russian imports, the Vice Chancellor and Federal Minister for Economic Affairs and Climate Protection, Robert Habeck, announced on March 23. This is in response to the actions of Germany’s energy partner – Russia. Germany wants to diversify its gas supply and accelerate the development of RES and the energy transition. “RES is safety”, repeatedly said Habeck.
Habeck, in a recent report, informed that progress had been made since the outbreak of the war, primarily in oil and coal. “Companies are letting contracts with Russian suppliers expire, not renewing them and switching to other suppliers. And it’s happening at a furious pace,” the Vice Chancellor continued. As a result of such contract changes, dependence on Russian oil will now drop to about 25 percent. The revised supply chains will go into effect in the coming weeks. Germany’s Russian oil imports are expected to halve by mid-2022. We want to be almost independent by the end of the year”, the government representative explains.
Also in coal, companies have reorganized their supply chains and contracts. As a result, coal dependence will drop from 50 percent to 25 percent in the next few weeks. By early summer, most operators will have completely abandoned hard coal from Russia. By autumn, Germany could be completely independent of Russian black coal – at least that’s what the government believes.
On the first day of the war, Germans talk about the economic consequences
On the day the war broke out in Ukraine, German Vice Chancellor and Minister of Economy and Climate Protection, Robert Habeck, indicated that for Russia an attack on an independent state would have serious political and economic consequences. This is said by a representative of a country that is heavily dependent on imports of raw materials from Russia, especially gas, for example through Nord Stream. Therefore, it is not surprising to see German resistance in some decisions. At the same time, Germany is pursuing a groundbreaking energy transition project, which involves moving away from coal and nuclear, betting on renewables, the hydrogen economy, and, temporarily, gas. The German government is working to fill gas storage facilities and stockpile coal reserves.
Blue fuel diversification and accelerated gas diplomacy
The war in Ukraine has caused Germany to worry about gas supplies over time. The key is diversification of supply. First, activities related to the construction of three LNG terminals in Germany (including Brunsbüttel) have been accelerated. Germany is in talks with Qatar and the United Arab Emirates regarding energy imports. Qatar is ready to export LNG, but Germany does not yet have the infrastructure necessary to receive liquefied gas. For Emirates, the vision includes importing hydrogen.
– It is absolutely clear that we need to make energy supply climate neutral, consistently reduce gas consumption, and move forward with RES development and hydrogen production at full speed. But we need gas to move along”, the minister said.
Habeck said after the Energy Council meeting in Brussels that the Russian attack on Ukraine must also shake up Europe’s energy policy. In the future, there are plans to convert the terminal to import green hydrogen derivatives such as ammonia.
– Energy policy is security policy. Strengthening our energy sovereignty strengthens our security. Therefore, firstly, we must overcome our heavy dependence on fossil fuel imports from Russia – a belligerent partner is not a reliable partner. Second, we need to accelerate the energy transition at the European level. The development of renewable energy is a matter of national and European security, he told reporters.
Habeck also visited the U.S. in February, where he raised energy security issues in the transatlantic alliance.
– The most important key to our energy sovereignty is a widespread transition toward more renewable energy and greater energy efficiency. The expansion of renewable energy is a matter of national and European security, he explained.
During a visit to Norway in March, Vice Chancellor Habeck signed a joint statement with Norwegian Prime Minister, Jonas Gahr Stør, on large-scale hydrogen imports to Germany from Norway via a new gas pipeline.
Germany has also agreed to an energy partnership with Israel. Areas of future cooperation include renewable energy, cyber security of energy infrastructure, technological innovation, gas, and hydrogen.
Brief thoughts on extending nuclear units
The German government has analyzed whether and to what extent extending the life of nuclear power plants will contribute to energy security in the face of Russia’s war with Ukraine, particularly in terms of covering energy supplies during the coming winter. The ministries concluded that extending the service life could only make a very small contribution to solving the problem, and would come at a very high economic and safety cost. They eventually abandoned the idea.
Germany is transforming, but emissions are rising
Unfortunately, after a significant decrease in the previous year, Germany’s greenhouse gas emissions are on the rise again. The country released about 762 million tons of greenhouse gases in 2021 – 33 million tons (4.5 percent) more than in 2020. Overall, Germany’s emissions have fallen by 38.7 percent since 1990. The increase in the last year is particularly noticeable in the energy sector. Electricity production from RES has fallen by 7 percent, mainly due to poor wind conditions. This is according to the latest calculations by the Federal Environment Agency (UBA).
RES and offshore wind farms will give security
In addition, the Federal Ministry of Economics and Climate Protection (BMWK) is working intensively on the development of renewable energy sources (the so-called “Easter Package”) and will soon present an energy security strategy. EEG surcharges on energy bills are being considered for elimination, effective 1 July 2022.
The government had already signaled an acceleration of offshore wind development before the war. Investors see the political will for long-term expansion of offshore wind, but real action is needed to expedite permitting.