Russian gas shut-off raises German energy fears

4th January 2006, Comments 0 comments

4 January 2006, BERLIN - Russia's shut-off of natural gas to Ukraine and the ripple effect it caused across Europe this week have triggered alarm in Germany sparking a major new debate about energy security.

4 January 2006

BERLIN - Russia's shut-off of natural gas to Ukraine and the ripple effect it caused across Europe this week have triggered alarm in Germany sparking a major new debate about energy security.

With Germany getting two-third of its energy from abroad - much of it from Moscow - tabloids have raised menacing images of the Russian bear shutting off heat to German homes in mid-winter.

"Are the Russians going to turn off the gas if we get out of line?" screamed a headline in Berlin's B.Z. daily.

Economics Minister Michael Glos, although taking a more sober approach, stressed the Russian-Ukrainian conflict was a stark warning that Germany had to develop domestic energy supplies.

"We have to fundamentally think about how we can secure our energy over the long-term with sources from Germany," said Glos.

Germans are still haunted by memories of the 1973 oil crisis, which forced the nation's famed Autobahn system to be shut down every Sunday so as to save fuel.

Germany generates almost 50 per cent of its electricity from coal, 30 per cent from nuclear power, 10 per cent from renewable sources such as wind and the rest from gas and oil.

But almost 50 per cent of German homes and buildings are heated with natural gas with about 35 per cent of Germany's gas coming from Russia.

Russia is also by far Germany's biggest oil supplier and delivered crude worth 8.4 billion euros (10 billion dollars) to Germany during the first 10 months of last year out of total imports valued at 28.1 billion euros, according to the Federal Statistics Office.

Nuclear power has abruptly re-emerged as a wild card in the German energy mix given Moscow's apparent use of gas as a political lever.

This is even though ex-chancellor Gerhard Schroeder's SPD-Greens government in 2000 ordered closure of all 18 German nuclear plants by 2021. The first nuclear station was shut down last May.

In reply to the Ukraine gas shut-off, members of Chancellor Angela Merkel's Christian Democrats are now calling for existing German nuclear power plants to remain in operation.

This has been met by a furious response from Schroeder's Social Democrats who serve as their government partners.

The row - the first major public dispute to engulf the government since it was set up last November - looks likely to worsen given that Glos plans to raise nuclear power at a cabinet policy summit later this week.

Nuclear power is one of the issues where Merkel's CDU/CSU and Schroeder's Social Democrats bluntly admit in their coalition pact that they are in flat disagreement.

Lars G. Josefsson, CEO of Swedish energy giant Vattenfall, which is Germany's third biggest utility, predicted the mood in Germany over nuclear power would change - and not just because of Russia.

"Climate change is a vehicle. It has already happened in Sweden where a majority of the population again think nuclear power is a good thing," said Josefsson, in a Die Welt newspaper interview, adding that Vattenfall would build new nuclear stations in Germany if the public would accept them.

Projected steep increases in German gas dependency on Russia are another reason energy strategists are giving nuclear power another look.

A planned Baltic Sea gas pipeline linking Germany to Russia, which is due to come into operation in 2010, will be able to supply a staggering 50 per cent of Germany's gas needs.

Referring to International Energy Agency data, Claudia Kemfert, an energy export at Berlin's Institute for Economic Research warned that western Europe could rely on Russia for 70 per cent of its gas by 2020.

"This is naturally absolutely dangerous," she said.

The controversial 4 billion euro project - with Schroeder planning to head its supervisory board - has alarmed Poland and the Baltic states because it deliberately skirts their territories.

Holger Karwinkel, an energy expert at the Federal German Consumer Agency, says the pipeline may turn out to be a big "strategic error".

Karwinkel says it would make far more sense to speed up efforts to build a terminal for ships carrying liquefied natural gas (LNG) which would allow Germany to diversify away from Russia to suppliers such as Nigeria, Egypt and Qatar.

Europe's biggest utility, E.ON AG, has for years had unrealised plans to build an LNG terminal near the German city of Wilhelmshaven, said Die Welt adding that the 500 million euro project is now supposed to go ahead and become operational in 2010.


Subject: German news

0 Comments To This Article