The German Ministry of Economy, which is in charge of security of energy supply in Europe’s largest economy, said the new measures would include greater reliance on coal-fired power plants, as well as an auction system that will start in the coming weeks to incentivize the industry to consume less. It also includes 15 billion euros in credit lines for Germany’s gas market operator, through state bank KfW, to fill gas storage facilities faster, said a government source, who asked not to be identified.
Economy Minister Robert Habeck said that depending on the situation, the ministry will take further action. Two people familiar with the matter, who spoke on condition of anonymity, said that could include the launch of the second phase under Germany’s gas emergency plan.
The second phase, triggered when there is a high risk of long-term gas supply shortages, would allow utilities to pass on high gas prices to customers and thus help reduce demand.
The measures announced on Sunday follow a package unveiled earlier this year to provide Germany’s energy companies and economy with support payments to manage the Ukraine crisis, which has led to rising energy costs.
“The tense situation and high prices are a direct consequence of (Russian President Vladimir) Putin’s war of aggression against UkraineHabeck said in a statement. “Furthermore, it is clear that Putin’s strategy is to make us insecure, raise prices and divide us. We will not let that happen. We will fight back with determination, precision and consideration.”
The Economy Ministry said bringing coal-fired power plants back into the mix could add around 10 gigawatts of capacity in the event of a critical gas supply situation, adding that the relevant law would go to the upper house of parliament on July 8. “That is painful, but it is an absolute necessity in this situation to reduce gas consumption,” said Habeck, a member of the Green Party who has pushed for a faster exit from carbon-intensive coal.
“Gas storage facilities need to be filled by winter. That is the top priority,” he said, referring to targets for storage levels of 80% for October and 90% for November.
The data from Gas Infrastructure Europe show that Germany’s gas storage levels were 57.03% on June 17, down from 29.69% on February 24, the day Russia invaded Ukraine.
Source: Ambito
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