When Vladimir Putin closed the gas taps to Europe, Germany feared a winter plagued by blackouts more than anyone.
The authorities German companies rushed to secure alternative supplies, aware that the heavy reliance on Russian gas had left Europe’s economic engine woefully exposed.
However, just a few months later the lights shine in the Christmas markets, a timid optimism is breathed in the air seasoned with Glühwein (mulled wine). The strategy that Germany has hastily assembled to get by without Russian gas seems to be working, at least for now.
“Energy security for this winter is guaranteed”, said Social Democratic Chancellor Olaf Scholz in the German Parliament on Wednesday.
Looking for other suppliers
The country’s gas tanks are full, in part, due to a frantic -and expensive- purchase operation in the markets of hydrocarbons.
Also, on the windswept German North Sea coast, engineers have just built, in a record time, its first liquefied natural gas (LNG) import terminal.
LNG is a natural gas that is cooled in liquid form to reduce its volume and facilitate its transport. It is then converted back to gas upon arrival at its destination.
In Germany this type of project usually takes years, due to heavy bureaucracy. However, the authorities have eliminated procedures so that the work could be completed in less than 100 days.
The most important part of the terminal, a “floating storage and regasification unit” (FSRU) , has not yet been insured. The FSRU, which is essentially a specialized ship in which LNG is converted back to its gaseous state, will be rented for US$ 200.259 daily.
In a few weeks, Tankers from countries such as the US, Norway or the United Arab Emirates could start delivering their cargoes to the port of Wilhelmshaven.
The operator of the terminal, Uniper, which is now controlled almost entirely by the German government, has not wanted to disclose its suppliers, but insisted that contracts are already in place.
Berlin plans to build another 5 LNG terminals. Most should be finished next year.
A race against the clock
The powerful German industry has held its breath while the government executed its risky strategy.
“Yes we don’t have gas, we have to close the kiln”, Ernst Buchow, who owns a brick factory half an hour from Wilhelmshaven, told the BBC.
The bricks it produces must be fired in a giant oven at temperatures up to 1.100 degrees Celsius. In the near future, the businessman hopes to be able to switch to green hydrogen, but for now, he is totally dependent on gas.
“It’s not just the politicians’ fault. The industry wanted the Russian gas contracts”, he added.
Just a year ago, the agreements with Moscow provided Germany 57% of the gas it consumed, largely part through the Nordstream gas pipeline.
Despite significant political and citizen opposition, the government hoped to put the controversial Nordstream 2 into operation, which would have doubled the amount of Russian gas reaching Europe via Germany. However, the invasion of Ukraine buried these desires. manages without Russian fuel.
But, to avoid shortages during the winter, your experts say that the LNG terminals should come online at the beginning of the next year and that gas consumption should be reduced 20%.
Getting to this point can be considered a great national achievement, but it has not come for free.
The hidden and ugly face
Germany, an economic heavyweight, often gets what it wants. But their newfound appetite for LNG is intensifying global demand.
And that can put poorer countries like Bangladesh and Pakistan in a vulnerable position.
“There are a lot of countries, especially emerging economies, that are out of the market and can no longer supply themselves with the LNG they need, because they have less purchasing power than Germany” , affirmed Professor Andreas Goldthau, from the Willy Brandt School of Public Affairs.
The expert warned that this places these nations at greater risk of suffering blackouts or having to resort to “dirtier” energies such as coal precisely to avoid this scenario.
And that What about Germany’s plans to complete its transition to a green model? LNG is, after all, a fossil fuel.
Everyone involved in the Wilhelmshaven project is quick to insist that LNG is a “transition” fuel.
Uniper has promised to build an infrastructure to handle the green hydrogen along with the LNG terminal.
This has fueled the ambitious plans of the Wilhelmshaven city council. The mayor, Carsten Feist, has ensured that the LNG terminal will not bring many jobs to the city. But that his plans to create a green energy center will.
“A large part of the energy transformation that we need for our planet to have a habitable climate in 50 either 94 years, much of which is necessary in Germany, it will take place in and through Wilhelmshaven”, the official asserted.
Large bill
But the most striking cost of Berlin’s strategy to cut its dependence on Russian gas is the monetary one.
The 6 terminals of LNG have forced the German government to spend US$ 6.217 millions. That is more than double what ministers had initially budgeted for and may go even higher next year.
Germany learned too late the value of a secure energy supply and is now paying for it, and dearly.
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