Friday, May 6, 2022

Week-long waiver report sees EU gas targets as hardly achievable

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The EU countries are struggling to become less dependent on Russian energy. How can this succeed? A research center sees only one way to achieve the goals of the European Union.

According to a report, the European Union’s (EU) goals of reducing its natural gas imports from Russia and at the same time significantly filling up the storage facilities by the winter can only be achieved if Europe’s industry does not use gas for weeks. A calculation model by Forschungszentrum Jülich shows that more than 300 terawatt hours of natural gas (around 30 million cubic meters) would have to be saved across Europe this year in order to fulfill an EU plan presented at the beginning of March, reports the “Spiegel” in its new issue.

This amount corresponds to about a third of the annual consumption of the whole of Germany. EU Commission Vice-President Frans Timmermans had stated that the EU member states could forego two-thirds of their gas supplies from Russia by the end of the year and replace them from other sources. At the same time, the states should fill their storage facilities to at least 80 percent of the maximum capacity by November – in order to get through the next winter without Russian gas if necessary.

According to the model calculations of the Jülich Institute for Techno-Economic Systems Analysis, both goals can only be achieved with significant closures of industry, as the “Spiegel” further reported. As a result, all steel mills, chemical plants or cement works in the EU would have to be shut off from gas from now until the end of July – and gas-fired power plants for most of July.

This is the only way to achieve the EU’s interim target of filling 63 percent of the storage tanks by August 1, according to the “Spiegel” model calculations by the Jülich Institute. In October, further caps would therefore be necessary for the industry to reach the 80 percent level by November 1st. All of this applies even under the optimistic assumption that imports of liquefied natural gas (LNG) and pipeline gas from other countries could again be increased significantly.

“If the storage tanks are to be filled according to the planned specifications and at the same time deliveries from Russia are to be cut so severely, this will only be possible with significant restrictions for industry and power plants,” said Jochen Linßen, professor at Forschungszentrum Jülich, the “Spiegel”.

Meanwhile, the German federal government is planning a law that should speed up the construction of import terminals for liquefied natural gas (LNG). In exchange with the environment and justice ministries, the Federal Ministry of Economics has developed a draft law for the acceleration of LNG projects in northern Germany and submitted it to the departmental vote, as the German Press Agency learned from circles in the Ministry of Economics.

View of a liquid gas pipeline at the North Sea Gas Terminal: Schleswig-Holstein's Prime Minister Günther wants a floating LNG terminal to be put into operation in Brunsbüttel at the beginning of next year.  This would require the construction of a 2.5-kilometer pipeline.  (Source: dpa/Marcus Brandt)View of a liquid gas pipeline at the North Sea Gas Terminal: Schleswig-Holstein’s Prime Minister Günther wants a floating LNG terminal to be put into operation in Brunsbüttel at the beginning of next year. This would require the construction of a 2.5-kilometer pipeline. (Source: Marcus Brandt/dpa)

“The aim of the law is to go through all approval and approval procedures as well as the award of public contracts and concessions much faster than is possible under the current legal situation, and thus to achieve rapid approvals and the integration of LNG into the German market,” it says it in a corresponding paper that is available to the dpa.

Specifically, approval authorities should be able to temporarily suspend certain requirements, such as environmental impact assessments, under certain conditions. The law will apply to floating and land-based LNG import terminals, which are expected to be approved and commissioned more quickly. For both variants, infrastructural requirements would also have to be met, for example they would have to be connected to the natural gas pipeline network and some port facilities would have to be adapted.

Germany wants to become less dependent on Russian natural gas. The gas supply freeze for Poland and Bulgaria initiated by Russia last Tuesday has also fueled fears of such a sudden step in Germany. There are currently concrete plans for LNG terminals for Stade, Wilhelmshaven and Brunsbüttel, among others.

The German gas emergency plan stipulates that customers such as private households or social services such as hospitals must be given priority. Savings could therefore only be made by companies that need gas for their production or as fuel for power plants.

Business representatives are calling for private end users to be switched off if necessary. Eon supervisory board chairman Karl-Ludwig Kley demands, for example, that the industry must be given priority.

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