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KfW to provide € 15 billion in credit to fill gas storage Introduction of an auction system to reduce industrial gas consumption Coal-fired power stations could add 10 GW of power Discussions on the second level of crisis continue – sources
FRANKFURT, June 19 (Reuters) – Germany announced on Sunday its latest steps to boost gas storage levels to prepare for next winter, as it fears Russia, which has cut deliveries in recent days, could reduce or even stop supplies altogether. Following Russia’s invasion of Ukraine, Moscow, which relies on Moscow for most of its gas, is seeking to fill its gas storage facilities and phase out Russian energy imports. The German economy ministry said the new measures would include increased reliance on coal-fired power plants, as well as an auction system that would be launched in the coming weeks to motivate the industry to consume less. read more Sign up now for FREE unlimited access to Reuters.com Register It also includes 15 billion euros ($ 15.8 billion) in credit lines for the German gas market operator, through the state lender KfW (KFW.UL), for the faster completion of gas storage facilities, a government source said. who asked not to be named. Economy Minister Robert Habeck said that depending on the situation, the ministry, which is responsible for security of energy supply in Europe’s leading economy, would take further action. Two people familiar with the matter, speaking on condition of anonymity, said this could include the start of the second phase of Germany’s gas contingency plan. The second phase, which begins when there is a high risk of long-term shortages of gas supply, will allow utilities to pass on high gas prices to customers and thus help reduce demand. read more The German chemical industry association VCI, which represents the sector most exposed to gas supply cuts, said reduced supplies had not yet caused serious problems.
PAINFUL BUT NECESSARY
The measures announced Sunday follow a package unveiled earlier this year to provide energy companies and the German economy with payments to support crisis management in Ukraine, which has led to a sharp rise in electricity costs. “The tense situation and the high prices are a direct consequence of the aggressive war (of Russian President Vladimir Putin) in Ukraine,” Habek said in a statement. “Moreover, it’s obviously Putin’s strategy to make us insecure, to raise our prices and to divide us. We will not let that happen. We will retaliate decisively, accurately and thoughtfully.” The economy ministry said restoring coal-fired power plants to the mix could add up to 10 gigawatts of power in the event of a critical gas supply situation, adding that a similar law would go to the upper house of parliament on July 8th. “This is painful, but there is an urgent need in this situation to reduce gas consumption,” said Habeck, a member of the Greens who has pushed for a faster exit from high-carbon coal. “But if we do not, then we run the risk of not having enough storage space at the end of the year towards winter. And then we are politically blackmailed.” Germany targets storage levels of 80% by October and 90% by November. Data from Gas Infrastructure Europe show German gas storage levels at 57.03% on June 17, up from 29.69% on February 24, the day Russia invaded Ukraine. ($ 1 = 0.9526 euros) Sign up now for FREE unlimited access to Reuters.com Register Report by Christoph Steitz and Andreas Rinke. curated by Barbara Lewis Our role models: The Thomson Reuters Trust Principles.
