Germany will significantly increase its use of highly polluting coal to preserve energy supplies ahead of the winter.
The move comes after Russia sharply reduced flows of natural gas in its pipelines to western Europe, driving up energy prices.
The German government said on Sunday it would pass emergency laws to reopen mothballed coal plants for electricity generation and auction gas supplies to industry to incentivize businesses to curb consumption.
The move illustrated the depth of concern in Berlin over possible gas shortages in the winter months.
Federal economy minister Robert Habeck has described Russia’s move to throttle gas supplies last week as “an economic attack” on Germany.
More details of this report from CNBC:
Germany has said the deteriorating gas market situation means Europe’s largest economy must limit the use of natural gas for electricity production and burn more coal for a “transitional period.”
Economy Minister Robert Habeck on Sunday warned that the situation is going to be “really tight in winter” without precautionary measures to prevent a supply shortage.
As a result, Germany will seek to compensate for a cut in Russian gas supplies by increasing the burning of coal — the most carbon-intensive fossil fuel in terms of emissions and therefore the most important target for replacement in the transition toward renewable alternatives.
“That’s bitter, but it’s almost necessary in this situation to reduce gas consumption. We must and we will do everything we can to store as much gas as possible in summer and autumn,” the Green Party’s Habeck said in a statement, according to a translation.
The European Union receives roughly 40% of its gas via Russian pipelines. Russian oil giant Gazprom cut half its supplies to Germany earlier this month, some of which it attributed to ‘technical issues’, though German officials claim it was politically motivated.
European gas prices, already running close to record levels, soared further last week in response to the latest supply cuts.
Rising energy prices are stoking inflation and a cost of living crisis across Europe, which central banks are struggling to address without tipping the region’s economy into recession.
Sources: 100percentfedup, CNBC