Germany announces second phase of energy emergency

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Germany announces second phase of energy emergency

Germany's economic ministry has announced the second of three energy emergency phases, warning that the country faces a high risk of long-term supply shortages due to Russia choking off gas deliveries.

One of the alarms phases of the emergency plan allows utility firms to pass on high gas prices to customers and lower demand.

The ministry said the reduction in Russian gas deliveries was due to a reduction in Russian gas deliveries since June 14 due to continued high prices on the gas market. According to Robert Habeck, minister for economic and energy affairs, the ministry said that if Russian gas deliveries through the Nord Stream 1 pipeline continue to be low as 40%, a storage target of 90% will not be reached by December. Putin's strategy is to drive a wedge through our society, to stir insecurity and drive up prices. He added that even if it doesn't feel like it yet, we are in a gas crisis. Gas is going to be a scarce commodity from now on. The Green Party politician said that the current crisis was a result of the previous German governments having allowed themselves to become too dependent on Russian gas and not sufficiently diversified its energy sources.

That is now coming back to haunt us and needs to be rectified at great speed, Habeck said at a press conference on Thursday morning.

Germany is trying to fill up its gas storage facilities in time for the winter, as Europe's largest economy struggles to get rid of Russian energy supplies in the face of a possible European embargo or a potential decision by Moscow to completely cut off supplies.

In moves that are controversial with the Green Party's voter base, the German government is planning to build two new liquified natural gas terminals on the North Sea coast and restart coal-fired power plants that were due to be phased out.

On June 14th, Gazprom announced that it was reducing deliveries through the Nord Stream 1 pipeline by 40% due to delayed repairs of technical parts by German company Siemens. The economic minister had rallied German industry leaders around his emergency plans on Tuesday, warning them that large companies could face months and days of gas shortages in the coming winter, according to Habeck on Thursday.

If the plan works out, the storage units will be full in winter, he said at a meeting of German DAX companies in Berlin. There is a degree of hope that we can manage this. The units are only 60%, but make no mistake, we are not there yet.