Newspaper Interview with our Honorary Professor Dr. Hans-Wilhelm Schiffer

31/03/2022
 

On March 18th, a newspaper interview with our honorary professor Dr. Schiffer was published in the Aachener Zeitung / Aachener Nachrichten. Against the background of the Russian war against Ukraine, the desire to diversify sources of supply increases. Prof. Schiffer shares his current assessment of the energy supply in Germany.

According to Prof. Schiffer, Russia is the most important supplier of natural gas, crude oil, and hard coal for Germany. An import ban would have different effects on the supply of the individual energy sources. In the case of hard coal, hardly any negative effects would be expected given the flexibility which exists on the world market. Recourse to other suppliers also offers possible solutions for oil. It would be important for states such as Saudi Arabia and the United Arab Emirates to increase their oil production to relax the markets. The situation with natural gas is more difficult. Germany not only imports a lot of natural gas but is also an important transit country for natural gas from Russia and Norway. A stop on Russian gas by Germany would automatically affect the entire EU internal market. Therefore, such a decision would have to be made at European level.

Shutting down the Nord Stream I Baltic Sea pipeline can be seen as an alternative to an embargo. Then, the Yamal pipelines via Belarus and Poland, and "Friendship" via Ukraine and Slovakia would remain. However, according to Prof. Schiffer, this could lead to a complete halt to deliveries by Russia. This would lead to further price fluctuations. On the other hand, this would result in massive losses in Russia's export earnings from natural gas deliveries to the West. Putin would hardly have any alternatives to compensate the corresponding shortfalls by redirecting the supply streams towards Asia, at least in the short term - simply because of the lack of the necessary infrastructure.

According to Prof. Schiffer, the supply of natural gas would still be secured until fall, even if Russia stopped deliveries immediately. As a precaution for the coming winter season, the gas storage tanks must be filled up in the coming weeks and months. The federal government has passed a law on the national gas reserve that regulates the filling of reservoirs. Another important factor is the procurement of liquefied natural gas (LNG) for the supply in Germany. Two LNG terminals could be built in Germany by the mid-2020s. Using so-called floating terminals, however, LNG could also be brought to Germany, regasified and fed into the grid much faster. However, a large amount of the supply will still be provided by pipeline through Norway, Germany's second most important supplier.

The reduction of the demand for natural gas in Germany can occur in the areas of heating and hot water preparation - also as a consequence of the sharp rise in consumer prices for natural gas. According to the Federal Environment Agency, 10 percent of Russian natural gas can be saved by reducing the room temperature by two degrees in residential and non-residential buildings. In the medium term, improved thermal insulation, doing without natural gas heating in new buildings, expanding renewable energies and using green hydrogen can contribute to further reducing the natural gas consumption. There is limited potential for savings and substitution in the industry. According to Prof. Schiffer, it is important to avoid restrictions in the industrial production. In the power generation sector, natural gas can be replaced by increased use of coal. Domestic production of natural gas, which contributes 5 percent to covering the demand in Germany, could be increased by around 5 to 10 percent. In Germany, ecological reservations stand in the way of the increased extraction of natural gas through fracking. The continued operation of the last three nuclear power plants is not a suitable option according to Prof. Schiffer.

You can read the full interview here.