Fearing a Russian gas cut, Germans prepare for a cold winter | Germany | In-depth news and reporting from Berlin and beyond | DW
Many tenants in Germany these days receive unpleasant letters. As energy prices rise dramatically, landlords and property management companies are increasing the monthly flat rate for heating costs. A housing company in Berlin announces a 100% increase in heating prices for apartments heated with gas or oil.
It is not clear if this will be enough. High energy prices have a delayed effect as down payments are not offset by actual costs incurred by the end of the year.
The GdW, an association which represents 3,000 housing companies, has calculated that each household should budget up to €3,800 ($3,870) more for energy in the coming year.
Potential social unrest
This represents a real problem for people with low and middle incomes, warned an association of housing cooperatives in the Land of Saxony. “We are talking about family livelihoods. Politicians need to finally understand this,” he said in a statement.
It’s not just rising energy prices that are weighing on people. Inflation affects almost everything. German Chancellor Olaf Scholz has already made it clear that no state in the world will be able to absorb the impending avalanche of costs. “We will not be able to subsidize all the prices”, underlined the Chancellor. Meanwhile, Economy Minister Robert Habeck has been urging Germans to save energy for weeks.
Germany’s largest real estate group, Vonovia, plans to reduce the default temperature in gas-heated buildings to an ambient temperature of 17 degrees Celsius (62.6 F) at night, which it says will reduce consumption by 8 %. During the day, heating will continue as usual. The hot water supply will not be affected and there will be no restrictions on showering or bathing, he added.
But things look different in Dippoldiswalde. In this small town in Saxony, a housing cooperative recently informed its tenants that in future there will only be hot water in the early morning, at noon and in the evening. The inhabitants were told: “As already announced at the general assembly, we now have to save for the winter.”
It sparked a heated discussion on social media. Federal Construction Minister Klara Geywitz was quick to call the restrictions illegal. The German Tenants’ Association also pointed to the lack of hot water as a reason for rent reduction.
The affected housing co-op refuses to be discouraged. The tenants have shown great understanding, said a council member. He said he was happy to have started a debate, even though the company was now the victim of online abuse. “People are already one step ahead of the politicians in Berlin,” the board member told the DPA news agency.
The Nord Stream 1 gas pipeline will be stopped for maintenance
Gloomy view of Nord Stream
At the Economy Ministry, the air conditioning was turned off weeks ago, and less heating will be used in the fall. It could also be done in state-level ministries and other government agencies, Minister Habeck told the Bundesrat, the parliamentary chamber that represents German states, on Friday.
The fact is that Berlin’s dependence on Russian gas has long been underestimated. Most of it goes through the Nord Stream pipeline, which transports natural gas through the Baltic Sea directly to Germany. In 2021, the share of Russian gas supplies was 55%; currently it is 35%, according to the Ministry of Economy.
Russia has drastically cut supplies, citing a missing gas turbine from German company Siemens that is being repaired in Canada but stuck there due to Russian sanctions.
Nord Stream will be completely shut down for maintenance on Monday. Will the Russians restart the gas pipeline after the planned 10 to 14 days? “If the turbine comes after the repair, then it will allow an increase in volume,” assures the Kremlin, before insisting that Russia does not use its gas as a means of political pressure.
Economy Minister Robert Habeck explained how gas reserves will be depleted
No gas in winter?
This is exactly what the German government fears. In Berlin, we hope for the best but we prepare for the worst. Laws are already being passed to mitigate the consequences of the shortage and the impact of rising energy prices.
The Energy Security Act states that in future more coal-fired power plants can be used to generate electricity instead of gas-fired power plants so that gas can be used for heating. Previously, coal had to be reduced regularly in the interests of climate protection.
On the other hand, it will be easier for energy companies in difficulty to obtain federal assistance. One of them is Uniper: since mid-June, the energy supplier, which depends more than any other on Russian gas supplies, only receives 40% of the gas contractually guaranteed by Russian Gazprom and has had to procure replacement quantities at higher prices on the world market.
This has left the company in a financially precarious situation, which is why Uniper has now applied for financial assistance from the state. There is talk of a state subsidy of 9 billion euros, similar to the money paid to the airline Lufthansa at the height of the coronavirus crisis. When Lufthansa recovered, the government was able to resell the shares and even make a profit.
The main gas supplier Uniper has already suffered a lot
Is a serious economic crisis looming?
The number of utilities in financial difficulty is growing almost daily.
“Our country could be heading towards the worst economic crisis since the founding of the Federal Republic of Germany,” said Friedrich Merz, leader of the largest opposition party, the center-right Christian Democratic Union (CDU). , which was Germany’s ruling party for 16 years until the new government was sworn in in December. Merz said Germany was experiencing its highest inflation rate in 30 years and added that for the first time in decades the trade balance is tipping so that the country imports more goods than it uses. exports it. German companies are at risk of losing international competitiveness, he concluded.
In a study published at the end of June, the economic research institute Prognos looked at the consequences of a complete shutdown of Russian gas supplies, meaning that Germany would have to make do with supplies from other countries. country and gas volumes it has already stored for Date.
The study found that after four weeks there would not be enough gas for everyone. Since, by law, private households, social services and district heating providers would continue to be supplied, the shutdown would mainly affect industry. Sectors such as steel, raw iron, chemicals and glass would be particularly affected, with production expected to fall by around 50%.
And the whole economy would be affected. Prognos estimated that in the event of Russian gas supplies, Germany’s economic output could fall by 12.7% by the end of the year.
This article was originally written in German.
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