European Union ministers agreed on 26 July to ration natural gas supplies this coming winter to protect member states against further supply cuts by Russia.
Energy ministers approved a draft European law meant to lower demand for gas by 15% from August through to March. It is a compromise that includes deals to limit the cuts for the hardest hit countries. The new legislation entails voluntary national steps to reduce gas consumption and, if they yield insufficient savings, a trigger for mandatory moves in the whole of the EU.
European Commission president Ursula von der Leyen welcomed the move, saying in an official statement that “the EU has taken a decisive step to face down the threat of a full gas disruption by Putin.”
On 25 July Gazprom announced that it intended to limit supplies to the EU through the Nord Stream 1 pipeline to 20% of capacity. On 21 July gas had started to flow through the pipeline from Russia to Germany at 40% capacity, following a 10-day closure for annual maintenance work. This restricted utilisation brought a strong reaction from Germany’s economy and climate minister Robert Habeck. “[This action] speaks a clear political language” and confirms that Germany “cannot rely on deliveries”, he said. Gazprom’s action gives rise to concerns that the pipeline is to be used against to EU for reasons of political persuasion. Germany’s response on 22 July was to step up preparations for gas emergency stage 3, which would involve the government taking over as the national energy supply co-ordinator, and taking measures likely to include bringing online mothballed lignite power plants from the emergency reserve. The reserve currently includes 1.88 GW of lignite capacity.
- The German government has agreed to take a 30 % stake in Europe’s largest Russian gas importer Uniper to save it from bankruptcy caused by skyrocketing prices. “The company is of paramount importance for the economic development of this country, for the energy supply of citizens and many firms” said chancellor Olaf Scholz. He said that said the government would provide public loans of up to €7.7 billion in bonds and increase to €9 billion an existing €2 billion credit line from state-owned development bank KfW.
Uniper’s majority owner, Finnish utility Fortum, whose stake will be reduced from 80% to 56% by the bale-out, has agreed to the plan.