Germany is facing some acute energy challenges. Tomorrow Germany’s parliament will hold its first reading on a draft law to regulate exploration for shale gas, a potentially significant new domestic energy source.
“Germany has some of Europe’s most ambitious environmental objectives. But it also needs to ensure a secure supply of energy that enables its industries to remain competitive and consumers to continue heating their homes at an affordable price. In finding a pragmatic solution that strikes an appropriate balance, the forthcoming debate should avoid unnecessary rhetoric” said Marcus Pepperell, Spokesperson for Shale Gas Europe. “There’s no point promoting renewables as the only solution when Germany is consequently having to import more coal to meet demand.”
What are Germany’s energy challenges?
Germany is Europe’s biggest energy consumer, representing 19.3% of Europe’s total energy demand.
Germany has some of the highest electricity prices in Europe, second only to Denmark. This has had a significant impact on its industrial competitiveness effecting jobs and investment.
18.6 million German homes are dependent on gas that also provides industry with approximately 25% of its total energy needs.
Germany’s has ambitious climate change targets. The country aims to reduce its carbon emissions by 80% of 1990 levels by 2050 and increase the share of energy from renewables to 60%.
However Germany will still be dependent on fossil fuels for the foreseeable future, which will still provide 40% of its energy supply in 2050.
As Germany seeks to balance supply against demand, it has become extremely dependent on imported energy. Energy dependency is at its highest in 20 years, rising to 62.7% of its energy consumption in 2013. This is 10% higher than the EU average.
Germany is also using and importing increasing amounts of coal, a more carbon intensive fossil fuel.
The case for shale
Germany holds some of the largest estimated shale gas reserves in Europe – 2.3 trillion m3. This could provide 20% of Germany’s annual gas demand for up to 100 years.
Any shale gas production reduces Germany’s need for more expensive imports. A more secure supply will also ensure it is less vulnerable to external geopolitical factors outside of its control.
Natural gas is also the lowest carbon intensive fossil fuel with a carbon footprint 41% to 49% lower than that of coal-fired plants. Shale gas could therefore work in tandem with renewables by replacing coal, helping Germany continue to reduce its CO2 emissions and meet its climate change objectives.