Germany, Europe’s largest natural gas user, will continue to be at risk of supply shortfalls for the next four years until additional gas storage capacity and LNG terminals can be placed online, according to the country’s gas storage system operator.
System operator Initiative Energien Speichern eV’s (INES) forecasters plotted outcomes for “normal, warm and cold temperatures” during the 2023-2024 winter season in its latest gas scenario report. Despite more than a year of mandated reductions in gas consumption, Germany in 2024 could face a supply gap under the cold temperature scenario of 7 TWh in January, 15 TWh in February and 12 TWh in March.
The “risk of a gas shortage in cold temperatures still exists and will probably continue to accompany us until the 2026-2027 winter without further infrastructural measures,” said INES Managing Director Sebastian Bleschke. “Only reduced gas consumption would reduce the need for building additional storage or LNG import facilities.”
INES represents over 90% of German gas storage capacities and accounts for about 25% of gas storage capacity in Europe.
Germany currently has three operating floating storage and regasification units (FSRU) in Brunsbettel, Lubmin, and Wilhelmshaven. The FSRU in Brunsbettel is planned to transition to an onshore facility by the end of 2026. More FSRUs at Mukran, Stade and Wilhelmshaven are expected to add additional liquefaction capacity for the upcoming 2023-2024 winter. An onshore import facility is planned for Stade in 2027.
Last year, the German government asked for a 20% reduction in gas consumption to ensure Germany’s gas security. There was sufficient gas supply over the mild 2022-2023 winter season as Germany's storage sites reached 100% capacity by mid-November.
Germany is the largest gas consumer in Europe, with over 90 billion cubic meters (Bcm) consumed in 2021, dropping to nearly 78 Bcm last year. Germany was previously the largest importer of Russian gas, which once met over 50% of the country’s supply requirements.
According to government data published in January, Germany has consumed much less gas since 2022. Gas consumption last year fell by 14%, compared to the four-year average.
Germany requires gas storage facilities to be filled to 75% of capacity by Sept. 1, 85% by Oct. 1 and 95% by Nov. 1.
Although storage levels are nearly 90% or more full, INES said German gas demand during the upcoming 2023-2024 winter “could probably not be met” if there are extremely cold temperatures during the upcoming winter months.
The U.S. Federal Reserve said in an August report on Europe’s potential gas shortages for the 2023-2024 winter season that “while Europe is in a good position to get through next winter without major disruptions, it remains quite dependent on natural gas imports.”
The Fed encouraged “securing long-term import contracts, continuing to build import and storage infrastructure, and lowering gas consumption through energy efficiency and energy substitution.”
