What’s in Germany’s new energy security law
All the consequences on gas supplies and refineries of the new German energy security law. Pierluigi Mennitti's article from Berlin
A new energy security law (Energiesicherungsgesetzes) that will allow the German government to expropriate energy companies in the event of a major emergency. Born as a bill of the executive, the project has already obtained the green light of the Bundestag, with a majority vote that went beyond the perimeter of the governing parties, SPD, Grünen and liberals. To further cover Scholz's back, this time, it was not the conservatives but the left of Linke. For the record, the CDU abstained, the Afd nationalist right voted against.
The law will come into force in June, before the parliament's summer recess, because it requires the favorable vote of the Chamber of Länder, the Bundesrat, since a series of competences also affect the regions. According to government sources, the Bundesrat could give the green light as early as next week.
From June, therefore, it will be possible for the government to intervene on the ownership of energy companies when their inactivity puts the country's energy security at risk. In fact, the government has made more explicit an existing regulation, dating back to 1975 and launched to react to the oil crisis of those years. It allowed, in the event of a crisis, the placing under trust of the companies that manage critical energy infrastructures. In extreme cases, expropriation was already possible. So much so that the Minister of Economy and Climate Robert Habeck (Verdi) had used it a month ago to appoint the Federal Network Agency (Bnetza) as trustee of the German branch of the Russian state company Gazprom. But he had justified the move by identifying unclear legal relationships and a violation of the reporting rules. Now the new law will create a new legal basis for trusteeship independent of the special requirements of foreign trade law.
However, expropriation represents the last resort, to be used only when the safety of energy supplies cannot be guaranteed otherwise. On this point the liberals, always quite refractory to arguments such as nationalization, had stuck, and they have obtained the assurance that direct intervention by the state is temporary and that after a suitable period the nationalized company will be put back on the market.
One of the first applications of the new law could concern the PCK refinery in Schwedt, in Brandenburg, on whose products Berlin also depends: public and private mobility, heating and the activity of the new central Berlin-Brandenburg airport are linked to the activity of the Brandenburg plants , owned by the Russian Rosneft, which holds just over 54% of the shares. The Russian company has taken a step back, declaring that it is also willing to use oil of non-Russian origin, reversing statements to the contrary made a few days earlier. A sign of readiness, the Germans believe, which, however, will have to be verified by the facts.
No one here in Berlin trusts the statements of Russian leaders now. And the plans for Schwedt's nationalization are already in the drawer, ready to be activated when necessary thanks to the new law: either Rosneft will spontaneously give up its majority stake or it will be forced to do so by law.
Another novelty with respect to the 1975 formulation concerns the obligation to notify the Federal Network Agency of any planned decommissioning of gas storage facilities.
These are therefore legislative changes that make the actions already contemplated in the legislation of over forty years ago more expeditious and clearer, and which are now updated to the current commercial contexts. The government had been working on it since the day after the war broke out in Ukraine and many rumors had already leaked out in the past weeks. Nothing secret, so much so that the Ministry of Economy had intervened a few days ago to downsize the emphasis with which Reuters had launched them as an exclusive: the German news agency Dpa itself had talked about it exactly a month ago.
But from June, the law will be useful to address the great fear that now hovers in the Ministry of Economy, namely that Russia will anticipate the moves and play the card to stop gas. A little taste was had just this week, with the announcement from Moscow of sanctions against 31 energy companies in Europe and the United States with which any commercial relationship on gas has been interrupted: ban on transactions and entry into Russian ports for the ships associated with the companies concerned. For Germany, the list published by the Kremlin also included parts of the Gazprom Germany group, the very one that had passed under the trusteeship of the Federal Network Agency, including the gas supplier Wingas, which ensures public utility services and the Astora gas storage operator.
For now, there have been no setbacks and Wingas has assured with a note that its commitments will be maintained despite the blockade of the gas supply imposed by Russia: "To supply its customers, Wingas has returned to using a diversified portfolio and to procure in several European trading points ”, a spokesperson said,“ and therefore customers continue to reliably receive the contractually agreed quantities of gas ”.
The government, for its part, has also made it known that "the security of gas supply is currently guaranteed" and Minister Habeck, in an interview with the weekly Wirtschaftswoche, said he was optimistic that it is possible that Germany will succeed in cope with a possible boycott of Russian gas as early as next winter. "If we have full storage at the end of the year, if two of the four floating tankers we charter are already connected to the grid and we save energy significantly, we can to some extent survive the winter even if gas supplies from Russia failed ”. And in winter, the first floating regasification terminal in Wilhelmshaven, in Lower Saxony, is due to start.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/energia/germania-legge-sicurezza-energetica/ on Sat, 14 May 2022 06:04:31 +0000.