On Wednesday, the federal government announced the activation of the first phase of a contingency plan for possible and future energy shortages: it is designed to prepare the country in the event that Russia suspends gas imports if it fails to find an agreement with the Western countries how to do it paid, a question that has been discussed for days. Germany is one of the European countries most dependent on Russian gas: over half of the gas it imports comes from Russia and it uses it for about a third of its energy consumption.
The emergency plan announced by Federal Minister of Economics Robert Habeck provides for three phases of “early warning”: The activation decided by the government is the first. He plans to set up a crisis team headed by the Ministry of Economic Affairs to monitor gas supplies (so far, German gas storage facilities are 26.5 percent full, the federal government wants them to reach at least 40 percent). 2023). On the side, Habek also called on German citizens and companies to moderate their energy consumption.
In the event that gas should be absent, the other two phases of the plan will be activated, which instead consist in the rationing and redistribution of gas, the interruption of supplies to some production sectors and the prioritization of the structures that need it most, such as Hospitals or private households (in Germany about half are heated with natural gas, in Italy almost 70 percent).
However, Habeck specified that there is currently “no shortage” of gas and that these measures are precautionary measures in the event of a “escalation” by Russia.
The possible escalation that Habeck is talking about concerns the dispute over gas payments between the Russian government and Western countries that has been going on for almost a week. Last week, Russian President Vladimir Putin announced that countries “hostile” to Russia a rather long list of some 40 states, including those in the European Union would be asked to pay for natural gas supplies in rubles rather than euros or dollars . as stipulated in the treaties.
Putin’s goal was to curb the devastating effects of Western sanctions on the value of the rouble: in order to pay in roubles, foreign countries must buy rubles and, by buying them, increase their value, which had plummeted at the start of the war as the ruble fell as a result of the sanctions ( however, there are also many doubts about the real benefit of this step for Russia). It is not yet clear when and how Putin wants to start making payments in rubles: First, Putin had asked the Russian central bank to allow the measure to take effect within a week. Today, instead, the Russian government has specified that the process will not be immediate, always without giving more concrete indications.
Also read: Putin wants countries “hostile” to Russia to pay for natural gas supplies in rubles
However, Western countries do not seem to have any intention of paying for gas in rubles: a position also formalized a few days ago by Habeck, who said on behalf of the other G7 ministers that the countries in the group (Italy , France, United Kingdom, Germany, United States, Canada and Japan) continue to pay for gas in euros and dollars. Habeck reiterated this today, calling Putin’s demand a “breach of contract” on supplies.
However, the Russian government has insisted, replying to the G7 that it has no intention of “delivering gas to Europe for free”. In the expectation that the dispute cannot be settled easily, the federal government has therefore decided to prepare Germany for a possible delivery stop.
According to various experts, the effects of a possible suspension could be serious. Volker Wieland, an economics professor at the University of Frankfurt and an adviser to the German government, told the Financial Times that cutting off Russian gas supplies in Germany would result in a “significant” risk of an economic recession and a further increase in inflation. , ie the increase in prices combined with the decrease in purchasing power.
According to the German Economic Advisory Council, the group of economists formed in 1963 of which Wieland is a member to advise the federal government, if Russia stopped gas supplies, German inflation could reach 9 percent (it is now around 5.5 percent and will expected to increase), making it one of the highest in the European Union.