An alternative to Russian gas?

In many industrialized countries, natural gas is one of the most important fossil fuels – as a supplier of heat, for generating electricity or sometimes as a fuel. Around 86.5 billion cubic meters of natural gas were consumed in Germany in 2020. Consumption is particularly high in winter, when there is a lot of heating.

In Germany, most of the natural gas is imported via pipelines from Russia, Norway and the Netherlands. Russia is Germany's most important energy supplier: According to the Federal Ministry of Economics and Technology, Germany gets more than 50 percent of its natural gas imports from there.

37 LNG terminals across Europe

But pipelines are not the only way the gas can get to Germany and Europe – another way are transport ships that bring gas to Europe in liquid form, i.e. as LNG (Liquified Natural Gas). In LNG terminals, the liquid gas is pumped out of the transport ships. It can then be used as a liquid fuel for ships, with LNG having the advantage of low CO2 emissions. The alternative is that by heating it, it becomes gaseous again and fed into the gas network.

According to the Federal Association of Energy and Water Industries (BDEW), there are currently 37 LNG terminals across Europe. "In Europe there are relatively large LNG import capacities, which cover around 40 percent of European gas requirements," explains independent energy expert Hans-Wilhelm Schiffer when asked by tagesschau.de. 26 of these terminals are in EU member states. According to the EU Commission, LNG covers around 25 percent of the demand here.

"Thanks to new production methods such as fracking and the worldwide development of new gas deposits, LNG has developed enormous momentum and already covered 19 percent of the EU's natural gas requirements in 2019 – almost twice as much as just a few years ago," says KfW Research "Importance of the EU natural gas imports for reaching the climate goals" from the past year. Since then, liquid gas has gained in importance, not least because of the Ukraine conflict and the empty gas storage facilities in Germany. Because there is a risk that Russia could use natural gas as a means of exerting political pressure.

Producing countries USA, Australia and Qatar

The natural gas, which is then sent around the world as LNG, is produced primarily in the USA, Australia and Qatar: "An LNG export infrastructure is being massively expanded, particularly in the USA, which will become the largest LNG exporter in the world by 2024 could," writes KfW in its report. "There, in particular, many producers are able to expand their supply at short notice in order to react to fluctuations in demand," explains the BDEW when asked by tagesschau.de. This also means that the LNG tankers can be used relatively flexibly to bring the liquefied gas to where it is needed.

For example in the EU: "The utilization of the LNG terminals in northwestern Europe has increased significantly since December," reports energy expert Schiffer. This is due to the high gas prices in Europe, which are now well above the prices for LNG deliveries. Because up to now, LNG has always been more expensive than gas, which comes to Europe through pipelines, due to the complex transport process.

According to Schiffer and the Federal Ministry of Economics, even more LNG can be transported to Europe, even if the LNG terminals are unusually busy. "The utilization of LNG terminals across Europe is currently 71 percent. That is a very high proportion that we have not seen in the past," said a spokesman for the Federal Ministry of Economics at a press conference.

Germany does not have an LNG terminal

Although Germany has the highest natural gas consumption in an EU comparison, there is still not a single LNG terminal on the territory of the Federal Republic. A direct import of the liquid gas is not possible. German energy suppliers who want to use LNG have to deliver the liquefied gas to terminals in Zeebrugge (Belgium), Dunkirk (France) and Gate (Netherlands) and have it heated up.

There have been plans for years to build LNG terminals in Germany as well – specifically, these are plants in Brunsbüttel and Stade. Chancellor Olaf Scholz also supports the project: "In any case, he takes the position that the Federal Republic of Germany should also have one or more LNG terminals," the Chancellor said at the beginning of February through his government spokesman. But there are still no political regulations. "More than ten years ago, Germany would have been better off building a liquid gas terminal than a direct pipeline to Russia," DIW energy expert Claudia Kemfert recently complained to tagesschau.de, referring to the current bottlenecks.

"Germany is not competitive"

Hanseatic Energy Hub GmbH, which has the gas infrastructure operator Fluxys (Belgium), the Partners Group (Switzerland) and the Buss Group from Hamburg as shareholders, wants to build an LNG terminal in Stade by 2026. According to the company, the terminal could cover up to ten percent of Germany's gas needs.

However, the company in Germany is confronted with a number of challenges: "Despite the sharp drop in European funding, Germany has not further diversified its sources and has no access to the global gas market that has emerged in recent decades," said a spokeswoman at the request of tagesschau. de with While neighboring countries have been expanding their infrastructure for LNG imports for years, Germany has only relied on imports via pipeline: "Germany is currently not competitive as a location for an import terminal. There is no set of rules that gives investors security in the urgently needed to invest in import terminals."

But even if politicians now present a corresponding set of rules, the terminals in Stade and Brunsbüttel will only be ready for use in a few years. It is therefore also clear that LNG could not compensate for an import stop of Russian natural gas, according to energy expert Schiffer: "Russian deliveries of natural gas are so significant that both the capacities at LNG import terminals and those from other natural gas exporting countries via LNG The natural gas quantities to be made available would hardly be sufficient to compensate for a complete loss of Russian supplies." According to Schiffer, the availability of the gas quantity, the transport capacities of the ships and the capacities of the plants in the producing countries also play a role.