Germany to take energy steps; gas to reach Hungary

Berlin, June 19: Germany will take emergency measures to ensure it meets its energy needs after the drop in supply of Russian gas, including increased use of coal, the government said in a statement on Sunday.

On the other hand, Russia has promised to continue gas shipments to Hungary and that Gazprom will fulfil its contractual obligations to the country, Foreign Minister Peter Szijjarto said.

“To reduce gas consumption, less gas must be used to generate electricity. Coal-fired power plants will have to be used more instead,” the German economy ministry said.

The move follows a warning by Russian energy giant Gazprom last week that it would sharply cut deliveries to Europe.

Gazprom said the supply reductions via the Nord Stream pipeline are the result of repair work, but EU officials believe Moscow is punishing allies of Ukraine, where Russian forces launched an invasion in February. “It’s bitter but indispensable for reducing gas consumption,” economy and climate minister Robert Habeck said. The measures also include an “auction” system for the sale of gas to manufacturers, which, according to the government, will help bring down consumption by the powerful sector.

In Russia’s response to Western sanctions since its invasion of Ukraine, energy giant Gazprom has cut supplies to Denmark’s Orsted (ORSTED.CO) and to Shell Energy (SHEL.L) for its contract to supply gas to Germany.

It also cut supplies to Dutch gas trader GasTerra along with Bulgaria, Poland and Finland for refusing to make payments for Russian gas in roubles. Szijjarto said that Gazprom CEO Alexey Miller and Russia’s deputy PM Alexander Novak had assured him that the company would fulfil its obligations towards Hungary.

So far, Berlin has managed to reduce the share of its natural gas supplied by Russia from 55 per cent before the invasion to 35 per cent.