Several key German industry groups and energy analysts are warning that Germany could face severe gas supply issues, and potentially entirely deplete its storage, if an exceptionally cold winter occurs. Of course, predictions of this sort have been made off and on in recent years. Germany has never actually run out of gas before. The question is now how alarmist these warnings are and how realistic an actual gas and energy shortage is this time around.
Currently, the government argues there will be no gas shortage. However, storage operators, energy executives and some economists argue that a mild winter should be manageable and a brutally cold one could get tight enough to force industry to cut production and send prices soaring.
One of the most dire warnings comes from Markus Krebber, chief executive of RWE, Germany’s largest power producer.
“If we get a mild winter, everything will be fine,” he told Focus in an interview. “If the winter is hard, there can be significantly higher prices. And it can get tight.”
Krebber said Germany is entering the season “with the lowest gas storage levels of the past 20 years” – lower even than in 2022, when Russian pipeline flows collapsed. “That works if we have a normal winter. If we get a particularly cold winter, it can get scarce.”
He has also warned that if Germany does not add more power supply, “there will be distribution battles for electricity” among industry, data centers and the electrification of heat and transport.
The data supports Krebber’s concerns. The German gas storage association (INES) warns that Germany entered September at its lowest storage levels in 15 years, at around 53 to 56 percent. INES models show that if refills remain sluggish and if Germany experiences an extremely cold winter, similar to the weather of 2010, storage reserves could be exhausted as early as January or February, potentially leaving daily supply shortfalls of up to 25 percent.
German underground gas caverns are roughly 20 percentage points below last year’s level and far under the seasonal norm. While Berlin’s own rules call for most gas storage sites to reach 80 percent by Nov. 1, almost no one now expects that to happen.
“By now all the experts agree: these 80 percent are already technically almost impossible to achieve and also not realistic,” Klaus Müller, president of the Federal Network Agency, said in a Phoenix television interview. He added that storage is not the whole story. “We have created our own capacities with four liquefied natural gas terminals. We can obtain gas from Norway, Belgium, Holland, France.”
Energy market consultants and industry group analyses point out that weak summer gas refills – driven by unfavorable price spreads between summer and winter gas and price volatility from global conflicts – have left Germany reliant on steady ongoing imports. They point out that cold weather is not the only factor, as disruptions could be exacerbated by pipeline outages, reduced LNG flows, escalating conflict in Ukraine or the Middle East, and various other scenarios. All of this comes at a time when Germany’s buffer is much thinner than in previous years.
Not everyone is panicking, though. The Federal Network Agency, Germany’s energy regulator, has also acknowledged the low storage levels but stated they do not currently indicate an imminent crisis or inevitable shortage.
Claudia Kemfert, an energy economist at the German Institute for Economic Research, says that a distinction must be made between shortages and higher prices. She has said an acute shortage is not her base case, but that low stocks leave the system more exposed if cold weather, high LNG prices and supply interruptions hit at once. Relying on last-minute cargoes, she has argued, is “risky and expensive.”
Historical weather data supports less extreme gas shortage scenarios. On average, the past ten winters have been extremely mild in Germany, with the exception of last year’s winter, which was exceptionally cold. If there is a repeat this year or the winter is even colder, it could indeed tip Germany into an energy crisis, but the odds appear to be against such a scenario.
In the meantime, industrial companies in Germany are already taking precautionary measures, as a severe cold snap would likely force curtailments on industrial consumers first to stretch remaining gas through February and March to protect vital natural gas deliveries to households.
Another piece of good news it that the European Union as a whole is near 70 percent in terms of gas storage, far better than Germany. This means that the crisis is unlikely to grip all of Europe. Still, Germany is Europe’s largest economy and a key hub of industry. Any gas or energy crisis in the country would have broad repercussions across Europe.
