Germany?s Electric and Gas Suppliers Look toward Canada
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Germany?s electric and gas suppliers always seem to be making energy headlines. As an alternative energy leader and with all the nation?s sweeping energy reforms, the nation?s traditional and alternative electric and gas suppliers have had a lot to deal with?and rather quickly at that. Since 2011 when Germany declared its plans to abandon nuclear in the wake of the Fukushima disaster in Japan, the energy industry has been awash with change?and much of it good. Most recently, for example, Germany made headlines when it announced it would reduce its dependence Russia?s Gazprom and increase ties with Canada.The Problem with Gazprom
Gazprom is Russia?s state-owned gas supplier and, according to Forbes, ?provides enormous amounts of energy to both Eastern and Western Europe? while fueling its own needs too. The state-owned every giant has been viewed in Europe, however, as monopolistic and Germany is hardly the only nation to desire a reduction in dependence. Recently Lithuania has also made plans to increase liquefied gas imports rather than rely completely on its energy-powerful neighbor.
Experts aren?t entirely sure about how much money Gazprom funnels into the Kremlin, but they are fairly sure that ?its profits are clearly quite sizable and this money clearly helps bolster the government and keep the Russian economy afloat,? according to the Forbes report. Yet until recently with the boom in shale gas and increased production of alternative energies, Russia has been, more or less, like the gas industry god father and generated no small amount of resentment when it comes to high rates?rates which few other nations could negotiate down. Essentially, Europe could count on Gazprom, as Forbes notes, to be both non-transparent and unpredictable. Consequently, nobody is really shocked that Gazprom?s international customers would be willing to dump the utility giant when a better offer came along.
Oh Canada
For Germany, that better energy offer comes from the ?the Canadian company Pieridae Energy,? according to RT. According to a new deal, ?will supply five million tonnes of liquefied natural gas (LNG) to Western Europe for an unspecified several billion euros,? according to the RT report. While Germany isn?t abandoning its Gazprom imports entirely, it does reduce the nation?s reliance on Russia. Germany has stated that the high cost of German gas has led to losses for its own electric and gas suppliers. Now, Germany has a better handle on energy stability since its energy base will be far more diversified.
The Project?s Launch
Germany?s largest energy provider E.ON will begin importing gas from the Canadian company by 2020. According for the Centre for Eastern Studies, the contract involves ?the purchase of 6.5 billion m3 of liquefied natural gas (LNG) a year for 20 years beginning 2020. This volume amounts to 7% of Germany?s annual gas consumption?. The overall deal, according to the centre, will be ?the first contract in history for supplies of such large volumes of gas from North America to Europe.?
The Dynamic Energy Market in Europe
Supplies of LNG and shale gas are transforming the energy sector in Europe. Gazprom is one of the major energy players on the continent so it?s not surprising that is has a tremendous amount of change in store. Some of the change, of course, may be due to its own practices. As the Forbes writer pointed out, given the fact that it was the same distance, through similar pipeline, and the same product?why was Gazprom charging the Czech Republic thirty percent more that product than Hungary, for instance? Price gaps are just one of the reasons why many nations are looking to secure their energy from other sources just as Germany has.
The market is also waiting to hear whether France will lift its ban on shale gas exploration and fracking?a development that could also impact the energy dynamic. Additionally, the UK is exploring its own shale stores and coming to grips with a new energy future. Put simply, Europe?s energy scene is in flux and major developments seem to be occurring on a monthly basis. Experts also say that renewable energies are increasing at a fast rate in many nations which is going to impact the energy trade in one way or another. For now, Germany is readying itself for a new energy partner and the Canadians are happy to have the honor.
About author: Laura Ginn
?Laura Ginn understands the controversy and debate surrounding fracking as a means of producing cheaper electric and gas. If you are searching for energy saving tips, uSwitch has lots of helpful money saving advice on offer.
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