German govt must present plan on future gas needs - think tank

[CLARIFICATION: It is not just Agora Energiewende which says LNG expansion plans are oversized. The grid operators in their draft plan state that if all planned LNG capacity is realised (LNGplus A scenario), this would be more than is necessary for the supply of Germany and neighbouring countries, and reject such a scenario. Agora Energiewende highlights this in its opinion and says it supports scrapping such a scenario.]

The German government must present a plan on the country’s future gas demands, think tank Agora Energiewende wrote in a position paper on the updated network development plan of the gas network operators. The think tank said Germany is heading for an import overcapacity of liquefied natural gas (LNG), and should therefore present a plan for the future need of the fossil fuel and its phase-out. This would ensure transparency and reduce expansion to a realistic level. Gas network operators are currently analysing how LNG will affect the gas supply up until 2032, but if all registered plans are realised, more LNG could come into Germany than is needed, the grid operators write in their draft plan, and reject such a scenrio. Agora Energiewende head Simon Müller criticised some of the assumptions by network operators, for example that they are expecting only a 20-percent decline in gas use by 2032 (compared to 2021). "Our analyses clearly show that in order to achieve climate protection and energy security, demand must fall by at least one third by 2030 compared to 2021," he told Table.Media. He called on the government to present a comprehensive plan for future gas needs.

According to Agora Energiewende, the network operators' plan should be reworked to address three key points: an overestimated gas demand, especially in view of current developments and the targets set out by the coalition agreement; the improbability of simply replacing LNG with hydrogen, as demand for gas will decrease with the electrification of many sectors; and the risk of LNG overcapacity, with underutilisation of the terminals from the middle of the decade. Economy minister Robert Habeck had said Germany will also supply neighbouring countries with gas, justifying the LNG import capacity expansion. “If we only take a national view, we are making a double mistake,” he told the Tageszeitung (taz). “We must not fail to recognise that other countries supply us, and we must not fail to recognise that we also have to supply other countries.” Germany is going full steam ahead in supporting the build-up of the country’s own LNG import infrastructure, with two floating terminals having gone online in record time. The government pushed this buildup, because pipeline gas flows from Russia stopped last summer, due to the fallout of Russia's war against Ukraine.