Et was a time when the whole of Germany was squinting at the levels in the gas storage tanks. The otherwise stable supply suddenly seemed endangered because the Russians were sending less and less gas to Germany and eventually no gas at all. In June of last year, the Federal Network Agency declared the emergency plan “alert” because the supply situation had “deteriorated significantly”. Her boss Klaus Müller warned all over the country that things could get tight if the Germans didn’t do their best to save gas. The federal government forced operators to store gas, which caused prices to skyrocket. There was long and serious debate about which consumers would be rationed if the market collapsed.
Now it is clear that the efforts of the Germans have borne fruit. The gas price falls and falls and, at EUR 36 per megawatt hour, has reached its lowest level in almost two years (apart from a small dip in November). The gas storage facilities are also well filled at 67 percent. But the relaxed situation is not only due to the mild temperatures, but also to the massive savings made by industry and households. This is the result of a new study by the Center for Sustainability at the Hertie School in Berlin, which was presented to the FAZ in advance and published on Thursday in the Journal “Nature Energy” has appeared.
Market prices effective way to save gas
Accordingly, gas consumption fell by 23 percent in the second half of the year. That is “significantly more” than he and most other experts had expected at the beginning of the study, says researcher Oliver Ruhnau, who wrote the study together with Clemens Stiewe, Jarusch Müßel and Lion Hirth. The authors use a multiple regression model that controls for factors such as weather, general economic trends, seasonality, and more, and compare actual consumption to a hypothetical benchmark.
In view of the higher prices, the industry began to reduce its gas consumption by 4 percent as early as September 2021. That figure rose to 27 percent in October. Households and small businesses, which only later reach the higher wholesale prices via the energy suppliers, reduced their consumption by 10 percent shortly after the outbreak of war in March 2022. The savings rose to 28 percent by September. The winter of 2022/2023 was one of the warmest in Germany since weather records began. Co-author Hirth concludes from the results that market prices are an “effective means” of creating incentives to save gas, especially in industry. However, these would have to be supplemented in a meaningful way. “Support measures and relief packages are necessary to cushion hardship. However, these should be designed in such a way that the incentives to save gas are maintained,” Hirth continues.
Network agency remains vigilant
The relaxed situation on the gas markets is not yet reflected in the prices that consumers pay for gas. As the comparison portal Check24 reports, heating costs are currently higher than ever, despite the gas price brake. According to this, a model household that heated its terraced house with gas paid an average of 2406 euros in the current heating period – 12 percent more than in the same period last year. Without the gas price brake and taking over the December discount, it would have been 2904 euros. However, the portal announced that there are cheap offers for new customers who benefited from the significantly lower wholesale prices.
And the Federal Network Agency remains vigilant. The supply is stable, but the “preparation for winter 2023/2024 remains a key challenge,” she writes in her weekly management report. Economical gas consumption remains important. In order to secure the gas supply for the coming winter, a storage level of 75 percent must be reached by September 1st.
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