Is the emergency coming? Should Russia stop supplying gas completely, German industry faces hard times. However, researchers are confident that the worst can be avoided.

What happens if Putin really turns off the gas tap completely? German industry is concerned about the multi-day maintenance of the Nord Stream 1 pipeline starting this Monday. Then no more gas should flow to Germany through the last most important connection for Russian natural gas.

The reason for this is annual maintenance work. But Economics Minister Robert Habeck (Greens) has expressed concerns that it cannot just be a temporary shutdown. Because the Russian state-owned company Gazprom had already reduced the delivery volume from Russia to Mecklenburg-Western Pomerania significantly in June.

Russian gas deliveries via other pipelines to Germany have also recently declined. And several European countries are no longer getting gas from Russia. But how is Germany supposed to get through the winter without Putin’s gas?

Chemical industry badly affected

In the energy-hungry chemical and pharmaceutical industries in particular, concerns about a gas shortage are great. According to the Chemical Industry Association (VCI), the sector is the largest German gas consumer with a share of 15 percent. It needs gas as a source of energy and as a raw material for further processing in products – such as plastics, medicines or fertilizers. Gas prices are currently “breathtakingly” high, said VCI President Christian Kullmann on Wednesday. In order to remain able to deliver, the industry is stocking up on stocks in order to be able to continue to supply customers in the event of a crisis.

“We are preparing for a throttling or even a cessation of gas imports,” said VCI Managing Director Wolfgang Große Entrup. The companies in the south and south-east of Germany would suffer first because of the pipeline system. In the north and west, on the other hand, supply via ports is easier.

Preparations for emergencies have long been underway in companies. Martin Brudermüller, head of the world’s largest chemical group BASF, described the consequences of large failures back in April: Production at the largest site in Ludwigshafen must be reduced or shut down completely “if the supply falls significantly and permanently below 50 percent of our maximum natural gas requirements”.

The pharmaceutical and specialty chemicals group Merck is now preparing to continue controlling production at its European sites with a reduced amount of gas. “For example, we can partially convert some production processes to liquid fuels,” said the group. But that would be significantly more expensive. The primary goal is always to supply patients and partners with vital medicines and critical products.

Steel sector: only partially flexible

At the steel group ThyssenKrupp Steel Europe there are only very few possibilities to save gas during production, as a spokesman says. A switch from natural gas to oil or coal is also not possible or only possible to a negligible extent. “Restrictions in supply are also associated with restrictions in production, but we can implement them up to a certain threshold.” However, a minimum purchase is essential to maintain production. Otherwise shutdowns and technical damage cannot be ruled out.

The gas supply in Germany is currently still stable. In the event of a shortage, however, industry would be the first to be affected. On the other hand, private households, public institutions and the healthcare industry with hospitals, for example, are considered protected.

If the energy is not enough for all consumers, particularly sensitive areas would have to be preferred, emphasizes the Dax group Fresenius, which operates the Helios clinic chain. “This includes our hospitals as part of the critical infrastructure.” Fresenius prepared for a gas shortage. “This includes our own initiatives to stock our facilities, develop alternative energy sources and use energy even more efficiently.”

Research remains optimistic

But how high is the risk of a gas bottleneck now? Looking at recently published calculations by the Federal Network Agency, one could certainly be concerned, because in at least three out of seven scenarios there was a gas shortage in the coming winter.

A more recent joint diagnosis by several German economic research institutes, on the other hand, comes to the conclusion that even if Nord Stream 1 were to be completely stopped immediately, even in the worst case scenario, there would be no more gas bottlenecks this year and in the coming year only in rather unfavorable scenarios.

The economists calculated 1000 combinations of 26 factors, as Stefan Kooths from the Kiel Institute for the World Economy (IfW) explains. This simulates different scenarios. Examples of the factors on the supply side are the question of how much liquefied natural gas (LNG) can come to Germany via the Netherlands, or on the use side, how much gas can be replaced by other energy sources.

In the middle of the forecasts, the researchers see no more gas gaps this year or next. This is mainly due to the fact that the reservoirs have filled up. However, they do not give the all-clear. A complete halt to deliveries in July would result in a gas gap of 157,600 gigawatt hours for the coming year in the worst of the 1000 scenarios. If you take the number 200 of the most unfavorable scenarios, there are only 23,800 gigawatt hours that are missing.

In April, the economic researchers had identified significantly stronger effects of an immediate delivery stop. The difference to the updated forecast was that the gas storage facilities are gradually filling up. At the time of the calculations, they were 58 percent full. According to the AGSI platform, it is now an estimated 63.4 percent. However, this increase does not lead to a large improvement in the scenarios, as Kooths explains.