Germany Becoming Increasingly Dependent on Russian Energy

German Chancellor Angela Merkel’s shift away from nuclear power is set to make Germany more reliant on Russian gas.

Merkel’s pledge to speed the exit from atomic power after the crisis in Japan is helping push natural-gas prices higher as Germany scrambles to identify energy alternatives. Gas supplied by OAO Gazprom may be the easiest way for her to meet Germany’s climate goals and keep Europe’s largest economy running.

As workers battle a meltdown at the Fukushima Dai-Ichi plant, Merkel is leading a global push to revisit nuclear energy, which provides about a quarter of the power generated in Germany. Increasing imports of gas from Russia, which holds the world’s biggest reserves, would deepen ties to the east yet risk raising tension with the U.S.

Merkel was scheduled to meet with Germany’s 16 state prime ministers on April 15 to discuss the future energy mix after last month calling a 90-day moratorium on a planned extension of the lifespan of Germany’s 17 atomic plants and ordering the seven oldest reactors idled pending industry wide safety checks.

Pressured by a regional election loss amid a surge in support for the Greens, Merkel, a trained physicist and former advocate of atomic power, said on March 28 that her “view on nuclear energy has changed.”

The result is “a nuclear witch-hunt” that may result in more than seven reactor closures.

German power for next year has risen about 10 percent since Merkel’s announcement, reaching its highest price in more than 19 months on April 4.

Europe’s most populous nation, Germany imports 85 percent of its natural gas and is already more reliant on Russia to meet its needs than the European Union as a whole. Germany imports about a third of its gas from Russia, compared with about a quarter for the EU.

Germany wants Russia to be “a major supplier of natural resources,” Merkel said on Nov. 26 during a visit by Prime Minister Vladimir Putin. “Europe and Russia are strategic partners whose potential for cooperation is far from exhausted.”

Merkel, who speaks fluent Russian, is already elevating Russia as a commercial and diplomatic partner, promoting exports there by German companies such as train maker Siemens AG. 

“The German attitude seems to be full steam ahead” with Russia, Charles Kupchan, a senior fellow at the Council on Foreign Relations, said by phone from Washington. Merkel is “very pragmatic, very realist, and that’s where western Europe is headed right now in terms of relations with Russia.”

For their part, the Russians are keen to oblige. Gazprom said that “German partners can increase gas purchases” under the terms of current contracts.

“I am glad that pragmatic voices in the European Union point to the high significance of gas as an energy source,” Energy Minister Sergei Shmatko told reporters in Moscow two days ago. “The latest events which we have been witnessing lately show that stable and safe supplies of gas from Russia on the long-term basis is key to Europe’s energy security.”