The energy crisis

Germany’s government is the “stupidest” in Europe for managing to embroil itself in a full-blown “economic war” with its top energy supplier, Russia, left-wing politician Sahra Wagenknecht said on Thursday.

Speaking in the Bundestag, the former co-chair of the party Die Linke (The Left) urged an end to anti-Russian sanctions and the resignation of the country’s vice chancellor and economy minister, Robert Habeck.

While describing the ongoing conflict in Ukraine as a “crime,” Wagenknecht said the anti-Russian sanctions are “fatal” for Germany itself. With energy prices out of control, the country’s economy will soon “just be a reminder of the good old days,” the MP warned, as she urged canceling the restrictions and engaging in talks with Russia.

“We really have the stupidest government in Europe,” she told the parliament, calling for Habeck to resign.

The biggest problem is your grandiose idea of launching an unprecedented economic war against our most important energy supplier.

“The idea that we are punishing Putin by impoverishing millions of families in Germany and destroying our industry while Gazprom is making record profits – how stupid is that?” Wagenknecht wondered.

The controversial speech met quite a mixed reaction, with Wagenknecht’s remarks scoring applause in the Bundestag from MPs of polar opposite political views, including members of the right-wing Alternative for Germany (AFD). However, multiple left-wing politicians rushed to distance themselves from Wagenknecht’s statements and condemn her.

“The party’s position on sanctions against Russia was decided at the last federal party conference. There is no ‘economic war against Russia.’ Russia is at war with Ukraine,” the former co-chair of Die Linke, Bernd Riexinger, tweeted, adding that there must be “no doubt” about whom the party backs in the ongoing conflict.

Former left-wing MP Niema Movassat went even further, taking to Twitter to call for Wagenknecht to be excluded from his parliamentary group. The politician’s remarks contradict “a lot of” what the party agrees on, and she should be punished for “acting against” Die Linke, Movassat suggested.

www.rt.com/news/562525-germany-russia-economic-war

Germany’s newly approved directive to turn off outdoor advertising at night to save energy might end up costing more than leaving the illumination on, Die Welt newspaper reported on Saturday, citing the German Association for Out of Home Advertising (FAW).

Under the new rules, set out by Economics Minister Robert Habeck, illuminated billboards and neon signs across Germany have to be switched off at night and for most of the day (between 10 pm and 4 pm) starting from September 1.

However, FAW managing director Kai-Marcus Thäsler told Die Welt that the measure will be difficult to implement.

“By far the largest part of the systems affected are advertising signs that have so far been equipped with an automatic twilight function. This twilight control must now be replaced by an electrician with a timer on each individual sign,” he said.

Thäsler explained that his organisation lacks the funds, materials and skilled workers to quickly carry out the work, and that the lighting in outdoor advertising systems is a heat source which prevents the display panels from fogging up and freezing over.

“In order to prevent permanent damage, heating systems would have to be installed instead of the lighting, but their energy requirements would be many times greater,” he stated.

Furthermore, the sheer number of illuminated billboards – around 92,500 – will make the process of converting them to the new standards time-consuming, and may not be complete before the ban expires in February 2023.

www.rt.com/business/562533-germanys-energy-saving-plan-harm

The crisis affecting the electric power industry across EU started in 2021 and was caused by European policymakers themselves, according to former Austrian foreign minister Karin Kneissl.

“We had a crisis in the electric power industry even before the gas crisis began,” she said on Saturday in an interview with Russian news agency TASS.

“That’s the result of the liberalization of the past 15-18 years, and we have been going through this since April 2021, for more than a year so far,” Kneissl added.

According to the former foreign minister, the electricity market in Europe is not a classic supply-and-demand market anymore, and is now operating “in accordance with some incomprehensible principles.”

She added that the market had been redirected with a preference for renewable energy, and had turned into a unbalanced one as a result.

“The electricity market, despite the role of renewable energy sources, is still highly dependent on gas prices, even when more electricity is generated from renewable sources,” Kneissl said.

Greeks saving on food to pay for energy – surveyREAD MORE: Greeks saving on food to pay for energy – survey
The former minister stressed that prices for electricity in the region saw a surge of up to 40% after April 2021, and have now soared nearly 400%, inevitably dragging households’ finances down.

“For manufacturers, for the industrial sector, the situation is even worse. There’s already a movement in the UK – it’s not [part of] the EU, but it might spread further – where people are simply boycotting their electricity bills,” she said, noting that the electricity crisis had begun prior to the gas crunch.

Kneissl attributed the crisis to the significant reduction in investment in oil and gas projects, explaining that supply was declining while demand remained.

“The demand has been growing after the pandemic. It was quite calm during the pandemic for a year and a half,” she said.

“And we can still be glad that in China demand remains at a fairly low level, since they are introducing quite a lot of lockdowns,” Kneissl added.

www.rt.com/business/562577-europe-electricity-crisis-kneissl

The US has sent Poland a proposal to help build six nuclear reactors in the country in a bid to reduce carbon emissions and gradually phase out coal, the Polish Climate ministry announced on Monday.

Delivered to Poland’s Minister of Climate and Environment Anna Moskwa by US ambassador Mark Brzezinski, the proposal suggested that Washington and Warsaw create a detailed bilateral roadmap for the construction project, which is set to be finished by 2040.

“It's more than a commercial offer, it reflects 18 months of work and millions of dollars spent on analysis and evaluations,” said a spokesperson for the Westinghouse Electric Company, a US firm bidding to take on the project.

US Secretary of Energy Jennifer M. Granholm called the report “a major step towards Poland’s development of a robust civil nuclear industry that is zero-carbon emitting and will result in another European source of energy that is free from Russian influence.”

“This project has the potential to ensure that the Polish people can receive the safest, most advanced, and reliable nuclear technology available,” the politician added.

The Polish government expects the partner in its nuclear programme to take a 49% stake in the company and assist in managing and financing the plants, after providing the technology for them.

The government in Warsaw will now consider the US proposal, and make a decision before annual talks on technology issues this autumn.

Washington’s offer comes shortly after Poland claimed that it had become the “locomotive of development” for the whole of Europe, while questioning Germany's supposedly misguided energy policies, which have been left in “ruins”.

“Germany’s policies have inflicted tremendous damage on Europe,” said Polish Prime Minister Mateusz Morawiecki, describing the phase-out of coal and nuclear power as “premature”. The leader also criticized Berlin’s decision to allow the construction of the Nord Stream 1 and 2 gas pipelines, and grilled Berlin for becoming energy dependent on Russia.

www.rt.com/news/562728-poland-us-nuclear-power-plants

Germany is planning to allocate €67 billion ($67 billion) to provide financial aid to domestic energy companies hit by supply shortages resulting from the sharp decrease in natural gas imports from Russia, the business daily Handelsblatt reported on Tuesday, citing sources close to the federal government.

The massive financial package is expected to help KfW, the German state-owned investment and development bank, to provide guarantees and liquidity assistance to local energy firms. The funds will reportedly be transferred from the WSF (Economic Stabilization Fund), which was created during the Covid-19 pandemic.

“In view of the price increases, forward-looking action by the federal government and KfW is required,” government sources told the media.

Gas prices throughout the EU have surged in recent months as a result of sanctions imposed on Moscow over the conflict in Ukraine, and the reduction of Russian supplies. EU leaders had previously announced plans to reduce gas consumption by 15% from August 1 until the end of March 2023. Member states have discretion over the specific measures adopted to achieve the goal.

“The Federal Ministry of Economics has received various applications for liquidity bridging from companies in the gas and energy supply sector, they are currently being examined,” an internal government paper seen by Handelsblatt reads. “The volume of applications is in the low double-digit billions.”

Earlier this month, Germany’s largest gas importer, Uniper, asked for extra government aid due to financial losses from its attempts to replace Russian natural gas by buying gas on the spot market.

www.rt.com/business/562704-germany-energy-companies-bailout

The EU will review the sanctions on Russia and could lift some of them as soon as this autumn, Hungarian State Secretary for Foreign Affairs and Trade Tamas Menczer predicts.

The restrictions imposed on Russian trade to punish it for attacking Ukraine have failed to change Moscow’s behavior and actually rewarded it with increased revenues, after they triggered a spike in energy prices, the MP said during an appearance on M1 TV on Tuesday. Meanwhile, the European countries that imposed the sanctions are facing energy shortages.

“Reality knocks on the door of every country,” Menczer said, explaining why he believes the sanctions will be lifted sooner rather than later. Member states are set to review their sanctions policies later in the autumn.

The Hungarian MP confirmed that his country, which criticized the EU’s drive to decouple the economy of the bloc from Russian energy, opposed the idea of introducing a price cap on gas bought from foreign nations. He called the proposal absurd and impractical, citing Moscow’s promises to cut supplies to customers that try to dictate the price.

The European Commission has reportedly backpedaled on the gas price cap and is currently working on a mechanism to tax the windfall profits of energy companies. Brussels is also urging EU nations to impose various energy-saving measures to better prepare for peak consumption during the winter.

Last week, Hungarian Parliament Speaker Laszlo Kover claimed that the EU is the “loser” in the Ukraine conflict due to the economic damage caused by the sanctions.

www.rt.com/news/562747-hungary-russia-sanctions-reality