Germany’s Power Grid Faces Collapse As Millions Stock Up On Inefficient Electric Heaters For The Winter

Germany’s Power Grid Faces Collapse As Millions Stock Up On Inefficient Electric Heaters For The Winter

Maybe they ran out of firewood to buy.

A few weeks after we reported that google searches for “firewood” exploded in Germany, ground zero of what is sure to be a very cold winter…

… the country whose electric grid will be crippled for the foreseeable future after Russia’s decision to halt nat gas supplies via the Nord Stream 1 pipeline, is now facing another crisis. According to Reuters, Germans could overload their power grid as they switch to inefficient electric heaters in an attempt to avoid gas shortages this winter, utilities warned in an article published on Sunday.

Fearing the worst, German households have been stocking up on electric fan heaters, including portable devices, sales figures show, amid fears that Russia could cut or further limit gas supplies in the wake of its war in Ukraine.

The managing director of the German association of energy and water utilities, BDEW, told daily Handelsblatt that customers could be left with even heftier power bills if they do not use the devices sparingly.

“And they can overburden the power grids, for instance when many households switch on their fan heaters in one part of town at the same time on a cold winter’s night,” BDEW director Kerstin Andreae was quoted as saying. She said she understood people’s fears of cold homes, but some of the coping mechanisms could backfire.

Germany, along with other European Union countries, is scrambling to support homes and industries burdened by a further surge in energy prices after Russia halted supplies through the Nord Stream 1 natural gas pipeline. Alas, no matter what Europe does, it can’t print nat gas, or commodities, which is why Charif Souki, chairman of Tellurian told Bloomberg TV that European buyers will ultimately be paying the equivalent of $120 to $150 per barrel for energy regardless of source for a long time.

Europe will be short on natural gas supplies this winter and over the next several winters, Souki said adding that “In the short term, it’s going to be obscene but I think that if everybody does the right thing, then over time, I think you’re going to find all of the energy prices are going to equalize.”

Pointing out the obvious, Souki said that high prices could result in demand destruction: “We’re short on energy sources in general,” he said. “So at some point, you’re going to find that oil, coal, gas and renewables are going to settle around a certain level and my suspicion is that it’s going to $120 to $150 per barrel equivalent for all of these commodities”

What was left unsaid for obvious reasons, is that “demand destruction” means thousands of people freezing to death.

To be sure, the German government has pledged that industrial users would be the first to be rationed in case of a shortfall and that private households would be spared any cuts, but it remains to be seen just how those with political clout and money will fail to get preferential treatment to millions of German pensioners.

The president of Germany’s federal network agency also said local power blackouts could result from peaks in fan heater use, according to a Saturday interview with newspaper Tagesspiegel. 

Klaus Mueller added that even amid “very high” gas prices, electric heaters would still cost users more than gas-based central heating, which is the most common form of residential heating in the country.

Germans bought 600,000 electric heating devices during the first half of the year, up almost 35% from a year earlier, according to data by market researcher GfK. The final number will likely be in the millions following the turmoil in Germany’s energy market in recent months.

Tyler Durden
Tue, 09/13/2022 – 05:45

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