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Independence through diversification

The sun sets behind power poles in Nauen

The sun sets behind power poles in Nauen, © Florian Gaertner/photothek.net

01.10.2018 - Article

Four facts on Germany’s energy supply

In order to ensure secure and affordable energy, Germany is focusing on sustainable sources of energy, pioneering technologies, open markets and a large number of suppliers. Here are four facts on the independence of Germany’s energy supply:

1. Sustainability fosters independence

Since the energy transition began, Germany has constantly increased the share of renewables in its energy mix. In 2012, not even a quarter (23.5 percent) of the electricity consumed in Germany came from renewable sources. In the meantime, this share has already risen to almost 40 percent. The German Government aims to increase the share of sustainable sources in the energy mix to 45 percent by 2025 and to 80 percent by 2050. Pioneering technologies such as power-to-gas, wind-hydrogen systems, natural gas reforming and biological methanation are making this shift possible. This leads to independence and is good for consumers and the environment.

2. European networks prevent monopolies and supply shortages

An electric car is being charged.
An electric car is being charged.© Janine Schmitz/photothek.net

Until the goal of having an energy supply primarily based on renewables has been achieved, Germany will continue to need fossil fuels to bridge the gap. These fuels increasingly need to be imported from abroad. However, Germany not only imports energy, but also exports it itself to a number of European countries and is therefore one of the hubs for transnational energy trade in Europe. An open, transparent and diverse European energy market guarantees that no country or company dominates energy trade and supply.

3. Market share is determined by supply and demand

Open competition between a large number of suppliers guarantees security of supply and ensures fair pricing. The German Government thus supports the opening of the EU market to additional suppliers via new supply channels such as import terminals for liquefied natural gas (LNG) and additional supply lines such as the Eastern Mediterranean Natural Gas Pipeline, the Trans-Caspian Gas Pipeline and the Southern Gas Corridor. The idea is that supply and demand determine the competitiveness of different sources of energy and supply routes on the German market. For example, LNG from the United States has a higher cost price because of the large percentage of gas obtained through non-conventional sources of production (fracking). It is currently not competitive in Germany.

4. A wide range of suppliers creates choice and prevents dependencies

Germany’s imports of fossil fuels such as natural gas come from a large number of countries. Just over a third of the natural gas imported by Germany comes from the Netherlands and a similar volume from Russia, while around a quarter is supplied by Norway. The rest is sourced from various other countries. Should a supplier no longer be available for technical or political reasons, other suppliers can provide more energy at short notice, thus safeguarding overall supply.

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