Cold averted but heads stay cool
The gas shortage of 2012 — and what we learned from it.
Winter in full force
In February 2012, the people of Germany donned every bit of warm clothing they had in their wardrobes. It was so bitterly cold that just stepping outside was unpleasant. It seemed like even the wind just didn’t want to move, and its lethargy was shared by the sun, which barely showed itself. It was a challenging time for many people — and, indeed, for the gas industry.
Bavaria and Baden-Württemberg found themselves at the end of a chain of unhappy events: In early 2012, Russia was experiencing even colder weather than Germany. “Father Frost” brought temperatures down to 20 below freezing, with the result being that the country’s natural gas industry withheld large proportions of its planned deliveries to Western Europe. The energy was needed primarily in its own district heating plants, so ever less natural gas was making its way to southern Germany.
Father Frost poses problems for the European family
On 9 February, the online portal of Die Welt newspaper wrote:
“Schoolchildren freeze because not enough gas flows out of Russia.” Hence: “in many places industrial customers have already been urged to turn off their boilers or to switch to another fuel, while in some municipalities people were even told to turn down their heating. The town of Ettlingen near Karlsruhe, for example, has already had to turn down the heating in local schools, at the indoor pool and in its own office buildings. Certain industrial customers have actually found their gas cut off.
According to an OGE spokesperson, the border crossing point at Waidhaus in Bavaria has seen 25 to 30 percent less natural gas. Apparently, four power plants in southern Germany have already been withdrawn from the network.”
A few days previously, Der Spiegel magazine had already stressed that the tense situation in the heating market was a European problem:
“It is not only Germany that is affected. Austria, Poland and Italy are also complaining of falls in gas deliveries. The Austrian gas supplier OMV reported cuts in deliveries of around 30 percent ‘due to the harsh winter in Russia’, although strong domestic production and utilisation of strategic emergency stocks mean Austria’s supply is apparently secure. Poland, we are told, has already been forced to make use of its own reserves as a result of the supply shortage. Meanwhile, the Italian gas supplier Snam is having to use other suppliers and gas storage facilities to keep its customers happy.”
The “Gasmangellage” – a new word doing the rounds
The word “Gasmangellage” means “gas shortage situation” and thus describes a scenario like this, where the problem is not interruptions, but rather significantly reduced gas transmission.
During this time, industry representatives from the European energy market gathered at E-world in Essen. In the middle of the NetConnect Germany exhibition stand, a rather memorable meeting took place: The decision-makers from the transmission system operators sat down over a few cups of coffee and set to work at full steam.
At the top of the agenda, of course, was the situation in the south. They discussed how and by what means natural gas could be transported to the affected regions, since the north-south direction is notable for its insufficient capacity. Norway, for example, had adequate natural gas stocks, but the pipelines to southern Germany had reached their capacity limits. One of the solutions proposed involved deliveries from various countries to Baden-Württemberg through swap deals and exchanges. With these and other measures decided upon via the short official European channels, the gas shortage was eventually resolved.
Effective communication between the European partners in the natural gas market
This is far from a given in times of so-called “unbundling”. As part of the separation of networks from sales activities as demanded by politicians, customer data from the network segment may not be forwarded to sales. The network operator even has to prevent the flow of information between the network and sales, causing much talk in the industry about “Chinese walls”. The unbureaucratic exchange that took place at E-World 2012 overcame these virtual walls — to the benefit of hundreds of thousands of customers.
Even the winter of 2012 ended eventually and politicians, energy suppliers and network operators could finally breathe a sigh of relief. The Federal Ministry of Economic Affairs noted:
“The high value of an adequate supply was made clear by the regional difficulties experienced due to the supply situation in Germany in February 2012. In the gas segment, early recognition of any deficits is crucial ... Hence the avoidance of supply gaps is a high priority for gas too.”
LÜKEX trials the worst-case scenario
Officials from all the federal states regularly meet for crisis management exercises, known by their German abbreviation of LÜKEX, implemented across the different states. In November 2018, their sights turned to the natural gas supply, with participants playing out the scenario of the “Gasmangellage” in southern Germany – but under more severe conditions. In the scenario assumed for the LÜKEX, extreme weather conditions reduce inventory levels at gas storage facilities, so the supply situation gradually worsens. As a result, first the economy and later to a certain extent the population are affected by gas supply shortages.
Players in the natural gas market gather to talk
The exercise is particularly important because it brings together the federal institutions and the market participants involved in the natural gas supply, and all those involved learn to cooperate more effectively. Also included are representatives of public and private consumer protection groups, domestic security and security of supply.
What preventative measures are officials taking to prevent a crisis in the gas market? And how would they act if there were one?
The Federal Office of Civil Protection and Disaster Assistance (BKK) wrote in a press release:
“By means of systematic crisis preparation, we aim to ensure the best possible protection for the population in the case of an actual crisis. At the BBK the LÜKEX exercises are planned, prepared, executed and evaluated by a project group that collaborates with the federal states. True to the motto ‘In der Krise Köpfe kennen’ (‘knowing who to talk to in a crisis’), it is thus able to develop a culture of coordination and improve crisis management among the participants beyond the exercise itself.”
Crisis team and crisis levels: the “Gas Emergency Plan”
“The Gas Emergency Plan for Germany, produced by the Federal Ministry of Economic Affairs and Energy, outlines measures for resolving disruptions to the natural gas supply. As soon as such a situation comes to light, the ‘National Crisis Team’ is called into action, with its meetings also attended by representatives of the federal states, the federal government and the gas industry (as well as, where relevant, gas transmission grid operators, distribution network operators and industry associations). One of the tasks for the Federal Network Agency in the exercise will be to act within this crisis team.
Likewise, the Gas Emergency Plan provides for three crisis levels that are established after an assessment of the situation and trigger various measures: early warning level, alarm level and emergency level. During the course of the exercise, the establishment of the emergency level is through a resolution by the federal government, which activates the Federal Network Agency as the nationwide load distributor.”
The elements of the emergency level in the case of gas shortages:
- Technical problem: failure of essential services and/or compressor stations with no possibility for rapid establishment of an alternative supply (major accident)
- Further massive long-term supply outages can be expected without adequate possibility of an alternative supply
- Measures pursuant to section 16 (2) of the German Energy Industry Act (EnWG) are no longer sufficient for system stability
- Balancing gas is consistently no longer sufficiently available in the market and can no longer be procured at short notice, or trading of balancing gas is suspended
- Worsening of the supply situation so that supplies to household customers and vital requirements are at risk
Germany’s natural gas supply is very secure and well organised
The scenario outlined above for the LÜKEX is actually highly unlikely to come about. If it were to arise, then the authorities, network operators and energy suppliers would be very well prepared thanks to these sorts of exercises.
Furthermore, experiences from the gas shortage of 2012 have shown that in the worst-case scenario, maintaining good contact with European partners in the energy market pays off. The collaboration worked smoothly and the findings obtained led to further optimisations of the overall transmission and supply system. When specialists of various disciplines work well together and pursue a common objective, problems can be solved if you keep a cool head.