TRUMP SANCTIONS WARNING
Germany to stick with Russian gas
Gas is to start flowing to Europe through the pipeline at the end of 2019
London -The Nord Stream 2 gas pipeline is important to secure German energy supplies and Russia is a safe and reliable provider, Thomas Bareiss, Germany’s state secretary for energy, says.
US President Donald Trump has said the project increases reliance on Russian gas and has warned Western firms invested in it that they risk sanctions.
Gas is to start flowing to Europe through the pipeline at the end of 2019 and will allow Russia’s Gazprom to stop piping gas via Ukraine, where for years it has clashed with authorities over pricing and other issues.
Gazprom and its partners say the project is aimed at ensuring energy security in Europe, where gas production is falling.
"I know the US has concerns ... but it is not so easy. For Germany Russia has always been a safe and reliable supplier for gas," Bareiss told the Bloomberg NEF Future of Energy summit.
"Nord Stream 2 should go on because the pipeline secures energy supply in Europe," he told the conference in London.
Nord Stream 2 will double the existing Nord Stream 1 capacity from 55-billion cubic metres of gas a year. It is owned by Russian state-controlled Gazprom, which is taking on half of the planned costs of €9.5bn. The rest is divided among five European energy companies — Germany’s Uniper and Wintershall, Anglo-Dutch group Royal Dutch Shell, France’s Engie and OMV in Austria.
Germany is embarking on an expensive energy transition to replace coal and nuclear capacity with low-carbon energy.
The government wants to be free of nuclear power by 2022 and has appointed a commission to decide this year on the timetable for a withdrawal from coal as part of a wider 2030 climate goal. Bareiss said Germany would invest €50bn in improving and expanding its electricity grids, but it is far behind.
"This is causing large costs — more than €1bn a year in cost to businesses and consumers. Therefore, we have to speed up grid expansion and upgrades.
"It is a very expensive transition but it will work in the long run," he added. The coal commission aims to bring its proposals to a UN climate conference in Poland in December.