Almost 60 percent of the EU’s energy needs were met by net imports in 2020. Germany’s energy import dependency was still higher at 63.7 percent – a slight decrease compared to the previous year’s 67 percent.
With an increasingly integrated European energy market, the significance of a country-focused analysis of import dependence will decline, and an EU-wide one will come into focus.
What impact will the Energiewende have on energy imports?
Energy prices in Europe increased sharply in 2021/2022 in large parts because supply could not keep up with the increase in demand – especially for natural gas – as countries recovered from the coronavirus pandemic. At the same time, Russia’s behaviour as a gas exporter and rising tensions at its border with Ukraine stoked worries about the reliability of Europe’s eastern neighbour as a key energy supplier. All of this has brought the questions of dependence on fossil fuel imports and what effects the ongoing energy transition has back at the top of the public debate.
Overall dependence on energy imports will change dramatically for some countries as the energy transition progresses. The rapid growth of renewable energy is likely to alter the power and influence of some states and regions relative to others, and to redraw the geopolitical map in the 21st century, said a 2018 report published by the International Renewable Energy Agency (IRENA).
The plan to reach climate neutrality by 2045 should all but eliminate fossil fuels from Germany’s energy mix. The German government has introduced interim greenhouse gas emission targets for the years until 2040 with the Climate Action Law.
As fossil oil and gas are being phased out, many see the need to partly replace them with synthetic fuels. Renewable electricity is converted into hydrogen, methane or synthetic petrol (power-to-x) to serve as energy sources in certain areas, for example in industry, road freight transport, shipping or seasonal energy storage. According to several studies and politicians, Germany will have to import significant amounts of these green fuels, because space for generating electricity from renewables is limited in the country and power-to-x fuels could be produced significantly cheaper in other regions of the world. Thus, while Germany will likely reduce its overall dependence on energy imports, it will continue to rely on supply not only from within the European network but also from third countries.
European Union’s import dependence
The EU produces large parts of its energy domestically, with about a third from renewables and nuclear each, and the rest mostly from solid fuels like hard coal and lignite, and some from natural gas and crude oil.
Still, most energy needs (about 60%) are met with imports. Together, energy imports of oil, gas and coal make up around 15 percent of total EU imports (% of trade in value).
More than two-thirds of the EU’s energy imports in 2020 were petroleum products, followed by gas (about a quarter) and coal (less than 5%). Russia was the main extra-EU supplier in all three categories (25.5% petroleum, 43.9% gas and 54% solid fossil fuels), followed by Norway for natural gas and the U.S. for crude oil.
Energy import patterns vary widely across the EU member states. While more than 80 percent of imports in countries such as Malta, Greece and Sweden are petroleum products, over a third is gas in Hungary, Austria and Italy. The total import dependency rate in 2019 ranged from 5 percent (Estonia) to more than 90 percent in Cyprus, Luxembourg and Malta.
In 2019, the EU member state by far the least dependent on energy imports was Estonia (4.8%), followed by Sweden and Romania (both 30%). Estonia’s high degree of energy self-sufficiency is based on domestically produced oil shale, an energy-rich sedimentary rock that can be either burned for heat and power generation or used for producing liquid fuels, according to the 2019 International Energy Agency (IEA) country report.
Germany's import dependence
Germany - OIL
Oil consumption peaked at the end of the 1970s, but it is still Germany’s most important primary energy source. Oil covered 31.8 percent of the country’s primary energy use in 2021. Oil was mostly used as a transportation fuel, and only a small fraction was used for power production.
According to the Federal Institute for Geosciences and Natural Resources (BGR), about 98 percent of Germany’s primary mineral oil consumption had to be imported in 2020. The country’s domestic crude oil output from 49 oilfields amounted to 1.9 million tonnes that year.
In 2021, Germany imported 81 million tonnes of crude oil (the country also imports additional mineral oil products). Russia was by far the largest supplier in 2021, delivering 34.1 percent. The U.S. provided 12.5 percent, Kazakhstan 9.8 percent and Norway 9.6 percent. In total, 30 countries supplied crude oil to Germany.
What impact will the Energiewende have on oil imports?
Transport accounts for most of Germany’s oil consumption, so the transition to renewables, which has largely been focused on electricity, has had little impact so far. Still, the energy transition has reduced the already minor role of oil in power generation (0.8% share in 2021 gross power production), because cheap renewable energy has crowded out oil-based generation.
The Climate Action Law stipulates that the transport sector must almost halve emissions by 2030 compared to 1990, which means oil use must decrease significantly. However, greenhouse gas emissions in transport in 2019 were still at 1990 levels – and slightly below in 2020, when the pandemic effects pushed emissions down.
The government aims to reduce final energy consumption in transport to 90 percent of 2005 levels by 2020 and to 60 percent by 2050 with the help of more efficient engines. However, consumption has actually increased (with a dip in pandemic year 2020 helping Germany reach its target). If electric cars catch on as the government hopes – the new coalition aims to have 15 million e-cars on German roads by 2030 --, renewables will be able to supply more of the energy required for transport, reducing Germany’s dependence on oil imports. However, for certain modes of transport – such as freight trucks – imports of synthetic fuels could become necessary.
Germany - GAS
Gas covered more than a quarter of Germany’s primary energy use in 2021, making it the country’s second most important energy source. Germany is among the world’s biggest natural gas importers and around 95 percent of its gas consumption is met by imports, according to the BGR. The country re-exports about half of the natural gas it imports. In 2020, the country produced 5.7 billion cubic metres (bcm) of natural gas, but according to geologists, the fields are nearing depletion. Domestic natural gas production has been falling since 2004 and will likely cease altogether in the course of the 2020s. Strict regulations make substantial use of fracking highly unlikely for now.
Germany imported 5,009 petajoules (PJ) of natural gas in 2021, according to the Federal Office for Economic Affairs and Export Control (BAFA). The share of imports by country of origin is unclear. Due to data privacy regulations, BAFA stopped publishing import volumes by country in 2016. However, the economy and climate ministry said in 2022 that 55 percent of gas imports came from Russia, 30 percent from Norway and 13 percent from the Netherlands.
Gas is imported to Germany exclusively by using pipelines. The construction of Gazprom’s contentious Russian-German Baltic Sea pipeline project Nord Stream 2 is complete, but bureaucratic hurdles and Russias war against Ukraine continue to put the project's future in doubt. The certification process was put on hold at the start of the war. [Also read the factsheet Gas pipeline Nord Stream 2 links Germany to Russia, but splits Europe]
Germany currently has no infrastructure for the direct import of liquefied natural gas (LNG). However, there have been attempts to set up a domestic LNG import infrastructure, which so far have failed due to lack of economic interest. As a result of the war against Ukraine and worries about supply security, the German government said it aims to build two domestic import terminals. The government has already said it will provide half of the funds necessary to build one of the two likely projects. Germany can currently be supplied via terminals in neighbouring countries, where the LNG is regasified and fed into the natural gas pipeline infrastructure.
What impact will the Energiewende have on gas imports?
Currently, most of the gas is used in the industrial sector (e.g. for power and heat supply, or in chemical processes), followed by private households (mostly heating), public power and heating supply, manufacturing and trade. Natural gas consumption in transport is marginal. The lion's share of gas is burned to produce heat, and only a fraction is used to produce electricity.
Germany’s government and many experts see natural gas as a bridge to a low-carbon economy because it produces much less CO₂ emissions when combusted than either coal or oil. However, fugitive emissions, like the leakage of methane during production and transportation, need to be taken into account to evaluate total lifecycle greenhouse gas emissions. Gas complements fluctuating power supply from renewables rather well, because modern gas-fired power stations (unlike coal) can switch from idle to full output within minutes if necessary.
The former German government said that the planned exit from nuclear and coal-fired power generation means that mid-term gas demand will increase. However, many analysts doubt that total natural gas demand will rise during the energy transition as efficiency increases and renewables, storage and ultimately renewables-based gases (such as green hydrogen) will cover more and more of the energy needs across Europe. Projections for future EU and German gas demand vary widely, many foreseeing a decrease.
Power-to-gas as a way of converting electrical energy into methane or hydrogen for direct use or the long-term storage of renewable power have only been tested in pilot projects and have yet to be used on a larger scale. The federal government strongly bets on green hydrogen in its quest for climate neutrality, and says much of it will have to be imported. In a 2018 analysis, think tanks Agora Energiewende and Agora Verkehrswende also said that Germany would need the well-directed use of power-based synthetic fuels, including gas, in connection with a phase-out of conventional oil and natural gas to reach its long-term climate targets. The think tanks agree that large amounts must be imported.
Germany - COAL
Germany’s largest source of domestic fossil fuel is coal, but its consumption has decreased a lot in recent years, with a rebound in 2021 – a year with unfavourable weather conditions for renewables and exceptionally high natural gas prices.
Germany still extracts lignite (or brown coal) from opencast mines for power production on a large scale – 107.4 million tonnes in 2020 - and imports very little. For years, Germany was the world’s biggest producer of lignite – which emits particularly high levels of CO₂ – and the country still has extensive deposits. Lignite covered about nine percent of Germany’s primary energy use in 2021. Most is burned for power generation (19% of Germany’s gross electricity production in 2021) or district heating.
Due to unfavourable geological conditions, German hard coal is not competitive on the international market, and subsidised hard coal mining ended in 2018. Germany now has to import all the hard coal it uses, mainly by the energy sector and for steel production. (See the CLEW factsheet on coal for more details). In 2020, Germany imported all of the hard coal it consumed with 31.8 million tonnes. Its leading coal suppliers were Russia (45.4%), the United States (18.3%) and Australia (12.3%). Hard coal covered nine percent of Germany’s primary energy use in 2021. Most is burned for power generation (9% of gross electricity in 2019).
What impact will the Energiewende have on coal imports?
The new government coalition decided to pull forward the phase-out of coal to 2030 (from 2038). The former government had proposed a shutdown timetable for lignite plants and the introduction of auctions for remuneration for switching off hard coal plants. The new government will now have to re-assess the plans.
In the past, critics of Germany’s current push to reduce the use of CO2-intensive lignite had said the country should not abandon its only sizeable domestic energy source. Mining union IG BCE, for example, warned in 2015 that the Energiewende can only succeed if Germany doesn’t play “Russian roulette” with its supply security. The union argued that “domestic energy sources ensure German companies don’t become even more dependent on price and supply fluctuations on world markets. Our lignite can guarantee this in a balanced energy mix.”