Germany needs fossil gas for more than a decade alongside renewables expansion – McKinsey
Clean Energy Wire
Fossil gas will be a crucial part of Germany’s power and energy supply for at least another ten years, because the expansion of renewables and the electricity grid are lagging behind, said consultancy McKinsey in a press release. A report on the future of the country’s power supply showed that Germany will need “a massively accelerated renewables expansion” as well as more gas power units which could later be converted to use biogas or green hydrogen. Companies should seek long-term gas supply contracts to ensure lower prices. Despite the “negative effects on sustainability”, 10 gigawatt (GW) of coal power capacity slated for shutdown must be kept online until emission-free, hydrogen-ready gas units are available, writes McKinsey. The consultancy’s report examined various scenarios which would bring electricity prices to a level comparable with other industrialised countries by 2025, while ensuring a secure power supply.
The new German government was determined to dedicate considerable efforts to climate and energy reforms even before Russia started its war in Ukraine and energy concerns took centre stage. The war has prompted the government to put extra focus on supply security, also through fossil fuels. Natural gas continues to play an important role in the government’s plans to move the country to climate neutrality by 2045.