Challenges in the European energy market

VTV.vn - This winter is considered an important measure of Europe's ability to be energy self-sufficient after the 2022 crisis.

Europe is entering its fourth winter since the Russia-Ukraine conflict rocked energy markets. In Germany, from old Berlin apartments to small restaurants, heating bills have become a real burden, highlighting the challenges facing Europe as a whole. Although countries in the bloc claim to have enough gas reserves for the winter, uncertainty is growing as forecasts of a weakening polar vortex, which could bring more cold air down. In that larger picture, the stories of German people and businesses have become a typical slice of the heat and cold of this winter in Europe.

In Germany, rising energy costs have had a direct impact on households. Iris Nicole De Riz, who lives in a century-old apartment in Berlin, said keeping warm has become more expensive than it used to be.

Ms. Iris Nicole De Riz - Berlin resident said: "I used to always set the heating level to number 5. Now I never dare to set it above level 2. The consumption level is clearly displayed here so I have to constantly check to not use beyond my ability to pay. Every time I look at the bill, I am shocked, the price has increased by 40% in just a few years. This increase is really too high and puts a lot of pressure on daily life."

According to experts, the period of sharp price increases is an inevitable consequence of Germany's reduced dependence on gas from Russia.

It’s not just households that are feeling the pinch, service businesses are also facing huge pressure. For a small restaurant in central Berlin, the sharp rise in fuel costs following the Russia-Ukraine conflict has created a lasting burden.

Ege Taksim, a restaurant owner in Berlin, said: "When I opened my restaurant three years ago, a gas cylinder cost only about 35 euros. When the Russia-Ukraine conflict broke out, the price immediately jumped to 110 euros per cylinder. Heating costs have also increased sharply. In total, over the past few years, it has probably increased by about 400 euros. For a small business like ours, this increase is a really big burden."

Experts say the sharp price increases are a natural consequence of Germany’s reduced dependence on Russian gas. As it moves to alternative sources with higher prices, costs for end users will also increase. While new buildings are meeting energy efficiency standards, the pace of renovation of older buildings remains slow, prolonging the winter burden.

In addition to the practical difficulties in Germany, Europe as a whole is facing greater weather uncertainty. According to Bloomberg, meteorologists predict that the polar vortex in the Arctic will weaken, allowing cold air to flow in. This could lead to an extremely cold winter this year, in contrast to last year's unusually warm winter.

The energy market reacted immediately. On the ICE London exchange, the price of TTF natural gas for December delivery increased by 2.6% on November 14. In the US, the price of natural gas on the NYMEX exchange reached the highest level in the past three years.

Against this backdrop, the EU has announced that its gas reserves are at around 83%, enough to meet winter demand. However, compared to 92.6% at the same time last year, this year's reserves are still lower. If the winter is colder or longer, the risk of supply-demand imbalances could re-emerge. This is why many countries are pushing for renewable energy expansion, while France and Belgium are extending the life of their reactors or building more nuclear plants. From freezing Berlin apartments to the EU economy adjusting its gas import structure, this winter is seen as an important measure of Europe's ability to be energy self-sufficient after the crisis of 2022.

Source: https://vtv.vn/thach-thuc-tren-thi-truong-nang-luong-tai-chau-au-1002511241929185.htm