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ENERGY

Germany’s Russian gas crisis sparks run on coal

"A rush like this in the summertime, it's unheard of -- everybody wants coal," says Frithjof Engelke, a supplier of the briquettes which have become a hot commodity in the German capital.

Coal briquettes in Berlin
Brown coal briquettes are pictured in the storage of the "Hans Engelke Energie" heating products business in Berlin. Photo: Carsten Koall / AFP

A looming shortage of Russian gas in the wake of the Ukraine war has reignited enthusiasm for this method of heating private homes despite its sooty residue and heavy carbon footprint.

Engelke, 46, head of the century-old Berlin business Hans Engelke Energie, says it’s brought a bonanza for his family business: “My holidays will have to wait.”

He and his team are frenziedly taking orders, organising deliveries by truck — now booked out until October, and getting supplies ready for those who come directly to pick up coal from his warehouse. 

On a hot summer’s day, he weighs and bags loose coal amid the dust and din of his filling machine, then arranges the bags on pallets, awaiting customers.

READ ALSO: EXPLAINED: What are Germany’s alternatives to Russian gas?

In Berlin, 5-6,000 homes still heat with coal — only a fraction of the city’s 1.9 million homes, say municipal authorities.

Engelke’s customers are often elderly people, sometimes entirely dependent on coal and living in old dwellings that have never been renovated.

Others are lovers of the “cosy” heat emanating from often ornate old ceramic stoves.

But this year, new customers have arrived “en masse”, says Engelke, whose medium-sized company has also diversified into wood pellets and fuel oil.

“Those who heat with gas but who still have a stove at home now all want to have coal,” he said, citing a phenomenon seen throughout Germany as winter approaches.

‘Better than being cold’

Jean Blum is one of the new converts.

The 55-year-old man with tousled hair and a bushy white beard loads 25-kilogram (55-pound) bags filled with precious black briquettes in his trailer.

“I’m buying coal for the first time in years,” he tells AFP.

Since his home is equipped with gas heating, he sometimes lights his stove, but only with wood.

READ ALSO: Will Germany’s gas supplies last the winter?

Hans Engelke Energie Berlin

A worker loads briquettes of coal in the storage of of the storage of the “Hans Engelke Energie” heating products business in Berlin. Photo: Carsten Koall / AFP

With the jump in gas prices, which will be exacerbated this autumn when operators will be able to pass on the increase in energy levies to the consumer, Blum wants to make sure he has a safety net.

“Even if it’s bad for your health, it’s still better than being cold,” he says.

Although coal prices have soared 30 percent this season, it remains cheaper than wood, whose price has more than doubled.

“I worry when I wonder if there will be enough gas for everyone,” he adds, noting that Russian President Vladimir Putin has already partially closed the gas tap on Germany after Western nations imposed new sanctions on Moscow.

‘Renaissance’

The black fuel is experiencing a comeback on several fronts in Europe’s top economy.

The German government had already resolved to increase the use of coal-fuelled power plants to satisfy the enormous appetites of several industries.

However Berlin insists it will keep its pledge to phase out the heavily polluting energy source by 2030 and rules out a “renaissance of fossil fuels, in particular coal,” as Chancellor Olaf Scholz recently vowed.

However with new private customers coming out of the woodwork, production has a hard time keeping up, and many small coal merchants in the capital are running out of supplies.

“We produce at full capacity during the summer, with three shifts, seven days a week,” Thoralf Schirmer, spokesman for LEAG, a mining site in the Lusatia basin, told AFP.

Hans Engelke Energie Berlin

A worker fills bags of coal with a machine in the storage of the storage of the “Hans Engelke Energie” heating products business in Berlin. Photo: Carsten Koall / AFP

The company supplies DIY stores and fuel sellers with coal briquettes.

Production has jumped 40 percent since January, he said, but demand is strong everywhere and the situation is expected to remain tense at least until this winter.

READ ALSO: EXPLAINED: How much will Germany’s gas levy cost you?

Adding to the pressure is the fact that the other factory supplying the market in Germany, based in the Rhine valley, will cease production at the end of the year, reducing supply.

“I dread the winter a bit,” Engelke, the coal seller, admits.

Currently, people are relatively relaxed when they learn that they will have to wait at least two months before getting deliveries, he says.

“Things will be radically different when it starts to get cold outside.”

By Isabelle Le Page

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POLITICS

EU ministers urge unity after Germany’s energy ‘bazooka’

EU finance ministers on Monday pleaded for unity after Germany announced a €200 billion plan to help German households and businesses pay for high energy prices, amid accusations that the EU's biggest economy was acting alone.

EU ministers urge unity after Germany's energy 'bazooka'

Europe is struggling with historically high energy prices as it faces an early autumn cold snap and a coming winter almost certainly to be endured without crucial Russian gas supplies because of the war in Ukraine.

Many EU countries have announced national programmes to shield consumers from the high prices. But Germany went the furthest on Friday when it announced its mammoth plan, which will see help pouring to Germans for two years.

Arriving to talk with his eurozone counterparts, German Finance Minister Christian Lindner insisted the spending was “proportionate” to the size of Germany’s economy and said his goal was to use as little of the money as possible.

READ ALSO: Germany to spend €200 billion to cap soaring energy costs

But Germany’s largesse rankled several EU capitals, some of which feared their industries could take severe blows while Germany’s sits protected, deforming the EU’s single market.

Outgoing Italian prime minister Mario Draghi has slammed Berlin for its lack of solidarity and coordination with EU partners.

French Finance Minister Bruno Le Maire, without directly criticizing Berlin, called on partners to agree a common strategy against the price shock and for countries to refrain from going it alone.

“The more this strategy is coordinated, united, the better it is for all of us,” he said.

Risk to ‘European unity’

Others pointed to the unprecedented solidarity shown in the Covid-19 crisis in which the 27 EU nations, against all expectations, approved a jointly financed €750 billion recovery plan.

“Solidarity is not only on the German shoulders, I think this is something that we have to deliver at European level,” said EU economics affairs commissioner Paolo Gentiloni.

“We have very good examples from the previous crisis on how solidarity can react to a crisis and also reassure financial markets. I think that this is our goal,” he said.

While a Covid-style recovery plan is not in the cards for now, Le Maire said €200 billion in loans and €20 billion in aid should be devoted to REPowerEU, a programme to help countries break their dependence on Russian gas.

READ ALSO: Will Germany set a gas price cap – and how would it work?

Bruegel, a highly influential think tank in Brussels, called the German plan a spending “bazooka” that many EU countries were unable to match, creating a potential source of animosity.

“If the German gas price brake gives German business a much better chance to survive the crisis than, say, Italian business, economic divergences in the EU could be deepened, and European unity on Russia undermined,” it said in a blog.

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