Home News Germany is nationalizing energy companies as a last resort for security

Germany is nationalizing energy companies as a last resort for security


Germany, which is heavily dependent on energy in Russia, unveiled an emergency plan to manage gas supplies last month amid deteriorating relations with the Kremlin following the invasion of Ukraine and Western sanctions. It was the first step in a three-phase plan that could lead to energy rationalization, giving priority to households and critical infrastructure, such as hospitals.

“Prices are high, uncertainties are high and risks are inevitable. Therefore, we need to be prepared for the worsening of the situation,” Economy Minister Robert Habeck told Reuters.

The legislative change will allow the government, which wants to reduce dependence on imports from Russia, to place energy companies under special administration if energy security is threatened. The strategy has already been applied to Gazprom Germany. Recently, the Minister of Economy announced that Gazprom Germany, the business in the field of energy trading, storage and transportation abandoned by Gazprom, will be transferred to the German Energy Regulatory Authority (Bundesnetzagentur).

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Habeck assured that security of supply is now guaranteed, in a time of crisis in German-Russian energy ties following the invasion of Ukraine. The Bundesnetzagentur will take control until September 30, 2022, will be able to replace the directors and make new hires.

The invasion of Ukraine has highlighted Germany’s significant dependence on natural gas imported from Russia, as well as essential infrastructure (such as refineries, oil pipelines, gas pipelines) owned by Russian companies.

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