While American tourists have been filling up Europe’s corners this summer, happily snapping away and occasionally complaining about the heat, the region’s energy/climate crisis continues to deepen.
In the latest piece of bad news to hit the headlines this summer, Bloomberg reported Tuesday that officials in the U.K. had a “reasonable worst-case scenario” over potential gas shortages and a cold winter that could force organized blackouts.
That scenario included potential cuts in electricity imports from France and Norway, as countries struggle to ensure they have enough to get their own people through the winter. The U.K. government was quoted in the story that they didn’t expect the above to happen.
Still, social media served up some glimpses of past blackouts:
Potential shortages of electricity in the U.K. and worries about gas shortages across Europe has been exacerbated by Russia’s roughly six-month war in Ukraine that has fueled soaring commodity prices and left governments racing to wean themselves off Moscow’s energy supplies. Consulting firm Cornwall Insight has warned that energy bills in a typical U.K. household could triple next year, reaching £4,266 ($5,208).
“The winter outlook for power & gas supplies across in Europe has become increasingly grim, with countries such as the U.K. now acting fast to plan for the worst. We are seeing more nationalized efforts in response to tightening supplies, with Norway hinting at potential export halts in the event of short supply, driving country level efforts to secure supplies independently,” noted analysts at RBC Capital Markets.
The U.K. is also facing water shortages, due to lack of rain amid record-shattering heat.
The heat wave has battered the continent as well, with scorching temperatures causing wildfires in Spain and Portugal, while Italy’s rice paddies — notably its beloved riscotto rice — are under threat of turning dry and salty.
All that has come amid a summer of so-called revenge travel, with pent-up demand from three years of a pandemic sending travellers up to the skies in airplanes also seen as part of the emissions problem. German travel operator TUI
TUI,
on Wednesday reported third-quarter bookings at 90% of the levels seen in 2019.
Lack of water has been a huge problem for Germany, with the continent’s misery deepening on news Wednesday that the Rhine river’s falling water levels could reach a critical level by the end of the week. A marker just west of Frankfurt was set to drop to just under 16 inches, meaning barges can’t carry vital transports of coal and diesel up the ancient river.
“The low water levels are a déjà vu of the 2018 problems and are exacerbating the capacity bottlenecks in German inland navigation. While the economic impact in 2018 was rather small, it could be more substantial this time given the critical logistics of fossil fuels,” Deutsche Bank analysts Marc Schattenberg and Stefan Schneider said in a note last week.
“As coal-fired power plants are to take over to save gas, waterways could become an Achilles’ heel. Much of the needed hard-coal is transported from Dutch ports by barges,” and cargo ships are already reducing their loads, the analysts added.
Wednesday also marked the official start of Spain’s plan to save energy, which has involved a heavily criticized decision in some corners to limit air conditioning to 27 degrees Celsius (80 degrees Fahrenheit) for businesses in summers, while shop windows and public buildings must turn their lights out by 10 p.m., local time.
Heating in winter for the same establishments will be limited 19 degrees Celsius.
The government clarified that hotel guests would be able to keep things cooler in their own rooms, while gyms, public transport, restaurants and bars would be able to keep the aircon at 25 degrees Celsius. Schools and hospitals are among those establishments exempt from the new rules.
This year, the oil and sector
SXEP,
has been the best performing in European stock markets, with a gain of 17%, while retailers
SXRP,
have slumped 27%.
