Cold temperatures pose the first test for Europe’s energy networks | Popgen Tech

LONDON – Temperatures in northern Europe are expected to drop sharply over the coming days as cold air blows in from the Arctic, posing the first major winter test of the region’s energy grids.

The UK’s Met Office issued a number of severe national weather warnings for snow and ice on Wednesday, with temperatures set to drop as low as -10 degrees Celsius (14 degrees Fahrenheit) by the end of the week.

Temperatures across the Nordic countries and Central and Eastern Europe will also drop to near or below freezing in the coming days.

The projected cold snap is thought to represent a significant stress test for Europe’s fragile energy market systems.

For several months, European governments have been scrambling to fill underground storage facilities with natural gas supplies to ensure enough fuel to keep homes warm during the winter.

The latest data from industry group Gas Infrastructure Europe shows that the EU’s gas storage is estimated to be around 90% full. This comes as Russia sharply cut gas supplies to Europe throughout 2022 following the Kremlin’s invasion of Ukraine at the end of February and the resulting sanctions.

Energy analysts told CNBC that while Europe’s gas storage levels were in a relatively strong position for the winter, southern Germany could be “particularly vulnerable” to freezing temperatures, partly due to nuclear power outages in France. The UK could also face problems early next year if energy exports from the EU fall.

Raad Alkadiri, managing director for energy, climate and sustainability at Eurasia Group, said Europe was “well prepared” for the drop in temperatures, helped by this year’s record build-up of natural gas supplies and the late onset of winter temperatures.

“If the period of freezing temperatures is extensive, there remains a risk that gas demand in some parts of Europe will have to be further curtailed through periodic rationing,” Alkadiri told CNBC by email.

Deep-seated problems with France’s nuclear-heavy energy strategy have raised serious questions about its readiness for the colder months.

In the event of further curbs, Alkadiri said European capitals would seek to ensure they are skewed towards industry and preserving supplies to residential households, “which remains their number one priority.”

The French government warned last week that tense energy market tensions could lead to blackouts and continuous power outages in the coming weeks.

Britain’s National Grid chief previously warned of the possibility that households could face “really, really cold” weekdays between 4pm and 7pm in January and February if gas imports are cut. This scenario, which is considered “unlikely”, follows a statement from the UK’s energy regulator Ofgem that Britain faces a “significant risk” of winter gas shortages.

Meanwhile, national grid operator Fingrid has suggested that the winter ritual of people warming up the cabins of their cars before getting in might be considered a luxury to reduce the strain on the power grid.

The Nordic country’s energy authority also warned earlier this month that the risk of short power outages had increased due to uncertainty in domestic production and foreign imports.

“Energy markets feel a bit like cooking the frog right now,” Lukas Bunsen, head of research for Central Europe at Aurora Energy Research, told CNBC by email.

“The situation is quite dire – colder weather or any more unexpected outage could lead to power shortages in France,” he added. “In addition, high prices are harmful to both industry and consumers.”

Bunsen underlined the point that the situation in Europe is not as bad as it could be, however, citing the 27-nation bloc’s “well-stocked” gas storage facilities.