Germany’s booming oil and gas industry threatens to kill Europe’s economy
source Fortune article The German economy is a shadow of its former self as oil and natural gas producers have found it hard to compete with their European counterparts.
This week the country’s economy grew only 0.4 percent in the first quarter of 2018.
And while the unemployment rate has dropped by more than a third in the past year, its growth has been a slow crawl, with the number of people working full-time just over a quarter of what it was in January 2017.
Europe’s biggest energy producer is also facing the same challenge.
Germany has seen its GDP shrink by 2.7 percent since January 2017, with oil and energy producing the bulk of its losses.
“It has been difficult for Germany to be competitive,” said Peter Zugermann, the director of energy and finance at the German Federal Statistical Office.
“In this market, you can have more money to spend on other things.”
The country’s energy crisis has also created a financial drag on the economy, pushing up the value of the countrys currency.
German exports are down by about 5 percent so far this year, and analysts expect that to rise further.
That has pushed up the cost of goods and services.
“The price of gas is going to go up, as well,” Zugmann said.
“But it’s still cheaper than in the U.S.”
German politicians have tried to tamp down expectations, but economists say it is a difficult balancing act.
“If you say, ‘Germany is going through a tough time and we’re not going to get out of it, we’re going to have to have an energy revolution,’ that is not a credible policy,” said Dieter Kniep of the German Institute for International and Security Affairs.
“A change in energy policy is not something that could be accomplished in the short term.”
The impact on Europe’s oil and coal industries The boom in the energy sector has been especially damaging for Europe’s coal industry.
European countries have been building up their coal reserves in an effort to protect the economy from a slowdown in China, the world’s largest coal producer.
The U.K. has pledged to build up 1.2 million tons of coal reserves by 2025, while Germany plans to increase its coal reserves to 2.5 million tons.
And France and Italy have announced plans to double their coal exports to 20 million tons by 2030.
But while Germany’s coal is expected to remain dominant in Europe, the region’s energy mix is changing, too.
Europe is expected, for instance, to add roughly 3.5 gigawatts of solar capacity by 2020, while the U,S., and Canada are expected to add an additional 3 gigawatts.
Meanwhile, the U:U.S. coal industry is expected grow by roughly 2.2 gigawatts by 2030, according to a recent study by the Rhodium Group.
That means the U.:U.K.-based company estimates that its U. S. coal plants will add around 1.3 gigawatts to the region by 2020.
That’s a small fraction of the coal that is now produced in Germany.
But as the energy mix shifts, so too do its costs.
“You are seeing this shift in energy mix,” said Knieb.
“And the changes in energy are starting to show up in prices.”
The price of energy The German government has pledged that its energy policies will reduce energy costs, but its own calculations suggest that won’t be enough to offset the loss in revenue from the coal industry, especially as energy production continues to rise.
The German energy minister, Thomas Oppermann said last week that he would not propose any further taxes on energy imports, saying that the country was already on a “path to transition.”
So while Germany could increase taxes on imports, that would only make up a small portion of the cost.
“I am not going down the path of increasing taxes on coal imports,” Oppermannt said.
The plan to cut taxes is also unpopular.
In June, a poll of Germans found that most Germans oppose any kind of increase in energy taxes.
The poll, commissioned by the Green Party, found that 52 percent of Germans oppose the introduction of a carbon tax.
The Green Party is also calling for a carbon cap-and-trade system to be put in place.
But critics say that plan would not help the economy.
“There’s no doubt that carbon emissions are increasing, but the carbon price is not going up,” said Andrea Kammerer, an economist with the German Marshall Fund of the United States.
“That is a completely wrong solution.”
The German Federal Energy Agency estimates that the government’s proposed cap-on-a-plate system would cost about €400 ($460) per ton of CO2 emissions, compared to the $1,100 ($1,460) the government currently pays for carbon credits.
So even if the government decided to introduce a cap-a, cap-off-a system, the amount it would cost would