Germany, the largest economy in Europe, is expected to record the lowest energy consumption this year since the beginning of statistical data publication, according to Bloomberg
According to estimates made by the Think Tank Working Group on Energy Balances (AG Energiebilanzen), this year, it is projected that Germany’s total energy consumption will reach 10,784 petajoules (equivalent to 2,996 terawatt-hours), which is 8% lower than the consumption recorded in 2022 when the European energy crisis had a significant impact on Germany.
Furthermore, this energy quantity is 28% lower than that of 1990, the year when statistical data collection on energy consumption began.
Experts from AG Energiebilanzen have noted that Germany’s energy consumption has been significantly influenced by its economic performance. This year, it is anticipated that Germany’s GDP could decrease by up to 0.5%.
This economic contraction has particularly affected energy-intensive industries, leading them to reduce production and, consequently, consume less energy. Additionally, higher temperatures compared to the previous year have contributed to a decrease in energy demand.
According to AG Energiebilanzen’s estimates, approximately 20% of the total consumption decrease can be attributed to favorable weather conditions. Additionally, the high price of energy has led to cost savings and reduced production in energy-intensive industries.
Earlier this week, the International Energy Agency announced that Germany’s demand for petroleum products in 2023 may experience the largest decline among OECD member countries. Furthermore, starting from May this year, Germany has become a net importer of electricity as the last nuclear reactors were shut down.
At the beginning of October, the German government issued an announcement forecasting a contraction of the economy by 0.4% for this year, as a result of persistent inflation, high energy prices, and a decrease in international trade.
These revised forecasts sharply contrast with the earlier estimate of economic growth of 0.4% projected in April for the current year. Nevertheless, the Berlin government envisions a subsequent recovery of the Gross Domestic Product, with a growth of 1.3% in 2024 and 1.5% in 2025 following the 0.4% contraction expected in 2023.