Moves to loosen restrictions on fracking to face strong opposition in Germany


18 Feb 2015

Moves to loosen restrictions on fracking to face s...

The German government’s proposal to loosen its ban on hydraulic fracturing, or fracking, boosts the prospects for shale gas and represents a major opportunity for the country to diversify its energy supplies. However, the likelihood of concerted opposition to the draft law among some political, environmentalist and community groups means that the development of Germany’s fracking industry remains uncertain. The experience of other European countries, including Poland and the UK, provide valuable lessons and demonstrate some of the challenges fracking supporters and companies will face.

The draft law proposed by the German government would allow fracking at depths beyond 3,000 metres and create an expert panel to evaluate proposed wells at shallower depths on a case-by-case basis. If approved, the law would see the panel established in 2018, with fracking underway within a year.

Chancellor Angela Merkel’s ruling coalition introduced a moratorium on fracking in 2013, and the dramatic turnaround is the result of challenges facing the government’s ‘Energiewende’ initiative, rising energy costs and the appeal of gains witnessed in other shale drilling countries, notably the US, in increasing energy independence. The ‘Energiewende’ initiative launched in 2011 was intended to encourage a determined transition from coal, oil and nuclear energy, to renewable and more efficient sources of energy. The decision in 2011 to close the country’s nuclear plants by 2022 will result in a major loss of electricity supplies, with nuclear representing 15.4 percent of electrical production as of 2013. Germany’s sizable shale gas reserves – estimated to be as much as 2.3 tn cubic metres – also represent an opportunity to strengthen domestic energy production at a time of ongoing sensitivity to Europe’s reliance on Russian gas imports due to geo-political events. Furthermore, the integration of European energy markets which could help longer-term pricing and supply fluctuations are progressing extremely slowly and unlikely to manifest significantly this decade.

Notwithstanding these financial and geo-political drivers, the existence of a large environmental movement in Germany and heavily politicised nature of fracking will slow the loosening of restrictions on the industry in the near term. Maria Krautzberger, head of the country’s federal environment agency, spoke favourably of the draft law, but warned that it left the government in a “sandwich position” between the industrial and environmental lobbies. Opposition also exists within political groups, including Chancellor Merkel’s own ruling coalition. For instance, the Social Democrat Party’s Hannelore Kraft – governor of North Rhine-Westphalia – has pledged to prohibit fracking in her state.

Despite assurances from officials that the minimum depth of 3,000 metres will prevent any potential threat to ground water supplies, environmental groups will sustain their opposition to fracking. There are a number of well-established environmental groups in Germany including some specifically targeting fracking, particularly in North Rhine-Westphalia and Lower Saxony, where the country’s deposits are concentrated. Groups such as the Association of Citizens’ Initiatives for Environmental Protection (BBU) and No Moor Fracking claim that the practice poses a threat to drinking water supplies and can cause minor earthquakes. Past protests against the nuclear industry in Germany have demonstrated the capability of the environmental movement to organise mass demonstrations against the energy industry. Activists will also likely condemn the questionable impartiality of three members of the proposed six-member expert panel. The three all signed the Hanover Declaration, a paper signed by scientific and industry experts in 2013 calling for the extraction of shale gas in order to stabilise the declining production of natural gas in Germany.

Political and public resistance elsewhere in Europe in recent years is indicative of the challenges that energy companies will face in using fracking to develop Germany’s shale gas resources. The Polish government pledged in 2010 to boost its energy independence, largely through the exploitation of the country’s shale reserves. However, major protests followed, including a 400-day blockade at a Chevron shale site at Zurawlow that saw the US-based oil giant eventually abandon the site in July 2014. Although Chevron later exited Poland’s shale gas sector entirely amid disappointing exploration results, the protest at Zurawlow demonstrated the potential of localised activism movements to disrupt operations. Protests at proposed well sites have also been common in the UK, where activist groups like Frack Off have emboldened both public and political opposition to fracking. The strong opposition and media attention surrounding the issue has forced politicians to reassess legislation governing fracking and thereby slowed down the issuance of drilling permits and development of the sector. New measures introduced in January 2015 ensure that fracking may only occur in the UK under strict environmental regulations, necessitating environmental assessments, consultation with residents and a ban on wells in protected areas.

Although the types of direct action witnessed at drilling sites in the UK and Poland are not likely at this very early stage, it will be a major future operational and security consideration for drilling companies if the industry develops. Before this however, the build-up to the vote on the draft law in the Bundestag in May will likely generate public protests. The approval of the law is not assured but if it does proceed, while being a major development for the prospects of the sector, policy progress will be slow and a boom in Germany’s shale sector is not anticipated in 2015.

 

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