The River Rhine Runs Dry: Implications For Germany & Europe
It is July. That means it is peak summer and it is presently roasting across a large swathe of the Western world.
This may not be that atypical but the temperatures are breaking records - as they seem to nearly every year - and throwing new wrenches into various economies, energy plans and grids.
As usual we are running things very close in places like California and Texas and elsewhere in the swathe of the American South that has either become overly reliant on volatile renewables or underinvested in a robust and resilient electrical grid.
But the real challenges are happening elsewhere, namely, Europe.
Europe has also been experiencing a serious heatwave and one that has arrived after a period of unusually low precipitation. This has meant terrible wildfires in Portugal, Spain, France and Greece and disruptions across the continent.
It has also meant very low river volumes.
In particular, the Rhine has plummeted to an exceptionally low volume. At Kaub, the level has shriveled to just 70 centimeters or 14.5 inches.
See here:
The Rhine river is quietly one of the major (and natural) infrastructure arteries of the European continent - flowing from the major Dutch port at Rotterdam all the way through the heavily industrialized Rhine Valley and near the major cities of Southern Germany and Eastern France.
Around 80% of inland waterway goods transport relying on this one river that passes through major cities and ports like Cologne, Dusseldorf, Rotterdam and Basel.
No doubt its low level has been noticed by the fine folks along the river itself and we are very sure that it was noticed by the always exceptionally sensitive senses of commodity traders the world over.
There is an interesting and open question of just how much it was noticed in the Kremlin. It is likely they have noticed with glee by now. As we detail below, the Putin regime now has Germany and Western Europe even more over the barrel than previously.
What is clear is there are some deeply unpleasant consequences of this development:
It creates yet another energy challenge for Germany. Many of the newly opened or suddenly strategically important coal power plants burn fuel that are shipped cheaply up and down the river's length.
It will have an impact on the already-strained German economy. Coal isn't the only freight that will be unable to be efficiently and cheaply moved by barge down the Rhine or other European rivers.
It underlines a broader energy problem for Europe: many of the thermal or nuclear plants across the continent also rely on local water sources for cooling. And we haven't even gotten to hydropower yet....
Each of these are important and distinct problems. They also, rather unfortunately, reinforce each other.
To put it somewhat extremely: if you can't burn coal then you have no power, if you have no power then your economy will crater, if your economy craters then how long before politicians start moving towards accommodating Russia.....
The irony of a country that, all of 6 months ago, was considered to be sensibly advancing down the energy transition is now desperately worried about being unable to burn sufficient coal to keep their energy intensive economy - figuratively and quite literally - flowing is profoundly striking.
We have written before about how one of the nasty issues with a poorly constructed energy policy is they make everything harder, all at once. We once detailed at some length how California's short sighted dependence on renewables make it more dependent on hydropower from other Western states and the transmission lines are very vulnerable to wildfires.
California's mistakes with renewables mean more people (and especially businesses) buy dirty diesel generators.
Germany's mistakes on shutting down nuclear and renewables while remaining very dependent on Russian energy now mean that they are desperately trying to burn more coal all the while terrified that Russia's current maintenance on a major gas pipeline might
And this is the first ever German government to include the Green party!
The chance of a major energy crisis in Europe this winter seems to grow by the week.
Our next story will keep with our Germanic theme.....
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