For years, one EU nation after another has succumbed to the 'climate change' hysteria and have taken their most reliable and affordable energy production capabilities offline because they utilize the dreaded fossil fuels. Worse, the same countries had begun shuttering the only energy production plants that produced no emissions whatsoever -- nuclear power plants -- because again, the greenies don't like nuke power, either.
But it was all just a rouse. As European countries shunned fossil fuels so they could appear to be 'woke enough' for the lunatic climate change left, they continued to rely on Russian fossil fuels, namely oil and natural gas. After Russia invaded Ukraine and the EU decided to sanction Moscow by shunning its cheap energy, Euro leaders are beginning to see just how stupid it was to dismantle their energy production facilities.
And now they are rushing to reconstitute as much of it as they can, only, it's going to take a whole bunch of money to do so -- likely trillions. And while the bailout efforts have begun in several countries including Finland, Austria, and Sweden, they are likely too little and, probably, far too late (for the record, Trump warned Germany in 2018 that the country was becoming too dependent on Russian energy, and Berlin's diplomats only smirked...again, Trump gets the last laugh).
Speaking of Germany, the EU's largest economy is likely going to be the first to collapse, notes Zero Hedge:
Credit Suisse repo guru Zoltan Poszar published what may have been the most insightful snippet of the entire European energy crisis (to date) when he extended the infamous "Minsky Moment" framework to Europe, and specifically Germany, which he said "can’t cover its payments without Russian gas and the government is asking citizens to conserve energy to leave more for industry." He then elaborated that "Minsky moments are triggered by excessive financial leverage, and in the context of supply chains, leverage means excessive operating leverage: in Germany, $2 trillion of value added depends on $20 billion of gas from Russia… …that’s 100-times leverage – much more than Lehman’s."
"The European Union and its 27 member states have invested more money, effort, and political capital in energy policy than any other region in the world. Until this year, Europe was admired globally as the gold standard for energy and climate policy. Germany’s Energiewende — or energy transition — was especially touted as a shining example of how to green the energy supply," Foreign Policy reported in the latter part of July, an attempt to sound the alarm that few EU leaders apparently heard.
"No one aspires to emulate the Europeans today. Germany and the EU have spiraled headfirst into the globe’s worst energy crisis since the Arab oil embargoes of the 1970s and 1980s. All across the continent, Europe’s energy policies have led to astronomical price increases, industry shutdowns, potential energy shortages, and geopolitical vulnerability," the analysis continued.
"Germany, in particular, is in crisis mode and will likely see much worse, as its entire economic model — based on energy-hungry manufacturing, cheap Russian gas, and a self-mutilating shutdown of nuclear energy that Berlin still won’t reverse — is on the verge of collapsing without a plan B. In short, Europe is in a mess of its own creation," it added.
There is no quick way to get shuttered energy production plants back up and running quickly. That takes careful preparations, lots of maintenance, and more than anything, workers. So the continent is not likely going to have a good winter, and more than one EU member will be lucky if their economies don't fully collapse in the meantime.
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