Germany is well aware of the fact that its refusal of Russian gas will cost it dearly. Indeed, recent estimates showed that Germany would need around €1 trillion to replace Russian gas. German economist Jens Ehrhardt is sure that €1 trillion is the price Germany will pay for the transition from the Russian gas supply. The expert warns that Germany has difficult times ahead as the aftermath of Russian sanctions and the risk of reduced gas supply will hit it hard. “High inflation, the geopolitical crisis and high debt levels are a burden. We will feel it in Germany,” he says. Jens Ehrhardt explains that Germany will not be able to replace cheap Russian gas in the short term. This means that in the next four years, the country will do itself a lot of harm by imposing sanctions on Russia. “Expanding the capacity to receive liquefied gas will cost us one trillion euros, according to some estimates,” the expert reiterates. Later, this may lead to higher production costs which will make industries in Germany “more expensive and therefore less competitive.” Notably, Ehrhardt is not the only one who holds this view. In May, Leonhard Birnbaum, the CEO of German energy company E.ON, said that a ban on Russian gas would be catastrophic for the country's economy. He is confident that in case of a gas embargo, Germany “will have neither steel nor the chemical industry, the consequences would be dramatic.”
