text: German doubts about fracking could prove costly | Reuters
  February 18, 2013 / 5:45 PM / in 5 years
  BERLIN (Reuters) - Opposition from Germany's powerful environmental lobby is dimming prospects for shale gas and sparking fears that major industries in Europe's largest economy will lose out to U.S. rivals tapping cheaper energy.
  File picture shows a natural gas well drilled near Canton, in Bradford County, Pennsylvania January 8, 2012. Opposition to shale gas from Germany's powerful environmental lobby is sparking fears that major industries in Europe's largest economy will lose out to U.S. rivals tapping cheaper energy. Opponents to the hydraulic fracturing, or fracking, used to drill for shale are stepping up their arguments about the environmental risks it could pose while industry leaders urge the government to draw up rules to allow exploration. Picture taken January 8, 2012. TO MATCH STORY GERMANY-FRACKING/ REUTERS/Les Stone/File
  Energy-intense sectors such as chemicals which are important to Germany's economy face paying three times what their U.S. rivals pay for gas through 2030, according to influential industry lobby group BDI.
  "If we immediately reject this, we will end up as international laggards," BDI chief Ulrich Grillo said this month regarding shale gas.
  Industry's voice counts in Germany, where manufacturing accounts for at least 25 percent of the economy, with top employers that include BASF, Bayer as well as the steel and heavy engineering sectors.
  "It is becoming a very potent issue in Germany," said Miranda Schreurs, director of Berlin's Environmental Policy Research Centre and a member of the German Advisory Council on the Environment which advises Merkel's government.
  "The reality is that the rising costs of the energy transition will probably mean the issue will have to be looked at seriously."
  Germany's politicians have been busy arguing the merits and dangers of drilling. Security experts discussed the issue at the Munich Security Conference and the BND intelligence agency has analyzed its geopolitical impact.
  The Greens, Europe's most successful ecological party, have grown into a political force with some chance of a return to government this year after ruling with the Social Democrats (SPD) between 1998 and 2005.
  The Greens also share, or are about to share, power in six of Germany's 16 federal states, including North Rhine-Westphalia (NRW) and Lower Saxony, home to Germany's biggest shale gas reserves.
  Individual states are responsible for issuing fracking permits and NRW's environment minister, a member of the Greens, has imposed a de facto moratorium on licenses due to public concerns.
  "There is a need for further investigation and research to understand it and come up with a (regulatory) framework," the minister, Johannes Remmel, told Reuters.
  File picture shows a natural gas well drilled in a rural field near Canton in Bradford County, Pennsylvania January 7, 2012. Opposition to shale gas from Germany's powerful environmental lobby is sparking fears that major industries in Europe's largest economy will lose out to U.S. rivals tapping cheaper energy. Opponents to the hydraulic fracturing, or fracking, used to drill for shale are stepping up their arguments about the environmental risks it could pose while industry leaders urge the government to draw up rules to allow exploration. Picture taken January 7, 2012. TO MATCH STORY GERMANY-FRACKING/ REUTERS/Les Stone/File
  "Germany is quite likely over time to import either shale gas or electricity produced from shale from other countries such as Poland or Ukraine," said Nick Butler, a visiting fellow and chair of King's Policy Institute in London.
  Butler, a former UK government adviser, estimates that imports could allow shale gas to make up a little under 10 percent of Germany's energy market in the next decade.
  "The numbers show the huge contribution it could make," said Miriam Strauch of the WEG gas association, arguing Germany should look to its own resources instead of imports.
  Schreurs at the Environmental Policy Research Centre argues that shale gas at the very least could help before Germany's "green revolution" takes full hold.
  "It could be a transition energy. As you build up more renewable energies you need a baseload that is stable. Natural gas could give that," Schreurs said. "(Shale) may save the energy shift because it could be a way to make it still affordable to industry."
  The BDI estimates Germany's nuclear phaseout and switch to renewables, which need subsidies to operate profitably, will cost up to 350 billion euros ($467 billion) by 2030.
  "I don't really see substantial quantities of shale gas production in this decade in Europe," said Rainer Seele, chief executive of Wintershall, which has two concessions in NRW. "The potential is there, but we have to see whether it will work."
  A repeat of Merkel's center-right coalition would offer the best chance for moving ahead with exploratory drilling.
  Yet even within Merkel's coalition there are divisions, with conservative Environment Minister Peter Altmaier at the weekend again taking a cautious line, reiterating he wanted to limit fracking.
  "Many German firms have opted for (relocation to) the United States, saying energy prices were the decisive factor. We are already suffering with our higher energy prices, it affects our own competitiveness," he said at a conference this month.
  Additional reporting by Vera Eckert, Christoph Steitz in Frankfurt and Barbara Lewis in Brussels; editing by Noah Barkin and Jason Neely