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10 INTERNATIONAL NEWS 23.12.2021 THIS year's energy crunch is threatening to derail Europe's economic recovery as gas and electricity costs soar to fresh re- cords. Prices surged more than 20% on Tues- day after Russia curbed gas flows to Eu- rope and France, usually a power export- er, was forced to boost electricity imports and burn oil to keep the lights on. Higher costs have forced some companies to shut down or curb output, while inflation in the euro zone climbed to an all-time high last month. e energy crunch is deepening just as the coronavirus omicron variety spreads across Europe, darkening the region's eco- nomic outlook. Costs are also adding to supply-chain snarls that have upended in- dustries from car makers to wind turbine manufacturers. Food producers are also feeling the pinch, with the cost of ener- gy-intensive fertilizers surging. "It's not only the cost of energy that's a problem right now, we have all these supply-chain issues," said Anne-So- phie Corbeau, a research scholar at the Center on Global Energy Policy at Co- lumbia University. "Eating and heating are very important things. Right now, a lot of people might have problems with heating, but you might have problems with eating because fruit and vegetables are expensive. Everything is becoming quite expensive." Gas futures surged as much as 28% as Russian gas flows into Germany via a key route dropped to zero, and were instead moving eastward to Poland, according to network operator Gascade. is is likely to continue on Wednesday. German power for next year jumped as much 25%, while the French contract gained 26% as nuclear outages bite, forc- ing six oil-fired units to be turned on in France on Tuesday morning, according to a filing with Entsoe. in trading due to the holiday season also contributed to the gains. Electricite de France SA said last week it would halt four reactors accounting for 10% of the nation's nuclear capacity, straining power grids already coping with freezing weather. About 30% of France's nuclear capacity will be offline at the be- ginning of January, and to make matters worse, Germany is closing 50% of its reac- tors before the end of the year. e power shortages means Europe needs to burn more gas just as Russia has signaled its supply will remain capped next month. Lower supplies into Germa- ny will force Europe to keep withdrawing gas at high rates from its already depleted storages, risking a prolonged deficit of the fuel well into next winter. "ese exciting times will continue for a bit longer and will probably not end be- fore the winter ends," said Hans van Cleef, a senior energy economist at ABN Amro. "Depending on how much inventories will be left by then, the price effects of current shortages could last even much longer." e energy crunch is so severe that Tra- figura's Nyrstar will pause production at its zinc smelter in France in the first week of January because of rising electricity prices. Norwegian fertilizer producer Yara International, which curbed output earlier this year, said it would continue to monitor the situation closely and cur- tail production where necessary, while Romanian fertilizer company Azomures temporarily stopped production due to higher gas prices. "I'm worried about one thing: the cost of fertilizer products," Corbeau said. "is is going to bite us eventually in terms of the cost of food and this isn't going to have an impact on Europe, this is going to have an impact in a lot of countries." e French government has asked EDF to restart some nuclear reactors earlier than planned. Ecology Minister Barbara Pompili said this weekend that in addition to the early reactor restarts, the country had contracts with some companies in which they agreed to cut production dur- ing peak demand hours in exchange for payments from the government. Freezing temperatures spreading across the continent this week also aren't help- ing, and Europe's vast network of renew- able sources just can't keep up. German wind output plunged to as low as 1,231 megawatts on Tuesday, the lowest since Nov. 16. Benchmark European gas prices traded in the Netherlands closed at an all-time high of 180.27 euros a megawatt-hour. German power for next year settled at 315.99 euros a megawatt-hour. WIZZ Air will base four additional Air- bus A321neo aircraft at London Gatwick as the low-cost competition heats up at London's secondary airport. e airline made the announcement after it received 15 daily slot pairs at the facility from a former Gatwick heavyweight, Norwegian Air Shuttle. Norwegian's Boeing 737s and 787s used to be a common sight at London Gat- wick Airport. However, since the almost collapse of the low-cost giant, the fleet's presence at London's secondary airport has been scarce, meaning that its slots ha- ven't been used. is wasn't such a problem at the height of the pandemic when no slots were being used, but as the recovery progresses, they have now found a new owner. Enter Wizz Air Just over a year ago, in October 2020, Wizz Air launched a base at London Gatwick Airport, despite the ongoing pandemic. Fast forward to today, and there is still only one Airbus aircraft based at the airport, with the airline's CEO pre- viously revealing his displeasure that additional slots remained blocked. This was especially the case as they weren't being used at the time. Things have now changed, though. Today, Wizz Air revealed that it had successfully acquired 15 pairs of daily slots from Norwegian Air Shuttle. The low-cost carrier told that its UK subsidiary would make the most of the slots, with the fleet base set to grow from one aircraft to five A321neos. The main brand, Wizz Air Hungary, will also use a handful of the slots for flights out of its Budapest base. Alongside the announcement, the airline also called for the UK Govern- ment to bring back so-called "use it or lose it" rules on slots. The airline would like to use other airlines' slots that have remained dormant through- out the crisis. Commenting on the move, Wizz Air's CEO, József Váradi remarked, "Acquiring airport slots at Gatwick Airport will enable us to enhance our presence and competitive position in the London market. We continue to develop our business in United King- dom and remain committed to mak- ing air travel affordable for all. The 2022 season has the potential to be a tremendous opportunity for UK avi- ation to get back on its feet." More competition for British Airways? The move will likely come as a bit of an additional headache for the UK flag carrier, British Airways. For years, the airline's short-haul business from London Gatwick has lost money. All bar four of its routes were served by competitors, typically offering lower prices. This included easyJet, Ryanair, and Wizz Air. In a bid to remain competitive, Brit- ish Airways had revealed that it would be launching a new subsidiary out of London Gatwick. Known as BA Eu- roflyer, passengers should theoreti- cally not tell the difference between it and British Airways. That is except for fares. On its own AOC, the airline will look to have cheaper running costs so that it can offer "fares competitive with those of Gatwick no-frills carriers." Europe energy crunch threatens recovery Wizz Air gets 15 daily London Gatwick slot pairs from Norwegian

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