Energy: Europe's banks brace for power outages - Economy


Due to possible power shortages or even power failures, the banks in Europe are under pressure. Due to the importance of payments and transactions for the European economy, which is already burdened by the consequences of the war in Ukraine, the pressure on financial companies to act is high. Regulators are on high alert. The European Central Bank and the British Prudential Regulation Authority (PRA) require banks to have contingency plans to deal with possible power shortages. Experts fear that hardly any institute is prepared for longer power outages of more than a few days. "This represents a serious gap in resilience planning," said Avi Schnurr, executive director of the Electric Infrastructure Security Council, a think tank that advises on preparedness for such threats.

Banks would have to take precautions to ensure that they could survive a longer period of time Power failure get by For example, they should make agreements that transactions will be logged retrospectively once the systems are back online, he said. "The banking system is part of other systems," explains Gianluca Pescaroli, professor of business continuity and disaster resilience at University College London, who has advised the authorities in London. "My main concern is the cascading impact on society of ATM failures or non-cash transactions, as well as banks' dependencies on other services such as the Internet."

The war in Ukraine and gas cuts by Russia have caused energy prices to skyrocket across Europe. To make matters worse, a number of nuclear power plants in France are shut down for repairs and the country is dependent on electricity imports. As a result, there is a growing fear of power shortages or blackouts in winter. All are requested energy to save.

Deutsche Bank turns off the hot water

The banks are also participating and testing how they could cope with a power shortage. They install alternative energy sources such as generators in case of emergencies, so that ATMs and online banking do not go down, and take cost-saving measures. The US bank JP Morgan, with thousands of employees in London and Frankfurt, has already simulated power outages. Depending on the severity, the bank could switch to diesel generators, which could keep key office locations running for several days.

Italy's second-biggest bank Unicredit also tested its operational resilience this summer, an insider says. The institute is mainly responsible for data processing. The bank's two central data centers would be powered by two independent power plants. It is unclear how long they will last.

Meanwhile, Deutsche Bank is reducing its energy consumption. A number of energy-saving measures have been introduced in the 1,400 buildings in Germany, said Germany's largest financial institution. The aim is to save 4.9 million kilowatt hours (kWh) of electricity annually - enough to operate around 49,000 light bulbs for an hour. The bank turned off hot water in the washrooms, adjusted the temperatures at the workplaces and switched off the indoor branch lighting and the illuminated outdoor advertising overnight. The fountain in front of the head office in Frankfurt will also be switched off.



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