Germany's presidential palace in Berlin is no longer lit up at night, the city of Hannover is shutting off hot water to showers in its pools and gyms, and municipalities across the country are preparing heating shelters to keep people out of the cold. And this is just the beginning of the crisis that will engulf the whole of Europe, Bloomberg reported.

Germany has little time to prevent an energy shortage this winter that would be unprecedented for a developed country. Much of Europe is under pressure as Russia cuts off natural gas supplies, but no other country is more at risk than the region's largest economy, where nearly half of homes rely on fuel for heating.

Chancellor Olaf Scholz's administration has been slow to address Germany's vulnerability, having only recently set demand-reduction targets as efforts to secure alternative supplies fail. As Moscow continues to cut supplies and France struggles to export power to its neighbors, no respite is expected and the risks extend beyond this winter.

Rationing and recession are looming in Germany, and authorities have expressed concern about social unrest if the energy shortage gets out of hand. The country can't even count on France, where malfunctioning nuclear reactors are exacerbating the gas crisis. Electricity prices in Europe's two largest economies rose to record highs last week.

If measures to restore the balance between supply and demand fail, the government has the power to declare a gas "emergency", requiring the state to take control of distribution and decide who gets the fuel and who doesn't.

While households and critical infrastructure such as hospitals are protected from outages, there is no guarantee that room temperature will be as comfortable. Germany's biggest landlord has already announced plans to cut heating at night, and public buildings, including the Reichstag in Berlin, are turning off thermostats.

The cost increase, which will begin to seep seriously this fall, will increase the pressure on the poor. According to the Cologne Institute for Economic Research, about one in four Germans have already fallen into energy poverty, which means that spending on heating and lighting affects the ability to cover other expenses. The government is currently working on programs to help low-income families.

A cold snap in Europe and Asia will force energy companies to fight for already limited supplies of liquefied natural gas. According to Penny Leak, an analyst at consultancy Wood Mackenzie Ltd., rising prices from such a scenario could prompt companies to shut down production and wipe out about 17% of industrial demand for fuel. “If Nord Stream flows stay at 20%, we will move closer to the danger zone,” she said.

With storage at 68% full, Germany risks missing the government's target of 95% by November 1st. The country's network regulator says that reaching this level is hardly possible without additional measures.

The corporate sector is already responding. A survey of 3,500 companies in the DIHK business lobby found that 16% of industrial firms are considering cutting production or abandoning certain operations due to the energy crisis.

BASF SE is one of them. The chemical giant plans to cut its gas-intensive production of ammonia, a key ingredient in fertilizers, after rising costs made the business unprofitable. The company also plans to partially convert electricity and steam production at its main site in Ludwigshafen to fuel oil, which will help free up gas for sale back into the grid.

 High energy prices prompted fertilizer maker CF Industries Holdings Inc. announce the closure of one of its factories in the UK.

Cargill Inc., the world's largest grain trader, has also closed a UK oilseed processing plant, and in France, supermarkets including Carrefour and Monoprix have agreed to cut energy consumption.

The International Monetary Fund estimates that Germany risks losing 4.8% of its output if Russia cuts off gas supplies, with the Bundesbank estimating a potential damage of 220 billion euros.