The chemical industry in Germany is suffering particularly badly from the rise in gas prices. In an interview with ntv.de, Managing Director Wolfgang Große Entrup from the industry association VCI warns of unsolvable problems and explains why companies do not want to save even more gas.
ntv.de: In view of the energy crisis, the chemical industry is facing a bleak future. How warm do companies have to dress in winter?
Wolfgang Große Entrup: That mainly depends on the temperatures in the coming weeks. Unfortunately, no one knows what kind of winter is coming. Production planning based on the weather app, who would have ever thought it possible? Simply a disaster for a company. We are therefore looking to the future extremely critically and with deep concern. The skyrocketing energy prices are hitting our industry brutally. The supply contracts of many medium-sized companies are about to expire. The new conditions will pose unsolvable problems for a number of companies. Many medium-sized companies have their backs to the wall. Especially in international competition, many can no longer pass on the prices and are therefore already planning step by step to stop their production.
Which companies have it particularly difficult?
Companies in particular that are in international competition are having brutal problems at the moment. No other industrial sector in the world has the burdens that German companies are currently having to cope with. The surcharge planned by Economics Minister Habeck, which is on top of our gas price, corresponds to the gas price in the USA. German companies are therefore completely sidelined on the world market.
In order to remain competitive, companies could move their production abroad.
This is already happening because certain products can no longer be manufactured economically in this country. Keyword ammonia. And the bottom line is: Ammonia is not just a fertilizer, but a basic chemical that is used in many areas – from automotive paint production to the pharmaceutical industry. What is possible for large internationally operating companies is not an option for many regionally anchored medium-sized companies without production facilities abroad.
What does it mean for the industry when companies migrate?
If companies shut down their production or shut it down completely, entire value chains collapse with a domino effect. That would be a catastrophe for Germany as a whole as a business location. Then not only a recession threatens. The sirens are wailing very loudly at the moment. We are just a small step away from becoming an industrial museum from one of the largest industrial sites in the world. We must now do all we can to lower energy prices and keep industry competitive. Production that is now being shut down and that we are losing abroad is unlikely to come back.
How serious is the threat of deindustrialization?
Very seriously. What got us out of the crises of the past few years was the industrial core in Germany, our added value. That threatens to collapse. Should it come to that, the situation in Germany threatens to deteriorate dramatically.
Some companies are switching their production back to oil or coal because of the high gas prices. Is that more than a drop in the bucket?
The effect will not be particularly large as the majority of companies will not be able to do this in the short term. The transition to oil requires tremendous effort and investment. Some companies have come a long way, but don’t get permission for a tank to store the oil in, for example – it’s not exactly made easy for them.
Germany actually wants to get away from coal, oil and nuclear power. Shouldn’t the chemical industry have switched to renewable energies much earlier?
We have been fighting for years to ensure that as much regenerative energy as possible comes onto the market because we need it for the transformation of our industry towards climate neutrality. However, we would need 8,000 kilometers of lines through Germany for this, which are not being laid because the population does not want it. We would need an infinite number of wind turbines that are met with considerable skepticism where they are to be built. Yes, we are not where we could be in terms of expansion. There’s no way we’re where we need to be. But you also have to see the proportions: As the chemical industry alone, we need all of the electricity demand in Germany today for our transformation. But as green electricity. And we need it at all our locations. So not just in the north, where the wind blows, but spread across the whole country.
How much more gas can the industry save?
We use gas not only as an energy source, but also as a raw material. As a raw material, gas cannot be replaced in the short term and we are trying everything that is possible on the energy side. In recent months, the chemical industry has reduced its gas consumption by 15 to 20 percent. We’re already more efficient than ever before and don’t want to save even more gas, because that’s only possible if we cut production even further.
How much will the planned gas levy cost the chemical industry?
We are assuming a total burden of four billion euros per year. In addition to the already astronomical gas prices. We therefore say very clearly: the gas levy must be covered by the federal budget. The government must now actively intervene and secure the industrial structure. Better to take money in hand now and keep the industry alive than to finance large-scale unemployment in six months. One thing is clear: From our point of view, this also requires a temporary suspension of the debt brake. The future of our society is at stake now.
What else needs to be done?
We now have to connect all energy sources to the grid or continue to operate them as quickly as possible in order to save gas and keep electricity prices down. This includes renewable energies as well as coal and nuclear power. And for the future this means that we must no longer just rely on the solidarity of the world when it comes to energy issues, but must also make our own contribution on our own responsibility.
Juliane Kipper spoke to Wolfgang Große Entrup
