- German energy chiefs have warned that Germany will face a shortage of electricity
- After the government decided to shut down the remaining nuclear plants.
Business leaders have warned that vital industries are facing power shortages that will plunge the country after the government decided to close its last remaining nuclear power stations in favor of renewable energy sources.
The head of energy firm RWE says Germany is concerned that a country in crisis could face electricity shortages that could lead to inflation.
Markus Kreber, 50, warned that this would threaten Germany’s ‘competitiveness’ as an industrial hub, meaning companies would leave the country and take many essential jobs with them.
‘Germany’s prosperity is based on strong industry,’ Krebber told BLD. Less energy supply leads to higher prices – this threatens the competitiveness of Germany’s industrial environment. We are seeing the first signs of an industrial shutdown.’
His surprise warning follows Germany’s slide into recession – as Brexit means Britain’s economy is expected to grow by 0.4% in 2023 – and to avoid a similar recession.
Germany’s energy chiefs have blamed the country’s poor outlook on the government’s green energy ‘danger’ to shut down its last remaining nuclear power plants. Instead, the focus is now on renewable energy supplies from solar and wind farms.
But the fact that these green energy sources are vulnerable to sudden drops in cloudy or windy conditions means Germany’s electricity system is vulnerable to electricity shortages and price volatility.
Krebber warned that this could cause serious damage to German industries trying to boost the country’s weakened economy.
Kreber told Focus: ‘As an industrial area, Germany has a serious problem: we don’t have as much energy as we need.’
All of this is playing into the hands of Germany’s far-right parties, with the Alternative for Germany (AfD) rising in popularity in the polls as it criticizes what it calls an expensive green agenda.
Some voters in the AfD, which argues that human activity is the cause of climate change, are concerned about the costs of transitioning away from fossil fuels.
AfD leader Tino Krupala said many voters appreciated the policies of the Greens, Scholz Jr.’s coalition partner, who wanted a rapid transition away from hydrocarbons, bringing them ‘economic war, inflation and industrial collapse’.
We are the only ones who do not form alliances with these dangerous greens.
Christian Kuhlmann, chief executive of chemicals group Evonik, joined Kreber in criticizing the government’s ‘energy policy risk’ and warned of the impact on German industry.
‘In Germany we pay the highest prices in the world for electricity and energy, and every industry, every economy exists and depends on an affordable, cheap and available supply of energy,’ said Kuhlmann, 54.
Kuhlman warned that Germany, historically an engineering center, would not produce mass goods in the country.
“We may be saying goodbye to these industries in the near future — and not for long,” Cullman said with a stark warning. ‘Germany is under pressure as a business location.’
RWE CEO Roland Farnung, 82, added: “The energy policy now approved by the federal government acts on the open heart of society and is a big threat to German companies and jobs here.”
To combat Germany’s vulnerability to electricity shortages, there needs to be a ‘huge investment’ in green energies, Krebber said. But even with this investment, German power plants must continue to use the country’s energy system at a high speed.
“The will and the money are there,” Kreber said. [investments in green energies]. For investments to materialize, a reliable framework that creates incentives rather than obstacles is needed in the long term.’
And some experts say that if it wants to phase out fossil fuels and become greenhouse gas neutral across all sectors by 2045, it will eventually have to go back to nuclear, as wind and solar power do not fully cover demand.
By ending nuclear power, Germany is committing itself to coal and gas because there isn’t always enough wind or sunlight, said Rainer Kluth, head of the pro-nuclear Association.
The German government has dismissed this threat, saying that thanks to Europe’s integrated electricity network, Germany is a net exporter and can import energy whenever it wants.
But German business leaders are still warning that Germany could face electricity shortages, which could drive businesses away – and that such a move would hurt Germany’s struggling economy.
Indeed, last month, Germany was declared in recession after the country experienced an unexpected decline in the first quarter of the year.
Germany’s gross domestic product (GDP) fell by 0.3 percent between January and March, according to data from the Federal Statistical Office.
The figure comes as a major setback for the German government, which has boldly doubled its growth forecast for this year as winter energy shortages fail to materialise.
It predicted that GDP would grow by 0.4 percent – from the 0.2 percent expansion forecast at the end of January – which would now have to be revised downwards.
According to German newspaper Bild, the country’s economy ‘shrunk’ by 0.5 percent in the winter quarter of 2022.
It comes as the International Monetary Fund has been forced to admit it miscalculated its forecast for Britain’s economy after Brexit, despite doom and gloom from Remainers who describe EU membership as an economic imperative.
The Foundation now expects the UK economy to grow by 0.4 per cent in 2023, despite announcing a 0.3 per cent contraction last month.
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