**Salzgitter CEO says steel and chemicals producers must commit to country, despite high energy costs**
The chief executive of steelmaker Salzgitter has warned that Germany’s big energy users must commit to the country as a base to stave off the creeping deindustrialisation of Europe’s largest economy.
Gunnar Groebler, who joined Germany’s second-largest steelmaker two years ago, told the Financial Times that if manufacturers of materials needed by industry, such as steel or chemicals, were to leave the region due to high energy costs “you run the risk of losing the whole value chain” of production.
His comments come as 32 per cent of surveyed industrial companies in August told the German Chamber of Commerce and Industry (DIHK) that they favoured investment abroad over domestic expansion — double the 16 per cent identified in the previous year’s survey — amid concern over a future without cheap Russian gas.
“If I were to follow that lead, then we are going to deindustrialise this country,” Groebler said, adding that “from a societal perspective, I think we as an industry also have a responsibility”.
The remarks come in a difficult month for German industry as several large climate-related projects, such as long-awaited rail infrastructure investments, have been thrown into doubt after the government froze payments from a climate and transformation fund.
The freeze followed a decision by Germany’s top court that €60bn allocated to the fund, designed to help decarbonise industry, was illegal.
Groebler confirmed that €1bn of subsidies promised by local authorities to help Salzgitter build plants that can run on both gas and cleaner hydrogen were secured, despite the problems surrounding the climate fund.
The company is planning to have the first of these plants running by 2026.
The German steel industry is making a big bet on future demand in Europe for so-called green steel, as it pours billions of euros into a transition that will eventually see it replace gas furnaces with technologies reliant on clean hydrogen and electricity.
Salzgitter, which is based on the outskirts of the eponymous city where it employs 5,500 people, has been bullish on the future of carbon-reduced steel and promised not to use any more coal in its production by 2033, when it expects to have cut its carbon footprint by 95 per cent.
There remains, however, a question mark over how demand for green steel would be affected if large-scale industrial environment-friendly projects were to be scrapped.
“[The funding gap] puts a lot of pressure and responsibility on the German government to actually come up with a tentative solution, and relatively quickly too,” said Groebler.
“I would really urge them to not stop the train [of decarbonisation] because if you stop, you will need much more energy to get rolling again.”
So what have we learned?
What determines likelyhood of economic collapse: Cost of Land, Energy, Taxes, Permits, Labour.
What doesn’t determine likelyhood of economic collapse: The frugality of the saxon housewife, the magic of the mittelstand, the hardworking spirit of the german worker, and the trustworthyness of the “German Brand”.
Let’s try to internalise that.
can someone erklär als wär ich fünf?
No, this is all just Russian propaganda. Germany is doing better than ever. Everyone who disagrees with that is a Putinist Nazi. /S
If even Germany can’t keep up, what chances eu have? 🙁
Germany’s chemical industry really got fucked over when Germany decided to drop nuclear power. The chemical industry needs dependable power, and quite a lot of it (because starting and stopping a process is where most chemical processes get really expensive while providing no usable output to offset those costs. In for example paint-manufacturing it can take up to a full day to restart a process).
The steel industry is slightly less fucked. If you want to produce steel with a low carbon footprint Hydrogen is one way to go, and to produce hydrogen without fossil fuels you need cheap energy rather than stable energy. Cheap wind and solar power works just fine for hydrogen production and can be a way to blunt energy overproduction (by providing somewhere to use that electricity when it’s cheap). Possibly even burn hydrogen stores for electricity on the slowest days of the year or during peak hours.
Hydrogen cells will need to be somewhat more efficient than they are now, but it’s probably only a matter of time.
Maybe all those doctors and lawyers without papers could work at the steel mill for a while?
What, eh?
“Threat of creeping deindustrialisation”? It’s not a threat, deindustrialisation is already there.
Germany can not mass produce weapons in the middle of the war.
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Article:
**Salzgitter CEO says steel and chemicals producers must commit to country, despite high energy costs**
The chief executive of steelmaker Salzgitter has warned that Germany’s big energy users must commit to the country as a base to stave off the creeping deindustrialisation of Europe’s largest economy.
Gunnar Groebler, who joined Germany’s second-largest steelmaker two years ago, told the Financial Times that if manufacturers of materials needed by industry, such as steel or chemicals, were to leave the region due to high energy costs “you run the risk of losing the whole value chain” of production.
His comments come as 32 per cent of surveyed industrial companies in August told the German Chamber of Commerce and Industry (DIHK) that they favoured investment abroad over domestic expansion — double the 16 per cent identified in the previous year’s survey — amid concern over a future without cheap Russian gas.
“If I were to follow that lead, then we are going to deindustrialise this country,” Groebler said, adding that “from a societal perspective, I think we as an industry also have a responsibility”.
The remarks come in a difficult month for German industry as several large climate-related projects, such as long-awaited rail infrastructure investments, have been thrown into doubt after the government froze payments from a climate and transformation fund.
The freeze followed a decision by Germany’s top court that €60bn allocated to the fund, designed to help decarbonise industry, was illegal.
Groebler confirmed that €1bn of subsidies promised by local authorities to help Salzgitter build plants that can run on both gas and cleaner hydrogen were secured, despite the problems surrounding the climate fund.
The company is planning to have the first of these plants running by 2026.
The German steel industry is making a big bet on future demand in Europe for so-called green steel, as it pours billions of euros into a transition that will eventually see it replace gas furnaces with technologies reliant on clean hydrogen and electricity.
Salzgitter, which is based on the outskirts of the eponymous city where it employs 5,500 people, has been bullish on the future of carbon-reduced steel and promised not to use any more coal in its production by 2033, when it expects to have cut its carbon footprint by 95 per cent.
There remains, however, a question mark over how demand for green steel would be affected if large-scale industrial environment-friendly projects were to be scrapped.
“[The funding gap] puts a lot of pressure and responsibility on the German government to actually come up with a tentative solution, and relatively quickly too,” said Groebler.
“I would really urge them to not stop the train [of decarbonisation] because if you stop, you will need much more energy to get rolling again.”
So what have we learned?
What determines likelyhood of economic collapse: Cost of Land, Energy, Taxes, Permits, Labour.
What doesn’t determine likelyhood of economic collapse: The frugality of the saxon housewife, the magic of the mittelstand, the hardworking spirit of the german worker, and the trustworthyness of the “German Brand”.
Let’s try to internalise that.
can someone erklär als wär ich fünf?
No, this is all just Russian propaganda. Germany is doing better than ever. Everyone who disagrees with that is a Putinist Nazi. /S
If even Germany can’t keep up, what chances eu have? 🙁
Germany’s chemical industry really got fucked over when Germany decided to drop nuclear power. The chemical industry needs dependable power, and quite a lot of it (because starting and stopping a process is where most chemical processes get really expensive while providing no usable output to offset those costs. In for example paint-manufacturing it can take up to a full day to restart a process).
The steel industry is slightly less fucked. If you want to produce steel with a low carbon footprint Hydrogen is one way to go, and to produce hydrogen without fossil fuels you need cheap energy rather than stable energy. Cheap wind and solar power works just fine for hydrogen production and can be a way to blunt energy overproduction (by providing somewhere to use that electricity when it’s cheap). Possibly even burn hydrogen stores for electricity on the slowest days of the year or during peak hours.
Hydrogen cells will need to be somewhat more efficient than they are now, but it’s probably only a matter of time.
Maybe all those doctors and lawyers without papers could work at the steel mill for a while?
What, eh?
“Threat of creeping deindustrialisation”? It’s not a threat, deindustrialisation is already there.
Germany can not mass produce weapons in the middle of the war.