13. April 2021 | Position
The chemical-pharmaceutical industry supports the goal of the energy transition (Energiewende) to make energy supplies climate-friendly, reliable and affordable. The industry actively contributes to greenhouse gas cuts. In 2019, the VCI highlighted in a study how the German chemical industry can achieve greenhouse gas neutrality by 2050 in technological terms.
For this, the industry needs well over 600 TWh of renewable electricity at a price of 4 cent/kWh. On the platform Chemistry4Climate, the industry is working with other major stakeholders to develop a sound concept for how to provide such volumes of electricity at the said price.
Compensation for cost increases
Many energy policy rules have cost-increasing effects on the industry. This hampers progress on the way towards more climate protection, as low-emission processes only become possible with favourable electricity prices. Last but not least, high electricity prices are a considerable disadvantage in international competition for energy-intensive industries such as chemistry.
Promoting the expansion of renewables also brings further costs for the chemical industry. Irrespective of burden-easing measures for highly energy-intensive companies, the chemical industry is currently paying over 1.2 billion euros p.a. in EEG charge (EEG-Umlage) alone. Additional costs are threatening from the accelerated coal phase-out which renders electricity production more costly, and from the new fuel emissions trading act (BEHG). In the first case, compensation of additional costs is intended. In the second case, the burden-easing rules involve high bureaucracy costs.
The planned burden-easing measures as well as constant security of electricity supplies are essential for the international competitiveness of energy-intensive industries.
Moreover, effective impulses for limiting the costs for the market integration of renewable energies are lacking. In particular, grid fees and further charges are rising due to the necessary grid expansion and the power plant reserve. Measures are needed to ensure reliable supplies but they must be shaped as cost-efficiently as possible.
Role of own electricity supplies
Cogeneration ensures the supply of heat and electricity in a climate-friendly way. However, the most recent amendment to the German renewable energies act (EEG) adversely affects the economic viability of such plants.
Electricity consumption will climb
Electricity is going to become ever more important in the future – for example, for the electrification of industrial processes. Technologies with lower CO2 emissions can become established only if competitive prices for the required electricity are guaranteed in the long term - while the EEG charge, in particular, causes an artificial cost increase in electricity consumption. Therefore, burden-easing from the EEG charge is vital for energy-intensive industries. The adopted limitation of the EEG charge to 6.5 cents/kWh is merely the proverbial drop in the bucket.
THE VCI IS CALLING FOR THE FOLLOWING
- Reduce the costs to a minimum
New laws should not bring further burdens which then necessitate relief measures for energy-intensive plants. The fuel emissions trading act (BEHG) is a negative example: the compensation rules adopted by the federal cabinet are not sufficient and set overly high hurdles.
- Compensation for electricity price increase in compliance with state aid legislation
Regarding the electricity price increase that is expected from the coal phase-out, the German federal government should negotiate with the EU Commission a compensation regime that complies with state aid legislation.
- Make the expansion of renewables more cost-efficient
The further expansion of renewable energies production is important for climate protection. However, this requires an alternative funding concept which does not strain the chemical industry.
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