Energy costs: Industry in Germany is moaning about the gas surcharge

 

If there is one person to be named as responsible in ruining the world’s economy and politics, we should look at German leader Scholz. His politics left Germany without reasonably priced gas. That made all other energy costs sky high. No matter what you use it is expensive. German industry is not able to compete in the market with such energy prices. The renewable technologies are not ready yet. The transition to renewables starting too early is deindustrializing Germany.

This reckless Germany’s behavior made other West countries resort to harshest available sanctions on Russia hoping that Germany’s eager participation in sanctions will make the sanctions work. China, India, Africa and South America made sure that sanctions did not work. The sanctions just hit the economy and political life of the West hard. This backlash is still playing out, it is heavy indeed.  Thank you, Mr. Scholz.

"Many industrial companies have long since begun to convert to alternative energy sources - for which at least the new gas levy is still applied.

Things get heated at Samson in the east of Frankfurt. The chemical baths into which the manufacturer's industrial valves are immersed have to be 80 degrees hot to remove all dirt and grease. The corrosion protection is then applied to the paintwork at 100 degrees. And then the surface is dried, also at 100 degrees Celsius.

In order to be able to generate so much heat, the company built its own combined heat and power plant a few years ago on the company premises in the east of Frankfurt. It runs on natural gas. "We thought we had set ourselves up for the future," says Samson boss Andreas Widl. "And now we have the cost explosion."

Energy costs doubled to nine million euros

Especially if the company is to pay the gas surcharge of 2.4 cents per kilowatt hour from October. 2.4 cents, that doesn't sound like much. But Samson consumes around ten gigawatt hours of gas a year alone. This would only result in additional costs of 240,000 euros due to the new allocation. In any case, the company expects that the energy costs will double as a result of the increased market prices, to nine million euros a year. "The state is making a big mistake with the levy," says Widl, because it is taking more and more money away from consumers and companies in the belief that the state can spend it better than they can.

Like Samson, many entrepreneurs are currently struggling with the new levy. The pipe and hose clamp manufacturer Norma expects additional costs of around 75,000 euros at the Maintal location – in the fourth quarter alone. There, metal clamps in particular are hardened and coated with the help of natural gas heat.

 

This machine supplier is not even one of the largest natural gas consumers in industry. These are mainly manufacturers of cement, lime or bricks, i.e. building materials. Temperatures of up to 1500 degrees Celsius are sometimes necessary to produce glass. The Association of Construction Companies is therefore already warning that construction costs could rise significantly again in the next two years.

 

Profits increase faster than costs

And the chemical industry is also one of the major consumers. Joachim Kreysing, Managing Director of the industrial park operator Infraserv Höchst, describes the gas levy as "a very big burden" in view of the already rising energy costs. "The surcharge is currently very difficult for energy-intensive industry to bear." 

 

It could lead to further production stops because production costs in Germany are no longer competitive.

 

Industry is by no means the largest consumer of natural gas in Hesse. Their most recent requirement of 10,000 gigawatt hours is less than a third of what households, shops and offices use for heating.

And so far, at least, it has coped well with the costs. The Clariant Group, for example, which has a large site in the Höchst Industrial Park, was able to double its consolidated profit in the first half of the year. The chemical group Evonik, which operates several large plants in Hesse, exceeded its previous profit expectations in the second quarter - i.e. after the start of the sanctions on Russia. And Samson boss Widl speaks of a "remarkably good first half of the year" that has exceeded expectations.

In addition, the manufacturing industry has continuously reduced its gas requirements in recent decades, it is now a third lower than in 1990. The pharmaceutical manufacturer Boehringer Ingelheim, for example, is currently building a combined heat and power plant in Ingelheim that is operated with waste wood and is primarily intended to replace natural gas. Construction began a year ago and is scheduled to be completed in 2023.

Norma commissioned a new incinerator in December last year, which uses significantly less gas than the previous plant, as part of the reduction in greenhouse gases. "Compared to last winter, we expect significantly lower gas consumption in Maintal production," says a company spokeswoman.

Heating oil, diesel and coal replace natural gas

The move away from gas has now accelerated considerably. Since the threat of a Russian gas embargo has loomed large consumers have switched to other fuels. Evonik in Hanau's Wolfgang Industrial Park generates 80 percent of its steam in its own coal-fired power plant. Among other things, the group produces lipids there, which are required as a type of packaging for Biontech's new corona vaccine. The Darmstadt site is powered by long-distance steam from municipal waste thermal power station, the plants in Weiterstadt and Steinau are converted to heating oil.

The Hanau metal and components group Heraeus is also in the process of switching to heating oil. "The planning and implementation of specific measures to replace natural gas with heating oil at our main plant in Hanau are making progress," reports energy manager Dietmar Bork. In addition, it will be examined what savings are possible in the heating of buildings.

 

What all this saves in the end is currently not foreseeable.

 

Samson has meanwhile also stored heating oil. In production, explains Widl, special heaters are to be used that run on diesel. The company has also purchased fan heaters for the offices. 

 

In extreme cases, the combined heat and power plant must be shut down because it cannot be operated with alternative fuels.

 

And in the medium term, Widl wants to completely get off the gas anyway. He hopes that the new factory in Offenbach will be able to work almost completely self-sufficient in terms of energy. Instead of fossil fuels, which have to be imported, he wants to use solar energy and geothermal energy there. But it will still take a long time until the planning, approval and erection is complete. 

 

The move is targeted for 2026 – too late to avoid the gas surcharge."

 

Let us hope that everything is fine with the health of Mr. Scholz. The pressure on him seems to be too big to preserve a healthy way of life.

Zelenskio cirkas, sprogdinantis daiktus, nėra vertas bėdų, kuriuos jis sukelia JAV ir Europoje

„Gamtinių dujų kainos Europoje antradienį baigėsi rekordiškai, kai karšti vasaros orai padidino degalų paklausą, o Rusija stabdė tiekimą.

 

    Europa nuo birželio mėnesio kovojo su drastiškai mažesniu dujų importu iš Rusijos, iki šiol jos didžiausios tiekėjos. Maskva 80% sumažino srautus per dujotiekį „Nord Stream“, kad nubaustų Vokietiją ir kitas šalis už paramą Ukrainai. Bijodama, kad prezidentas Vladimiras Putinas įsakys visiškai nutraukti dujų tiekimą, Europos Sąjunga ėmėsi plano dabar taupyti dujas, kad jas degintų per žiemą.

 

    JAV, kur eksportas į Europą privertė išlaikyti mažą vidaus tiekimą, gamtinių dujų ateities sandoriai antradienį pakilo iki 9,329 dolerių už milijoną Didžiosios Britanijos šiluminių vienetų, o tai yra aukščiausia kaina per 14 metų ir 150 % daugiau, nei prieš metus.

 

    Karščio banga kelia pavojų Europos pastangoms sandėliuoti pakankamai dujų, kad būtų išvengta normavimo vėsesniais mėnesiais. Aukšta temperatūra padidino dujų paklausą Europoje ir Šiaurės Azijoje, o dviejų regionų komunalinės paslaugos verčia konkuruoti dėl riboto tanklaivių, gabenančių peršaldytas suskystintas gamtines dujas, skaičiaus ir padidino kainas.

 

    Karštas, sausas ir ramus oras atneša ir kitų komplikacijų. "Vokietijoje nėra pakankamai vėjo ar anglies baržų. Ir iš tikrųjų Prancūzijoje atominės elektrinės negali gauti pakankamai vandens aušinimui", - sakė "Rystad Energy" analitikas Xi Nan. „Ir, žinoma, apskritai hidroenergijos lygis yra gana žemas, ypač Norvegijoje.

 

    Pripažindama artėjančią krizę, Vokietija planuoja atidėti paskutinių trijų savo atominių elektrinių uždarymą ir sustabdyti du dešimtmečius trukusią branduolinės energijos atsisakymo politiką, rašo „The Wall Street Journal“, remdamasis vyriausybės pareigūnais.

 

    Dujų ateities sandoriai prekybos centre Nyderlanduose, šiaurės vakarų Europoje, antradienį pakilo 3,2% iki 233,56 euro už megavatvalandę, maždaug 237 dolerių. Tai aukščiausia visų laikų kaina eurais ir viršijo rekordą, pasiektą kovo 7 d., netrukus po sankcijų Rusijai fontano.

 

    Energijos rinkos, kurias šiuo metu diktuoja elektrą gaminančių dujų kaina, taip pat auga. Vokietijoje bazinės energijos, kuri bus išsiųsta 2023 m. pradžioje, kainos antradienį pakilo beveik 9% iki 583 eurų už megavatvalandę.

 

    Didelės kainos kenkia daug energijos vartojančioms pramonės šakoms. Antradienį cinko gamintoja „Nyrstar NV“ pranešė, kad nuo rugsėjo 1 d. pradės strigti Nyderlandų lydymo darbai.

 

    Elektros sąnaudos yra net 10 kartų didesnės nei istoriniai lygiai, o „Nyrstar“ stengėsi jas perkelti dėl aukštesnių cinko kainų, sakė asmuo, susipažinęs su sprendimu.

 

    Pramonės jėgainėje Vokietijoje ekonomikos augimo lūkesčiai šį mėnesį iki šiol smuko, antradienį parodė tyrimų instituto „Zew“ atlikta apklausa. Konsultacijų bendrovės „Capital Economics“ vyriausiasis Europos ekonomistas Andrew Kenninghamas teigė, kad duomenys rodo, kad nuosmukis šiais metais neišvengiamas iš dalies dėl didelių energijos kainų poveikio namų ūkiams ir pramonei.

 

    JAV nebuvo apsaugotos nuo skausmo, atsižvelgiant į tai, kaip kylančios vidaus kainos padidino šildymo ir elektros sąnaudas. Tačiau JAV gamtinių dujų kainos kilo mažiau, nei Europoje. Be to, JAV kompanijos gauna naudos, brangiai parduodant gamtines dujas už Atlanto.

 

    Dujų kainų šuolis taip pat prieštarauja naftos kainoms, kurios sumažėjo trečdaliu nuo aukštų posankcijinių sandorių, smarkiai sumažindamos benzino kainas ir palengvindamos amerikiečių vairuotojų dalią.

 

    Vidurio ir Rytų Europos ekonomika, kuri priklauso nuo Rusijos naftos ir dujų, yra labiausiai paveikta regione. „Moody's Investors Service“ šį mėnesį Čekijos vyriausybės kredito reitingo perspektyvą pakeitė į neigiamą iš stabilios. Ji paminėjo užsitęsusių dujų tiekimo iš Rusijos sutrikimų, galinčių sukelti normavimą ir gilią recesiją, riziką.

 

    Remiantis „Gas Infrastructure Europe“ duomenimis, ES saugyklos užpildytos beveik 75 proc., o tai leidžia blokui pasiekti užsibrėžtą 80 proc. lygį iki lapkričio 1 d. Tačiau dėl karščio tai dar labiau apsunkinta. 

 

Viena iš priežasčių: upių lygis nukrito iki tokio žemo lygio, kad Vokietijos anglies jėgainės sunkiai importuoja kurą. Savo ruožtu tai reiškia, kad norint gaminti elektrą, reikia sudeginti daugiau dujų.

 

    Analitikai ir energetikos vadovai teigia, kad Rusijos sumažintas dujų tiekimas Europai sukelia tiek daug ekonominės žalos, kad parama Ukrainai mažėja. [1]

 

Jau laikas. Zelenskio cirkas, sprogdinantis daiktus, nėra vertas bėdų, kuriuos jis sukelia JAV ir Europoje.

 1.   European Gas Prices Hit High
Wallace, Joe. 
Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 17 Aug 2022: B.1.

Zelenski’s circus blowing up things is not worth the disruption that it is causing in US and Europe.

"Natural-gas prices in Europe closed at a record Tuesday with hot summer weather boosting fuel demand and Russia throttling back supplies.

Europe has contended since June with drastically lower imports of gas from Russia, until recently by far its biggest supplier. Moscow cut flows through the Nord Stream pipeline by 80% to punish Germany and others for supporting Ukraine. Fearing President Vladimir Putin will order a full cutoff, the European Union has embarked on a plan to conserve gas now to burn it over the winter.

In the U.S., where exports to Europe have helped keep domestic supplies lean, natural-gas futures climbed Tuesday to $9.329 per million British thermal units, the highest price in 14 years and 150% more than a year ago.

A heat wave is jeopardizing efforts in Europe to put enough gas into storage to avoid rationing in the cooler months. High temperatures have fueled gas demand in Europe and north Asia, pushing utilities in the two regions to compete for a limited number of tankers carrying supercooled liquefied natural gas and driving prices higher.

Hot, dry and still weather brings other complications. "You don't have enough wind, or enough coal barges in Germany. And actually in France, nuclear plants cannot get enough water for cooling," said Xi Nan, an analyst at Rystad Energy. "And of course, hydropower levels in general are quite low, especially in Norway."

In an acknowledgment of the impending crisis, Germany plans to postpone the closure of its final three nuclear power plants -- pausing a two-decade policy of ditching nuclear power, The Wall Street Journal reported, citing government officials.

Futures for gas at a trading hub in the Netherlands, the benchmark in northwest Europe, rose 3.2% Tuesday to 233.56 euros a megawatt-hour, about $237. That is the highest price ever in euros, surpassing the record set March 7, shortly after barrage of sanctions on Russia.

Power markets, currently dictated by the price of electricity-generating gas, are surging, too. In Germany, prices for baseload power that will be dispatched in early 2023 rose almost 9% Tuesday to 583 euros a megawatt-hour.

High prices are taking a toll on energy-intensive industries. On Tuesday, zinc producer Nyrstar NV said it would idle its Dutch smelting operations starting Sept. 1.

Electricity costs are as much as10 times as high as historical levels, and Nyrstar has struggled to pass them on through higher zinc prices, a person familiar with the decision said.

In industrial powerhouse Germany, expectations for economic growth slid so far this month, a survey by the Zew research institute showed Tuesday. Andrew Kenningham, chief Europe economist at consulting firm Capital Economics, said the data suggest a recession is inevitable this year in part because of the effects of high energy prices on households and industry.

The U.S. hasn't been immune from the pain, given how surging domestic prices have raised heating and electricity costs. But the increase in U.S. natural-gas prices has been less intense than in Europe. Plus, the U.S. economy benefits by selling natural gas across the Atlantic.

The surge in gas prices also comes in contrast to oil prices, which are down by a third from postsactions highs, pulling prices at gasoline pumps sharply lower and giving relief to American drivers.

Economies in Central and Eastern Europe that depend on Russian oil and gas are the most exposed in the region. Moody's Investors Service this month changed the outlook for the Czech government's credit rating to negative from stable. It cited the risk of prolonged gas-supply disruptions from Russia that could lead to rationing and a deep recession.

Storage sites in the EU are almost 75% full, according to Gas Infrastructure Europe, putting the bloc on track to meet its target level of 80% by Nov. 1. The heat is making that more difficult, however. One reason: River levels have fallen to such low levels that German coal-power plants are struggling to import fuel. In turn, that means burning more gas to generate electricity.

Russia's cutting gas supplies to Europe, analysts and energy executives say, is causing so much economic harm that support for Ukraine wanes.” [1]

It is about time. Zelenski’s circus blowing up things is not worth the disruption that it is causing in US and Europe.

1.   European Gas Prices Hit High
Wallace, Joe. 
Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 17 Aug 2022: B.1.