#BBHSymposium19: Economy and energy in the 21st century

This year, 2,156 companies have filed an application with the Federal Office for Economic Affairs and Export Control (Bundesamt für Wirtschaft und Ausfuhrkontrolle – BAFA) for exemption from the surcharge payable under the Renewable Energy Sources Act (Erneuerbare-Energien-Gesetz – EEG) (hereinafter: EEG surcharge) or a reduction thereof. The next step is for the Federal Network Agency to decide by December how many of these applications can be approved under the special equalisation scheme. On the occasion of the BBH symposium “Economy and energy in the 21st century”, which was held on 10 September 2019 in Berlin, no less than two former presidents of BAFA, Dr. Wolfgang Danner and Andreas Obersteller, provided the participants with in-depth insights into the practice of the Federal Network Agency.

Dr. Wolfgang Danner   Andreas Obersteller
Dr. Wolfgang Danner © Marco Urban                                                   Andreas Obersteller © Marco Urban

While former BAFA president Andreas Obersteller considered BAFA as a “partner to companies“ and not as “acting against companies”, he also admitted that the practical implementation of the funding regulations for those they are aimed at does not usually have the highest priority when developing the funding scheme. One may well ask whether the individual funding programmes are indeed configured correctly. BBH partner Dr. Markus Kachel finds it absurd that, in principle, too little money is drawn from the various sources of funding. It would be necessary to bring together good ideas and financial resources and to approach policymakers in this respect. Dr. Wolfgang Danner concluded that instead of a maze of subsidies, efficient subsidies are required.

However, Dr. Danner then went on to raise the following question: “Can’t companies take action on their own without always waiting for policymakers?” Manfred Greis, former chief representative of Viessmann, took up this question stating that, much to his regret, poor predictability, uncertainty and a fluctuating CHP support constitute very unfavourable conditions for an economic commitment. Dr. Markus Kachel also criticised the rigid thresholds of the special equalisation scheme. According to him, a yes or no system for privileges is difficult and leads to contradictory objectives: On the one hand, energy-intensive companies are to commit themselves to energy efficiency; on the other hand, doing so may lead to those companies no longer qualifying for benefits under the special equalisation scheme. He called for more flexibility in this respect in order to resolve this paradox.

Rita Schwarzelühr-Sutter
Rita Schwarzelühr-Sutter © Marco Urban 

Parliamentary State Secretary of the Federal Ministry for the Environment (BMU) Rita Schwarzelühr-Sutter placed the focus on climate protection. In her opinion, environmental and climate protection much depend on courageous companies and she was convinced that there are many “hidden champions” in this area also among small and medium-sized companies. The solution that the Climate Cabinet must achieve on 20 September would have to be socially responsible, feasible and designed to allow for a swift implementation. At the same time, it would have to provide planning security for companies. While the state would not have to intervene in the capital market, it would have to provide for the necessary framework conditions. She added that through smart action and a participatory strategy, for example, new opportunities had been opened up for the creation of added value in the regions undergoing structural change. The aim was to also create a successful industrial policy for the 21st century.

Manfred Greis
Manfred Greis © Marco Urban 

Manfred Greis agreed with her in this regard: “In order to become climate neutral, we need the expertise of the industry.” According to him, scrapping oil heating systems would not be enough, one would have to scrap entire buildings. With this, Greis alluded to a modernisation of buildings focused on improving energy efficiency, an area which has seen little progress. “Instead of prohibitions, we need requirements which offer real alternatives to people,” he said.

Dr. Joachim Lang, Director General of the Federation of German Industries (Bundesverband der Deutschen Industrie e.V. – BDI), confirmed his support for hydrogen technology in production processes of the industry, but pointed out that this was not a short-term alternative: The investment cycles of the industry range from 10 to 15 years. He sees, in general, a cost problem in Germany and stated that the business models we design in Germany are only attractive to foreign countries if we manage to reduce costs. So the question would be how we can, for example, make synthetic fuels economically profitable within 10 years.

Dr. Joachim Lang   Philipp Schlüter
Dr. Joachim Lang © Marco Urban                                                  Phillip Schlüter © Marco Urban

Philipp Schlüter, CEO of TRIMET SE, explained how the industry is already contributing to relieving the burden on the energy system. By making their production processes more flexible and decoupling supply and demand, TRIMET’s aluminium plants serve as large power storage facilities.

Member of the German Bundestag Johann Saathoff also emphasised the vital role the industry plays in our energy system stating that this June, an energy-intensive company had saved the stability of the electricity grid by balancing out fluctuations. However, in his opinion, this also shows that while we are already talking about industry 4.0, in terms of the grids we are still at a level of 0.4. Johannes Lackmann, managing director of WestfalenWIND GmbH, is also convinced that the fixed grid charges structure hinders an efficient flow of energy.

Another discussion moderated by BBH partner Ulf Jacobshagen focused on the further expansion of renewable energy. Johann Saathoff spoke out against minimum distances for wind turbines. In his opinion, binding expansion corridors for renewable energy as well as further incentives in the South of Germany would be necessary instead, in addition to a viable landlord-to-tenant electricity concept. Member of the German Bundestag Mark Helfrich, on the other hand, thinks that lowering electricity prices and relieving the burden on the electricity sector should have priority. He also pointed out that there are political limits in terms of the expansion of renewable energy and warned against ignoring the acceptance problems of citizens with regard to the expansion of wind power.

Johann Saathoff   Mark Helfrich
Johann Saathoff © Marco Urban                                                  Mark Helfrich © Marco Urban

This concluded the symposium at the premises of BBH Berlin, which was also a celebration of Dr. Wolfgang Danner’s 80th birthday. Dr. Wolfgang Danner was partner of counsel at BBH until 2013 and is still a co-editor, together with Prof. Dr. Christian Theobald, of the loose-leaf standard reference “Energierecht” (energy law) published by C.H.Beck. The symposium clearly showed that the subject of energy, to which he has been dedicated throughout his life, is still of utmost importance to him.


Prof. Dr. Ines Zenke und Dr. Wolfgang Danner © Marco Urban   

Becker Büttner Held ist ein führender Anbieter von Beratungsdienstleistungen für Energie- und Infrastrukturunternehmen und deren Kunden. Den Kern der Mandantschaft bilden zahlreiche Energie- und Versorgungsunternehmen, vor allem Stadtwerke, Kommunen und Gebietskörperschaften, Industrieunternehmen sowie internationale Konzerne. Diese und viele Unternehmen und Institutionen aus anderen Bereichen unterstützt BBH sowohl in allen Rechts- und Steuerfragen als auch betriebswirtschaftlich und strategisch.

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Contact:

Prof. Dr. Ines Zenke
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Tel +49 (0)30 611 28 40-179
ines.zenke(at)bbh-online.de

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