German renewables subsidies mean SMEs face energy cost 'avalanche'

05 September 2013 12:46  [Source: ICIS news]

LONDON (ICIS)--Government subsidies for the promotion of renewable energy in homes and businesses have resulted in an “avalanche” of increased energy costs for small- and medium-sized chemical enterprises (SMEs) working within the chemical industry in Germany, trade body VCI said on Thursday.

According to the chairman of VCI’s committee of independent entrepreneurs, increased energy costs associated with Germany’s renewable energy sources act (EEG) and the transition to renewable energy take-up (Energiewende) is having a disproportionate impact on smaller companies in energy-intensive industries such as chemicals production.

“The further rising EEG-allocation (EEG-Umlage) has the effect of an extra wealth tax on energy-consuming companies. This weakens our innovative potential and poses a risk to jobs,” said Reinhold von Eben-Worlee, chairman of the committee and managing director of producer Worlee-Chemie.

“Until the EEG is reformed fundamentally, we are calling on the new federal government to take immediate steps and to suspend the support for new installations,” he added.

von Eben-Worlee presented in Berlin a memorandum signed by 200 chemical industry SMEs, calling on the German government to halt energy price increases associated with the Energiewende and expanding renewable energy usage.

A mid-sized company with 250 employees and sales of €115m ($151m) in 2012, Worlee-Chemie estimates that the combined €460,000 in annual EEG costs and €160,000 in further energy-related charges account for over half of its total energy costs. The company is not exempt from EEG allocation, like some smaller companies.

Another German chemicals SME, basi Schoberl, estimates its electricity costs for their German operations are around 300% higher than at its French site.

If there are no changes in how the Energiewende is organised, the energy transition works against energy-intensive companies like basi Schoberl who depend on base load supplies at affordable prices,” said basi Schoberl director Ingo Nawrath.

($1 = €0.76)

By: Tom Brown
+44 208 652 3214

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