BBH’s annual conference on 29/03/2023 was all about strengthening infrastructures in Germany. Representatives from the fields of politics, business and the media gathered at Französische Friedrichstadtkirche in Berlin to join the BBH group in discussing ways to strengthen infrastructures to ensure the successful implementation of the energy and climate transition and enable the economy to operate within good framework conditions.
The host and BBH partner Prof. Dr. Ines Zenke opened the conference with a clear message: “We are facing the greatest challenge of the post-war era. We need to achieve greenhouse gas neutrality for Germany by 2045 – afterwards for the continent, indeed the whole world.” Strong infrastructures are essential for this, and swift action is needed in this area. “Strong electricity grids, good roads, methane gas grids that can be converted to hydrogen, fibre optics and the like – all of these are indispensable for our competitiveness and a successful climate transition.
“Speeding up processes” thus also constitutes one of the defining themes of the annual conference when it comes to planning, permitting and implementing all upcoming climate projects. In response to that, the US introduced the Inflation Reduction Act (IRA) which was not appreciated by everyone. However, Prof. Zenke also made clear statements on this issue, with which she passed on to our first keynote speaker Stephen C. Anderson, Minister-Counsellor of the US Embassy: “The IRA addresses what we also want to see in Germany: climate protection and climate neutrality, a strong and modern infrastructure, a transformation that includes the economy. With captivating simplicity and an openness to technology.”
Attaché Anderson continued in the same vein: “We are all facing the greatest transformation since industrialisation. The challenge of switching to clean technologies while guaranteeing a secure and affordable energy supply is tremendous.“ At the same time, the war against Ukraine clearly shows us how important it is to avoid commodity and technology dependencies. Through the IRA, the US aims to innovate and grow without tearing down existing bridges: “The alliance between the US and Europe, indeed between the US and Germany, is stronger than ever – and that is really good news in these challenging times,” Anderson concluded.
Afterwards, premier Anke Rehlinger, who is known for her clever policies for attracting and retaining companies, addressed the audience. Joining us remotely from Saarland, the SPD politician described how the transformation towards climate neutrality not only entails a lot of work, but also provides many opportunities: “We have now reached a point where it has never been so obvious: investments in renewables benefit climate protection AND preserve jobs. For regions that recognise this at an early stage, this will be a locational advantage”. In Saarland, a federal state characterised by the steel industry, a transformation fund has been set up specifically for this purpose. Rehlinger: “We need to invest right now in order to attract innovative companies. Not doing anything would cost us much more money in the long run, for example through rising unemployment.”
The participants were in no doubt that the climate targets for 2045 set by the traffic light coalition are ambitious. But something is missing at every turn: innovations, raw materials, and labour to name a few – only bureaucracy and financing worries seem to be never-ending. Mark Helfrich, Member of the Bundestag and spokesperson on energy policy for the CDU/CSU parliamentary group, called for “streamlining in all areas to save costs.” Bernd Westphal, Member of the German Bundestag and economic and energy policy spokesperson of the SPD parliamentary group, added the following regarding the municipalities: “Mayors and district councillors have to view this time as an opportunity.” For example, undeveloped areas should be made available without bureaucracy for building wind turbines, said the SPD politician, who considered the participation and involvement of the people to be of central importance.
Olaf in der Beek, Member of the Bundestag and climate policy spokesperson of the FDP parliamentary group, considered streamlining processes as the way forward: “We need more digitalisation in the administrative sector. The municipalities have to be able to work locally with greater ease – and we are setting the framework for this in Berlin.” Thomas Lutze, Member of the Bundestag for Die Linke and chair of the transport committee, on the other hand, was happy to act as a spoilsport: “The ultimate solution is not simplification. The direct effects of various climate protection measures must always be taken into account.”
BBH partner Prof. Christian Held shifted the discussion to the topic of “ownership unbundling”, i.e. the separation of grid operation from the other energy supply segments. Held said: “If the traffic light coalition wants to meet its ambitious climate policy objectives, it must firmly oppose the EU’s plans. There should be no ownership unbundling, as we cannot achieve the transformation without gas grid operators. The existing established gas infrastructures are the backbone for entering the hydrogen age.” In this respect, Dr. Julia Verlinden, Member of the Bundestag and deputy chair of the Bündnis 90/Die Grünen parliamentary group, was sure that “the Federal Government will find a good solution to enter into the trilogue negotiations with the EU.” This was not sufficient for Mark Helfrich: “We need an integrated planning approach – which existing infrastructures can we use, which do we have to dismantle. That would leverage synergies. And this is the only way to massively reduce costs.” Bernd Westphal referred to the position of the European Parliament and rapporteur Jens Geier: “The position of the European Parliament is clear. No ownership unbundling. I support that.”
Stefan Schnorr, State Secretary at the Federal Ministry for Digital Affairs and Transport (BMDV), believes that political solutions strengthen Germany’s infrastructures. The BMDV intends to accelerate digital processes: “I am convinced that digitalisation will help us with all climate projects. What is important though is that every department has to be involved. The BMDV is confident that the past few years’ backlog of digitalisation can be cleared – which will also help the infrastructures.” And yet it is the entrepreneurs who foster innovation and have to face contemporary demands. In this respect, Dr. Jörg Kukies, State Secretary at the Federal Chancellery, said: “A decisive aspect on the path to climate neutrality is our inventive spirit – this spirit has always made the German economy strong.”
Hans-Hinrich Schriever, managing director at EAM GmbH, remarked that the inventive spirit alone is not enough to achieve the transformation, stating that “we are unable to hire the workforce we need for the energy transition because it does not exist.” Strong electricity grids are a necessity for 100% renewables and electromobility. But the current rate on equity and regulation do not reflect this understanding. And Ingbert Liebing, CEO of the German Association of Local Utilities (VKU), remarked that many climate protection projects are still slowed down by excessive bureaucracy: “We need a change of culture in permitting authorities and administrative departments.” BBH partner and lawyer Dr. Roman Ringwald pointed out that there is limited time available: “The climate targets are an incredibly ambitious programme. It is important that we keep at it. We need a multitude of processes in all areas of infrastructure.” And procurement law as well as State aid law have to be modernised.
BBH’s annual conference in 2023, characterised by its lively discussions, concluded with an important message to the approx. 200 attendees: We all need to embrace the momentum that the climate is gaining from broad public interest – we need to take action and remain open to a wide range of technologies. Time will tell which technology will actually bring about the transformation.
The BBH group is a leading provider of advisory services for energy and infrastructure companies and their customers. Energy and supply companies, particularly public utilities, municipalities and local authorities, industrial companies and international groups are among its core clients. The BBH group advises these and many other companies and organisations in all legal matters and also assists them with business and strategic advice.
Prof. Dr. Ines Zenke
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