There is a real risk of seeing whole sections of our industry leave Belgium for good, warn representatives of the sector. “That our politicians are not aware of!”
Fear of a gas shortage this winter is rising in industries that consume a lot of it. This would be the consequence of the strategy of Russian President Vladimir Putin, who uses energy as a weapon of war. Belgium is updating its emergency plan and organizing a possible load shedding, by determining the companies likely to be on the front line of cuts.
Fear of a gas shortage this winter is rising in industries that consume a lot of it. This would be the consequence of the strategy of Russian President Vladimir Putin, who uses energy as a weapon of war. Belgium is updating its emergency plan and organizing a possible load shedding, by determining the companies likely to be on the front line of cuts. “Belgium is lucky to have a fairly diversified supply network, tempers Peter Claes, president of Ifiec Europe, the European Federation of Industrial Energy Consumers. Only 4 or 5% of our needs come from Russia. , which is very little compared to Germany. Norway is our main supplier, via the Netherlands. We have the potential for liquefied gas (LNG) via Zeebrugge, or even Dunkirk. We have an interconnection with England . In short, a lot has to go wrong before we experience a supply problem. But it is important to prepare for it because the consequences could be disastrous.” Hence the importance of updating the existing plan, a work in progress, taking into account the specificities specific to certain sectors. But it must go further. The first concern of our companies is the current level of prices. “It has become prohibitive for certain industrial activities, underlines Peter Claes. Gradually, this affects a growing number of companies because, like households, some of them are subject to the indexation of their contract. These are enormous increases. Barely a year ago, the price of gas was 25 euros per MWh, today it is 120 or 130 euros per MWh, five times the price, knowing that the prices in the United States, Latin America and Australia or in most African countries have not moved, we are in a deteriorating competitive position.” Some companies try to pass on these increases in their selling price. But others depend on market prices. “Let’s not forget that this is in addition to increases in the cost of raw materials or the indexation of wages, adds the president of Ifiec Europe. It’s a time bomb. Little by little, it will weigh on our industrial fabric. Certain activities have already been reduced in Europe, such as the production of ammonia, the steel industry, zinc… The domino effect has begun. And it is not over. It is likely that Russia will completely stop its gas exports, this will further increase prices. And other countries will call for European solidarity… This risks causing structural damage to our industrial fabric.” “This high gas price also has a direct effect on electricity, the market price of which is set in part by gas-fired power stations, explains Luc Sterckx, president of Febeliec, the Belgian federation of electricity-consuming companies. This is already weighing on a company very dependent on electricity like Nyrstar (zinc and lead, Editor’s note), which has stopped a production line in France. Febeliec also warns of Belgium’s potential disadvantage. “We had a study carried out by Lloyds at the beginning of the year, explains Luc Sterckx. It has shown that the taxes and fees paid on the price of electricity are much higher than those of neighboring countries. We insist with the government for it to act and at least bring the price down to the level of our close competitors. The government must choose the nest in which it lays its eggs and support its industries.” This is all the more essential since this “energy-intensive” industry is proportionally more important here than in other countries like Germany, adds the president of Febeliec. “We can measure the impact on investments or employment, emphasizes Luc Sterckx. A study carried out by the KULeuven at our request showed that a 10% increase in the price of electricity would lead to a drop of half a billion in investment and the potential loss of some 12,000 jobs per year. That’s not talk!” Does the political world take the measure of what is at stake? “We could do better. I understand that policies are more sensitive to the general public, to households, but we forget that economic well-being also depends on the future of the industry.” “Let it be clear: we are not opposed to helping the most vulnerable households, insists Peter Claes. Faced with such a rise in prices, it is obvious that a check for 100 euros is not enough to the less well-off. We are not asking for limited aid to industry. But we are asking for an awareness of the potential structural impact. If the current situation continues, we risk losing a series of industrial activities without much hope that they will come back one day. If we start to lose the ammonia, zinc or non-ferrous activities, this risks triggering an irremediable process. This, I do not think our politicians realize. .” On the contrary. “One of the actions of the European authorities consists in further accelerating the obligations in terms of CO2 reduction for industry and raising the bar even further for renewable energies, underlines the director of Ifiec. You shouldn’t do it, but it’s not really going to help our industry. It’s becoming critical.” The solution would involve requirements adjusted to the emergency, moderate taxation in Belgium or specific support for certain activities that risk disappearing. And “simple” decisions. “In Belgium, we do not apply a reduction in transmission tariffs for stable consumption profiles. Germany has been doing this for 10 years, France and the Netherlands too. Why is this not done at us? That’s a major disadvantage. Nyrstar has three sites in those three countries: in Belgium, that’s a disadvantage of 4 or 5 million. Yet it’s an easy step to take to at least stay competitive with neighboring countries. .” As for the emergency plan to secure supply, it must be used judiciously: “We must monitor sector by sector, with as individual an approach as possible. Some industries will stop production if the price of gas is at a certain level. Each type of production has its threshold. Is this considered in the emergency plan? Are there plans to take into account industries that cannot take the slightest risk? Are we going to put in place a platform where companies can offer gas and with what remuneration? “The industry is ready to find solutions, insists Luc Sterckx. We are not saying that we want to be a priority when the rest of the population is suffering, not at all. But we must ensure the survival of whole sections very sensitive to energy price explosions.” The future of the sector depends on it, at a time when all parties are pleading in favor of the reindustrialisation of Europe.