Setting the course to the future in Lower Saxony

We should not be worrying, as we are coming from a position of strength. But we are looking at the situation with a good deal of skepticism. Energy-intensive key industries in particular, such as the steel and chemical sectors, have recently come under pressure.

Looking at the foundation – geological prerequisites, entrepreneurial self-confidence, the ability to change – I would readily award a B+.

I see the chemical industry, for example, making a similar effort. Or the automotive industry, which is experimenting with hydrogen technology and autonomous driving or working on innovative battery cell production. Many companies are well on their way. However, they need competitive political framework conditions. And when I look at what we have in place, I would tend to award a grade of four.

No. Companies like Salzgitter AG in particular need long-term reliability in view of their tremendously complex investment decisions. It takes 30 or 40 years for huge plants such as direct reduction plants and electric arc furnaces to be written off. Without reliable guard rails, you risk economic hara-kiri – which is not an option for a shareholder-driven company. What’s more, we urgently need the loud and clear voice of national politics to be heard at the EU as well.

Tackling our energy prices – if we do not come to terms with this issue, the transformation in these sectors will not succeed. Then other sectors will push forward. But I doubt whether they can achieve a similarly high level of value creation with comparable jobs.

Lower Saxony is at least the only federal state with a uniform position on industrial electricity prices. Unfortunately, despite many announcements, such a position still does not exist today and it is to be feared that only a few will benefit from it. It is obvious that federal policy is out of its depth here. The same applies to the hydrogen supply. There are just as many unanswered questions in this respect. When will the infrastructure be ready? Who will produce the hydrogen and when? How can we achieve all this at competitive prices?

There are enough investors, such as insurance companies, who are not interested in the highest possible short-term returns, but in stable long-term returns instead. In addition, the state's billion-euro infrastructure package can act as a major lever for initiating a comprehensive green transformation. Naturally, low-CO₂ products are often more expensive than conventionally produced ones. But if green steel is prioritized in tenders, for example, economies of scale could quickly take effect. And a sustainable future viable market is developing that is not dependent on subsidies.

Fair competition: Overcapacities from China are pushing into the markets, with some products being sold at prices that are on par with production costs in Europe. This does not work. I am also increasingly concerned that major partners such as the USA are abandoning rules-based competition – and are relying on the law of the jungle instead of WTO rules. Europe must draw closer together and leverage its market power. 

For example, through emissions trading. With a CO₂ price that can also have a prohibitive effect. If we want to be climate-neutral at some point, CO₂ must be so expensive that avoiding it always pays off. Until then, we need to build a bridge to ensure that the transformation phase up to 2050 is clean and safe – meaning that first movers are not penalized, but benefit from market advantages.

That's right – the technology expertise and added value in this area have long since migrated out of Germany. Which is why this should not happen again with wind energy – we are still the number one location in Lower Saxony – or with hydrogen.

By not only installing the wind turbines here, but also by developing, building and recycling them in Lower Saxony. The entire life cycle of this energy generation must take place here instead of us importing plants from third countries, which we may even be subsidizing. That is why I regard it as so important that we build and maintain closed value chains in Europe, Germany and Lower Saxony. This is the only way to increase productivity and added value. We are still running too close to each other in this respect.

Together with the state government of Lower Saxony, we are in the process of positioning ourselves better in Brussels, namely Lower Saxony as a location, to benefit from the next funding period in 2027. The aim being that more funds flow from Brussels to Lower Saxony. But we also need make considerable improvements in distributing these funds.

We now have over 2,000 funding guidelines in Lower Saxony, a jungle that companies have to fight their way through. We need fewer, but broader and more extensive funding guidelines. We should not be distributing the money with a watering can but must think in terms of topical clusters and invest in promising ecosystems with which Lower Saxony is associated worldwide. Whether this is mobility, hydrogen, the defense industry, health or agriculture – one thing is for certain: there is no need to worry.

Thank you for talking to us.