Dr.-Ing. Hans-Bernd Pillkahn

EU Climate Policy: A Disaster for Energy-Intensive Production

This is the edited transcript of the presentation of Hans-Bernd Pillkahn to Panel V, “Scientific Ecology and Assessing the Climate Challenge; Eradicating Poverty and Hunger in the World is the Priority,” of the Schiller Institute’s July 8–9 conference, “On the Verge of a New World War—European Nations Must Cooperate with the Global South!” Dr.-Ing. Pillkahn is an engineer and CEO of PROASSORT, GmbH in Werdohl Germany. Subheads have been added, and the number of his graphics has been reduced.

Dear ladies and gentlemen,

Thank you very much for allowing me the opportunity to talk to you today, despite the warm weather. The good news is, in Germany, we are working on a strategy to defeat summer. Just wait one or two years. I’m happy to talk to you a bit about the EU climate policy from my personal opinion. Perhaps you [will] agree with me afterward. The EU climate policy is a disaster for energy-intensive industry in its member nations.

Let’s have a look into the EU, and then let’s have a look into the climate, and then we’ll have a look at both together in industry.

What is the EU? The European Union (EU) countries cover 4% of the global land area. The EU has a population of about 6% of the global population. The gross domestic product (GDP) value that we create is about 16% of the global value that is currently being created. Therefore, we need a lot of energy. We need 13% of all the wattage that is produced in the world. We need about 10% of the gas consumption of the world. We need about 12% of the oil consumption of the world. We have a self-supply rate in the EU for gas of 11%. In other words, we produce 11% of the gas that we need. Looking at oil, we have a self-supply of 4%; 4% of the oil that is consumed in the EU, we lift [from the Earth—ed.] ourselves. That is, of course, a strong position for political sanctions. Everybody is clear about that.

Look a little bit into the atmosphere. The air in the Earth’s atmosphere, weighs a total of 5 multiplied by 10¹⁵ tons. That’s ten with 15 nils [zeros—ed.] tons of air in the atmosphere. I do not know the English expression, but that is a very, very big number. Most of you have to deal with three nils in your life; the very rich of you have to do with four, perhaps. But [something] that is 15 nils, is going out of our dimension. Nobody in the world can imagine what that means. Nobody.

Okay, let’s go on. We now focus on the anthropogenic global warming theory.

As you see in Figure 1, I have written the word “theory” in gray, because all theory is gray. You know that. And the [intensity of the] electromagnetic radiation, that is, that which costs [melts your] one ball of ice cream—is about 1.3 [kilowatts per square meter] when the Sun shines directly down on the [top of the] Earth[‘s atmosphere]. But only about 30%, let us say, of that really arrives at the Earth[’s surface]. We have problems managing [accounting for] even that amount of energy. Scientists today are quarrelling about what some think is an imbalance, of 0.6 watts per square meter. When you compare that with [the] other figures, you see you have some doubts of whether that 0.6 watts per square meter really can destroy the world. Perhaps you have some trouble with [believing] that.

We always talk about correlation. In Germany, in the area I live in, North Rhine-Westphalia, the number of storks—you know, those big birds—correlates with the number of births. But not even a female Green Party voter would believe there is a causality.

I come back to the system. You see, I’m always talking with some very intelligent and very wise scientists, engineers, and so on. But not one of them really claims to have fully understood the climate system. There is no one in the world who has understood the climate system; no one. They are just narrowing it within their [system], and there is no evidence whatsoever. No evidence that CO₂ accounts for temperature rise. No evidence. Okay.

‘Suicide in Fear of Death’

Coming back to the EU policy, EU climate policy is suicide in fear of death, very clearly. Suicide in fear of death. If I’m very fearful of dying, I commit suicide. In December 2019, the EU Commission, [specifically] a French literature expert, launched the Green Deal. And afterwards, all the commissioners wrote 55 papers; each paper this thick [he gestures]. Nobody ever can read that, nobody; neither in the industry nor somewhere else. Nobody. And even if they do read it, they do not understand it; 55 papers.

One of those papers is the “EU Taxonomy.” The next is “Fit for 55.” The next is “EU Emissions Trading System II”—the first was not strong enough, therefore they made a second one. “The Green Deal Industrial Plan” is rather new. The “Net-Zero Industrial Act” is newer, it’s just three or four months old. Of course, we have a “Critical Raw Materials Act.” And then, in May 2023, they launched the “Carbon Border Adjustment Mechanism.” We all know that we are very, very successful in our protecting our frontiers; we all know that the EU is very, very successful. The next step is to protect our borders against CO₂. Now, that’s a real mission!

What would Friedrich Schiller have said about that? I’ll read it in German. “Das eben ist der Fluch der bösen Tat, Daß sie, fortzeugend, immer Böses muß gebären.” That is what Friedrich Schiller would have said about the situation. In English that means, “If you once created evil, it automatically spreads unless someone is able to stop it.” But who is it? That is one of the questions you are talking about right now.

Next we come to Figure 2, a nice picture of the future of the world. You can find it on the Internet, of course. So, who is launching that kind of picture? Investment, you can read, still has an opportunity to play its part in the race to reduce greenhouse gas emissions—investment. The Internet address is ESGclarity.com. ESG [stands for] Environmental, Social, and Government; and that is an EU-installed shadow-state to enable the financial community to grab into your pockets as deeply as possible. So, Friedrich Schiller would have said “Denn nur vom Nutzen wird die Welt regiert.” [“Because the world is ruled only by utility.”]

Let’s talk now about the climate policy in Germany.

The climate policy in Germany costs €6 billion annually. You know what a billion is? It’s very easy. That’s a thousand millions of euros. That is 1 billion. And it costs 6 billion just in Germany. Globally, achieving carbon neutrality (net-zero carbon emissions) will cost 1 trillion in annual average spending on physical assets. That’s 10¹²; that’s 10, with 12 nils. Okay. Who’s going to pay for that? Who’s going to even pay for 6 billion?

So who’s going to pay for the €6 billion? Just a very simple question. Is the state, is the government going to pay for that €6 billion? The government has no money; no money at all. They get their money from you. Are the companies going to pay the €6 billion? A company is not for paying for costs; they want to earn money. So there’s one very simple solution to the question. You, all of you who are sitting in this room, are going to pay the €6 billion. Of course, you are too old. No, you are too old. Yes, well, me as well. (I’m not.) But you all are going to pay for that €6 billion. And if you cannot, your children have to pay for it—very easy. But someone has to do so; €6 billion.

What Will Germans Do?

Now, we are going to calculate. You see, we have in Germany 15 million value creators. They get up in the morning doing something. And when they come home in the evening, they have done something that has earned money, that has created value. Fifteen million. I could say it in other words. Fifteen million people who pay the government more than they receive from the government. 15 million. Now divide 6 billion through [by] 15 million. So we calculate for a second. It’s €400,000. And a lady who is going to serve our poor people at the time being, for example, ill people or so, they can’t pay €400,000 until 2045. So that should be other people.

Let me say 5 million people in Germany are going to pay for €6 billion. That is €1,200,000 each of them has to pay until 2045. And if you would be in that situation, what would you do? Of course, you try to leave Germany as soon as possible. This is very human, I think. And it destroys not only the value creators, but the EU as well. You see, we are always talking about the EU, and I’m a German and I’m standing here not with pride.

I’m just going to tell you raw figures. As shown in Figure 3, Germany delivers 25% of the EU’s economic performance. Imagine what will happen to the EU if Germany can’t pay for it. Just try to imagine. And in 17 of the 27 EU countries, they reach less than 10% of the German GDP; less than 10%. So, in the worldwide context, it’s not easy for me to say so, but just from the financial point of view, in the worldwide context, they are nothing. Nice people living there, but financially, they are nearly nothing.

Let’s talk about energy, a very, very complicated theme. How much energy do you have? You personally. No idea? [Start with your basal metabolic rate of] 100 watts. That is your [rate of] energy [use]; you can receive [energy at the rate of] 100 watts. So, for one megawatt hour [of energy], you have to work 120,000 hours [sic]. [Now,] mankind was always clever. After they have related that, that they have to work very much and very hard for one megawatt hour, they invented the horse. The horse helped them, in that the horse only needs 1,360 hours. That’s pure physics. You see, that is nothing [but] that [which] comes from pure physics.

So now we are looking at coal. You need 120 kilograms of coal to generate one megawatt hour. So afterwards, after the horse, people invented coal. And then they saw that it is much easier to do things with oil. You only need 86 kg of oil to get one megawatt hour. Then afterwards, gas was even more comfortable, so they used gas. Just 95 cubic meters of gas is one megawatt hour. Then the one megawatt hour of current is, of course, one megawatt hour. [With] hydrogen, you need 333 cubic meters of hydrogen to generate one megawatt hour. And 333 cubic meters is a high volume.

The [cost increase] factor from coal to hydrogen is 14. So if you say your industry is able to live with a factor of 14 in energy, everything is good. But I do not believe so.

Figure 4 depicts German power-plant capacity as of January 1, 2023. We eliminated nuclear [in Germany]. The next step is to eliminate lignite [brown coal]. The next step is to eliminate coal [altogether]. The next step is to build 45 gas power stations. The next step is to install 50 gigawatts (GW) of wind [generating capacity]. The work done by 50 gigawatt hours of wind is only 10%, 20% of the installed capacity. I think you know that; 20%. If you install 1 GW of wind, you can only harvest 20% of it, because the wind does not blow all the time. And then we install 150 gigawatts of solar energy that cost, by the way, $300 billion. And afterwards we have a situation that I would call the Global West, if you understand what I mean.

So, just a word about the real truth of the gas situation in Germany. We talk a lot of gas, you see. And at the time being, we get half the gas that we did in 1919; half of the gas. And the gas is 250% more expensive today than in 1990. It is not the cost of the gas—perhaps we can live with that, but we do not have it. In the next winter it will be awfully hard in Germany to have a warm—how you call it in English—ass.

We will not be talking about something in the air tax [of the] EU emission trade system, because of the time. You see that the transformation of industry needs material—in this case, metals. And there is a university that is a Catholic university in Leuven, so they should not lie. And they said that we need 2,100% of the lithium that we needed in 2020—2,100%. And hear what I say: Never, ever will we get that amount of lithium to make e-mobility. Never, ever.

Figure 5 gives you a sense of the world’s metals and cement refining, as of 2019. Refining means you dig something out of the earth, you see, and afterwards you make metals and cement out of it; that is refining. And you see, for example, Germany has a very strong position. We are doing 1.5% of the world refining, and our partner in the U.S. is very strong as well. They are doing 3.6%. Others are a little bit stronger. China is standing for 50% alone.

So, German industry, what is a German industry? We have 7,000 industry firms, excluding small- and medium-sized companies; 15% of them are “climate intensive.” They have 930,000 employees. They earn a gross value added of €3.1 billion and they need 700 terawatt hours of energy. What is a terawatt hour? Very easy: one terawatt hour is 1,000,000,000 kilowatt hours. You need at your home 4,000 kilowatt hours, and industry needs 700 terawatt hours. A slight difference. So, when the price for electricity and gas is going up by €1, that costs German industry €350 million. And we are talking about €50 and we are talking about €100. And now you only have to multiply 350 million by 100 and then you have the sum that German industry is dealing with.

The Deindustrialization of Germany

The health conditions are not so very good in intensive industry; we are shrinking year by year.

Just to look at German industry: Germany had had a rather strong industry in 2014 (see Figure 6). We were building about 5.5 million passenger cars in Germany. That was about 30% of all the cars that have been sold by German automotive factories. So really, we are building 15 million cars around the world, and in Germany we build 3.5 million. That’s about roughly about 30% or so we are building in Germany. Germany is by far the most expensive automotive construction country in the world, and German industry is fleeing. You can see it from the downward sloping curve.

So, metals, just to mention. Ten megawatt hours of electrolysis is needed to process one ton of aluminum—if you produce aluminum here, on the premises, you need 10 megawatt hours. The current cost in Germany is €1,500 for 10 megawatt hours. The price at the London Metal Exchange is €1,975. The aluminum industry in Europe is dying. That [cost difference] will never, ever happen in the future. The same with the copper industry; the same with the steel industry.

And with these good views in the future, I will leave you alone.

Thank you very much.