The year 2022 was difficult for VNG. The company reported a loss of 337 million euros (not 450 million euros, as I wrote in the last edition after misinterpreting figures in the EnBW annual report). Adjusted earnings before interest and taxes (EBIT) were minus 205 million euros. In 2021, a consolidated profit of 141 euros was achieved, with an EBIT of plus 225 million euros. Nevertheless, and I found this quite impressive, there was no sense of crisis at the annual press conference at the beginning of April. Thanks to the compensation payments from the German government for a part of the loss from the contract with Gazprom Export (ener|gate Gasmarkt 04/23), the settlement with SEFE on the WIEH contract (ener|gate Gasmarkt 11/22) and the capital increase, VNG was able to cope with the loss. The VNG board is increasingly thinking about the future role of VNG, especially in a hydrogen economy. Even though the VG 2030+ strategy is now a few years old, at this year’s VNG annual press conference, I had the impression for the first time that the board at least has a comprehensible idea of how a future business model for VNG could work that fits in with the structure and organisation of the company. More on this later. First, a little about the company's past and present...
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- Issue title:
VNG
- Publication date:
- 04.05.2023
- In this issue:
In view of the discussions about the amendment to the German Buildings Energy Act (Gebäudeenergiegesetz – GEG), this amendment would have been a nice Topic of the Month. But for technical reasons, the deadline for this edition was relatively early (24 April). And it was only after the Cabinet approved the bill on 19 April that things really got heated. Personally, I like the fact that the law puts the decarbonisation of the heating market very high on the agenda. Up until now, approaches to decarbonising the heating market have been rather half-hearted. Considering the intensity of the debate, the previous reluctance to act in this area is understandable. In the heating market for existing buildings, the Energiewende (energy transition) is leaving every comfort zone. But this is no excuse: if we want to achieve our climate protection targets, we have to address the issue. In principle, I also like the fact that for the hydrogen option as an instrument for decarbonisation, the distribution grid operators must present a transformation path for the grid. In general, however, the draft has its shortcomings.
In particular, the Federal Ministry of Economics and Climate Action (BMWK) basically relies on the two fulfilment options of heat pumps and green district heating. The assumption is that this will work, especially in the case of heat pumps. This means that the expansion of renewable energies is progressing according to plan, as are the expansion of transmission and distribution grids as well as the market ramp-up and the necessary technological development of heat pumps. Manufacturers are optimistic about the latter. What I find problematic is the abrupt and rigid deadline of 2024 for implementing the "no new gas heating" mantra. Since hydrogen in particular is not (yet?) available, there is of course no solution available at present that involves minimal intervention in existing systems. Proponents of hydrogen solutions need to demonstrate sufficient availability of hydrogen, not just claim it. However, I would have liked to see a more detailed examination of the possible effects of a rising CO2 price and a stronger focus on municipal heating concepts. In addition, perhaps the initial focus should be on decarbonising district heating, as this uses existing systems. Let's see what else the legislative process brings. What will happen if nothing else changes? The number of new gas heating systems installed will increase in 2023, and then existing systems will be used for as long as possible. My concern is that federal policy will have a kind of energy price brake 2.0 experience.
Well, I have spent the whole editorial bothering you with my half-baked reflections on the GEG. But there is more to read in this issue, so please do so with pleasure.
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