Interview Yves-Maurice Radwan: “The direction is right, but the pace is not”

Basically, the direction is right: further expansion of renewable energies, including hydrogen and the necessary electricity infrastructure, is inevitable and the only way out in the long term. In the short term, however, we are forced to again make greater use of fossil alternatives to gas for the next one or two winters. This is regrettable, but unfortunately unavoidable at the moment. It is therefore right for the government to now want to create even more pressure to expand renewable energies. But here’s the rub: the intentions are good and the course is right too, but the pace is not. The expansion is still not fast and determined enough.

That is certainly correct, but I would like to stress that we should not just talk about failures. The share of renewables in the German electricity mix is quite considerable now, at around 50 percent. For many years, Germany was a pioneer in the expansion of renewables in Europe. However, we have not consistently continued the expansion of wind energy in particular and have lost our leading position. We could have gone a lot further. This makes it all the more important now to reverse the trend. However, further expansion is still slowing down, partly because approval processes take too long and suitable new areas are no longer designated.

That is certainly correct, but I would like to stress that we should not just talk about failures. The share of renewables in the German electricity mix is quite considerable now, at around 50 percent. For many years, Germany was a pioneer in the expansion of renewables in Europe. However, we have not consistently continued the expansion of wind energy in particular and have lost our leading position. We could have gone a lot further. This makes it all the more important now to reverse the trend. However, further expansion is still slowing down, partly because approval processes take too long and suitable new areas are no longer designated.

In our project developments, we cover large parts of the value chain as far as possible ourselves and in-house. As a result, we have better control over price pressure and the implementation phase. In addition, it is essential to coordinate with suppliers and construction service providers at an early stage in order to get a clear picture of costs and delivery times early on. Components with currently very long delivery times, such as transformers, require particular attention to ensure projects are completed on time. Of course, despite wanting to take all the required precautions, the topic is not completely passed on to us – nor are the increased financing costs – but we have the situation under control overall.

In the long term, the higher production costs will at least in part also be compensated for by the higher earnings potential as a result of the higher electricity prices. However, it remains to be seen whether we also have to expect state intervention in the market in Germany.

In principle, this is possible, but a major challenge – especially since the demand for electricity will not decline, but increase in the future, not least due to the switch to electromobility and electrically powered heating. Further decisive expansion of generation capacity is therefore urgently required. But that’s not all – the decisive factor is not only the amount of electricity produced, but also its base load capability. In order to guarantee this, generation as well as storage and grid capacities in particular must be expanded: pump storage, batteries, power-to-gas, “green” hydrogen, smart transmission networks and much more.

Furthermore, European electricity networks would need to become even more integrated in order to diversify and thus smooth out generation profiles. Last but not least, it is important to use as many renewable energy sources as possible, i.e. not only wind and solar, but also hydropower, geothermal energy and biomass. Of course, the main load will be on wind energy and photovoltaics. These are also the two types of generation that are also at the heart of Commerz Real.