Keeping the eye on the ball

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Courtesy of European Energy Review (EER)

Reinier Zwitserloot may not be among the world’s most famous corporate executives, he is one of the most influential. In his eight years as head of German gas and oil producer Wintershall, a subsidiary of BASF, the Dutchman, who is retiring on the first of October, managed to build up an impressive network of political contacts in Germany and Russia. And he grew the business. ‘If you really want something in life’, he says, ‘you can get it.’

we could have afforded over €50 bln for Yuzhno. Well, we invested just around €2 bln.’

Zwitserloot cites the biogas story to show the huge challenge the world is facing in making a transition to a low-carbon economy. He is convinced this transition is necessary – ‘I do think we have a climate problem and we have to stop the temperature rise’ – but disdains what he calls “ecoromanticism”. ‘I learned this word from my colleague Rainer Seele: Öko-Romantik. It’s good to invest in alternative energies, but we should not romanticize them. There has to be a link between economy and ecology. For example, I don’t see why we should go to the trouble of cleaning up and upgrading biogas to be able to feed it into the natural gas grid. It’s not profitable. It makes much more sense to use biogas to generate electricity locally, at places that are removed from the grid.’

Whichever way you look at it, says Zwitserloot, the contribution biogas and other forms of alternative energy, such as offshore wind, will be able to make to the total energy consumption, will remain limited for a long time to come. ‘The IEA has calculated that even if we take all the climate measures already agreed to, fossil fuels will still contribute 80% of our energy needs in 2030.’ Rather than just focusing on renewables, we should focus much more on energy saving and energy efficiency on the one side, and technological innovation on the other, according to the Wintershall-chief. ‘We need to solve this intelligently, not politically-populistically. It’s a global problem anyway, so we have no choice. Non-OECD countries are already emitting more CO2 than OECD countries.’

Einiges los

Zwitserloot is convinced that natural gas (‘my energy’, as he almost lovingly calls it) will play a crucial role as a transition fuel in the coming decades. ‘A lot of the CO2 reductions in the last Reinier Zwitserloot is a man of passionate convictions. On this August morning at the breakfast table in his office in Kassel, he pounds on the last issue of European Energy Review. ‘It’s very interesting what I read here!’ he exclaims. ‘About the biogas boom in Germany. Germany’s largest Biogas project will produce 46 mln m3 of gas per year. That’s a lot of gas, for sure. At the Yuzhno Russkoye field, in Russia (a Gazprom/Wintershall cooperation, ed.) we produce 75 mln m3 – per day. Yesterday, today, tomorrow, every day. And the cost? The biogas project costs €100 mln. On this basis years are the result of energy producers switching from oil and coal to gas. This effect is quite underestimated. And gas offers the perfect symbiosis with intermittent forms of sustainable energy, such as wind and solar, because it is the most flexible source for back-up electricity generation. Oil will become mainly a transport fuel and in this area it will almost certainly get heavy competition from electric cars. Once the drive towards electric cars get started, things can go fast. Da ist einiges los. But if this happens, the electricity for the cars will have to be generated too, and for this gas again is the ideal solution in combination with sustainable energy.’

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