Wintershall Dea on the European Commisson’s ‘Fit for 55’ Package

Source: press release, 14 July 2021

photo: Wintershall Dea
photo: Wintershall Dea

Wintershall Dea supports the goal of a climate-neutral Europe 2050 set out in the new European Climate Change Act and the 55% climate target for 2030. “There is no time to lose. Like the European Commission, we see the urgent need for swift action to achieve our climate targets. That includes generating power from natural gas instead of coal, and using new technologies,” says Mario Mehren, CEO of Europe’s leading independent gas and oil company Wintershall Dea.

“We can only achieve these goals with a technology-neutral framework. Especially if we want to maintain social acceptance and secure Europe’s business competitiveness at the same time,” Mehren adds. Studies show that a climate-neutral Europe can be achieved much more affordably through technology-neutrality than with policies relying primarily on renewable energy. According to the Hydrogen4EU study, this would save EUR 70 billion every year until 2050 – a total of over two trillion euros.

We need both electricity and gas in the future
“The Council, Commission and Parliament should make the principle of technology-neutrality become the guiding standard for improvements in the design. In addition, this must be flanked by the benchmark of CO2 mitigation costs,” Mehren demands. “The decisive contributions that gas can make to decarbonisation should always be taken into account. Gaseous energy sources are necessary and sustainable; alongside electricity gas should be the second, flexible pillar of a European energy transition.”

In order to itself make an active contribution, Europe’s leading independent gas and oil company has also set ambitious goals: for example, to reduce its greenhouse gas emissions from production activities (Scope 1 and 2) to net zero by 2030. This applies worldwide to projects operated by the company itself as well as proportionately to projects operated by partners (on an equity share basis). Wintershall Dea will maintain its methane intensity of 0.1% or lower beyond 2025. To reduce emissions from the use of the gas and oil it produces, Wintershall Dea is working intensively on new technologies in the field of hydrogen and CCS (carbon capture and storage).

“We have been contributing to a reliable and secure European energy supply for decades,” says Mario Mehren. With 70% natural gas in its portfolio today, the company contributes to an efficient, climate-friendly and at the same time socially acceptable energy supply. “Change has always been part of our corporate DNA. We shape change and seize opportunities and have done for 125 years: from potash and salt to crude oil, then to natural gas and now to technologies such as CCS and hydrogen. We are tackling emissions reduction.” With a newly established Carbon Management and Hydrogen business unit, Wintershall Dea is developing concrete, application-oriented decarbonisation solutions.

Mario Mehren, Wintershall Dea CEO, on specific elements of the “Fit for 55” package:

  • ETS: “We see CO2 pricing as a key element for a successful European energy transition. The European emissions trading system has contributed decisively to cost-efficient CO2 reduction – and above all provided a push for the coal-to-gas switch. This switch from coal to gas-fired power generation can still make an important contribution to climate protection in the future. Strengthening this system can further push the function of the ETS as a climate protection engine.”
  • Revision of RED II: “Electricity accounts for only a small share of final energy consumption in Germany and Europe (20% in Germany). Therefore, the revision of RED II should be broader and also take into account the potential of decarbonised gases. An essential prerequisite for tapping this potential is the introduction of tradable guarantees of origin based on the ‘book-and-claim system’. Both renewable and climate-friendly gases must be able to participate in this system – fragmentation would prevent the development of a strong and liquid European hydrogen market.”
  • Revision Energy Efficiency Directive (EED): “Measures to further increase energy efficiency are essential if we want to achieve the European climate targets. But increased energy efficiency is not a ‘goal in itself’, but an instrument for reducing CO2 In this respect, it also competes with other climate protection instruments. We therefore take a critical view of an ‘efficiency-first’ principle. Energy efficiency must not be misunderstood exclusively as an absolute savings target. It must also consider e.g., the overarching goal of GHG reduction and the need for flexibility due to an increasing share of renewable energies.”
  • CBAM: “Avoiding carbon leakage is important for the competitiveness of Europe as a business location. The mechanism should above all be used as an effective political lever in the international climate protection negotiations. Beforehand, all associated opportunities and risks should be carefully weighed up and compared with alternatives. The central role here must be WTO compatibility.”