NAlmost unnoticed, the Economic Stabilization Fund granted another large loan at the end of June: 500 million euros went to the wind turbine manufacturer Enercon from the East Frisian town of Aurich.
Actually, one would think that the wind business is a gold mine in times of the energy transition. In fact, however, Enercon is in a crisis, like most other companies in the industry. Long approval processes and significant price pressure have stalled business and wiped out thousands of jobs. All major providers are making losses. The listed Enercon competitor Nordex has carried out two capital increases in recent weeks in order to have enough liquidity again.
On paper, the state loan for Enercon runs under the Corona Aid heading. The Economic Stabilization Fund, or WSF for short, was set up in spring 2020 by the then ruling grand coalition to help companies that were threatened by the sudden standstill of public life. Almost two dozen companies received a total of 9 billion euros from the WSF until it expired at the end of June. Lufthansa, TUI and Galeria Karstadt Kaufhof are among the best-known companies supported by the fund.
Large dependence on imports from abroad
In the case of Enercon, unexpected additional costs for material, transport and logistics as a result of the pandemic were given as reasons why it was no longer possible without state aid. The decision should have been easy for the state secretaries of the finance and economics ministries. After all, the expansion of renewable energies is a core concern of the traffic light coalition. Even if nobody in Berlin likes to say it so clearly: the help for Enercon is also to be understood as an industrial policy sign.
Economics and Climate Minister Robert Habeck (Greens) cannot please the latest figures from the German Wind Energy Association. In the first half of 2022, the construction of wind turbines on land in Germany stagnated. Just 238 new wind turbines were installed, which roughly corresponds to the previous year’s figure. Habeck said in December that the numbers would have to triple. At the beginning of July, the Bundestag and Bundesrat introduced a package of laws intended to speed up the expansion. The federal states are to designate significantly more areas for wind turbines. Not supporting the German market leader in this segment at such a time would have put the government in need of explanations.
Enercon belongs to a foundation named after the founder Aloys Wobben and therefore has a harder time raising capital than others. In addition, the company is still in the middle of a restructuring. The EEG amendment in 2016, which only subsidized the cheapest offer with a good feed-in tariff, was a turning point for the high-price provider. The company had previously installed more than 700 wind turbines a year in Germany, and afterwards you could count the number on a few hands. However, things are now looking up again: Enercon installed 169 wind turbines in Germany last year, and three times as many projects were implemented abroad. At 2,500 megawatts, the installed capacity is still well below the previous peak value of 3,500 megawatts, but growth rates have recently been in double digits. Enercon wants to break even this year.