High electricity prices: silicon plant in crisis

Status: 03/28/2023 2:06 p.m

Silicon is used, for example, for the production of microchips and photovoltaic systems. Despite this, Germany’s only raw silicon plant is in crisis. Production is on the back burner.

By Katharina Haeringer, BR

Wearing a helmet and goggles, a worker stands in front of a furnace that is more than 2000 degrees. As the flames roar, he stabs a hole in the furnace with a long pole. Liquid silicon runs out. It dusts, hisses and hums. But for the workers it is unusually quiet and not as hot as usual. Only the “Frieder” oven, and thus only one of four ovens, is in operation. The others stand still.

Because of the high electricity costs, RW Silicon GmbH in Pocking, Lower Bavaria, cannot afford to run all four firing machines, explains Managing Director Stefan Bauer. He’s standing in the plant’s control center and pointing to the electricity meter. Its wheel turns and turns. “That’s exactly the problem: it’s simply an energy-intensive process,” says Bauer. Electricity accounts for half of the manufacturing cost of silicon. Operations were therefore completely suspended in January and February.

View of the “Frieder” furnace at the RWsilicon plant in Lower Bavaria.

Image: BR/Katharina Häringer

“France undercuts everything”

According to its own statements, RW Silicon GmbH, also known as Rottwerk, is Germany’s only manufacturer of raw silicon. The company processes quartz from the Bavarian Forest, the Czech Republic and Austria. The silicon that is used in many ways is produced by adding coal and extremely high heat, including in the production of solar cells, microchips, silicone and aluminum alloys.

Even if the products containing silicon are in demand, the German plant has a big problem: it doesn’t stand a chance against the competition in France. The state caps the electricity there. “Our competitors undercut everything. That’s why we’re in trouble,” says Bauer and provides an example calculation: A year and a half ago, the electricity costs to produce one ton of silicon in Germany were 600 euros. At the beginning of this year, they were around 2,000 euros, and at the moment around 1,500. “In France, companies pay about half that,” says Bauer.

The electricity price brake introduced by the German federal government does not help either. It makes it possible for energy-intensive companies to pay a maximum of 13 cents per kilowatt hour for 70 percent of the previous consumption. However, market prices are below that at the moment. “Anyone who buys electricity on the spot market currently pays between eleven and a half and twelve cents. For us, the electricity price brake is no longer valid,” says Bauer.

This furnace in the RW Silicon plant in Pocking is currently not in operation – because of the high electricity prices.

Image: BR/Katharina Häringer

Industry calls for industry prize

In order for the plant and its 120 employees to survive, an industrial electricity price must be introduced in Germany, says Managing Director Bauer. He is not alone in this demand. The industrial unions see hundreds of thousands of jobs at risk because of the high electricity prices in Germany. The IG Metall, IG BCE and IG BAU unions said there was a risk of site closures in the steel, chemical and building materials industries at the beginning of the month.

The first federal states are also pushing for the introduction of lower electricity prices for industry. Armin Willingmann (SPD), Energy Minister in Saxony-Anhalt and Chairman of the Energy Ministers’ Conference, told the dpa news agency: “We need a reliable, plannable price for bulk buyers.”

The Bavarian Ministry of Economic Affairs sees the competitiveness of companies in the Free State at risk. On request, it says: “The industrial companies still based in Germany can only get investment security, jobs and prosperity are secured through an industrial electricity price.”

120 employees work for the silicon plant.

Image: BR/Katharina Häringer

Waiting for Minister Habeck’s plans

Federal Economics Minister Robert Habeck (Greens) had already announced that he would present a concept for an industrial electricity price. The federal government should have an interest in not making itself dependent on imports. China is already the largest producer of silicon and dominates the world market.

The employees in Pocking in the district of Passau fear for their jobs. The electrician and works council chairman Gerhard Leitner says: “It’s also about livelihoods. Some of us have built a house and taken out loans. I’ve been working here for 30 years and would also like to retire here.”

After all, it has been possible to work with reduced hours again since March. This gives the workforce hope that not only “Frieder”, but also the other three ovens named “Sepp”, “Stephan” and “Detlef” will soon be started up again.

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