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Speech by Government Minister Axel Horstmann to the 3rd Annual Conference of the NRW Fuel-Cell Expertise Network ‘Energy expertise – a key element in future energy policy’,

I am delighted to be at the 3rd Annual NRW Fuel-Cell Expertise Network in Wuppertal and to have the opportunity to talk about energy policy in North Rhine-Westphalia. The venue is a good choice, for here in the triangle of Remscheid, Solingen and Wuppertal much has been done as part of the Regional 2006 programme to put the spotlight on the structural changes that are needed in our state.

Dr Axel Horstmann

Driving this structural change forwards is one of the greatest challenges facing us in NRW. In this sense we regard sustainable energy policy as innovation with a focus on industry, technology and regional infrastructure. Sustainable energy policy means creating a favourable framework within which the companies and research establishments in North Rhine-Westphalia are able to develop, produce and apply innovative and competitive technologies for energy utilisation and in this way to create new jobs and safeguard existing ones. An important key North Rhine-Westphalia, Germany’s number-one energy centre, is and will continue to be an important key for growth and employment. About one third of Germany’s electricity is generated and consumed in this region. Our economy and our jobs are heavily dependent on energy being supplied on a reliable and cost-effective basis. And with more than 80% of our oil and gas now being imported that is no easy task. Climate protection But we must also give climate protection its due status. And naturally we in North Rhine-Westphalia also have to contribute to reducing the damaging CO2 emissions. We see this not just as an ecological task but also as an economic opportunity. For the development, manufacture and application of products and processes for increasing efficiency in energy generation as well as in energy utilisation, accompanied by a reduction in emission levels, will create future jobs and generate income. Three objectives Against a background of conflicting priorities for security of supply, competitiveness and environmental sustainability our energy policy is based around three key objectives: efficient energy generation, rational energy use and increased application of renewables.

Efficient energy generation. ‘Efficient energy generation’ means developing and using modern energy technologies that will allow us to make efficient use of our major primary fuels, namely lignite, coal, gas and oil, while at the same time exploiting our resources in a rational way. A concrete example of this is the new lignite-fired generating plant that has been built in North Rhine-Westphalia, which can currently claim to be the most modern in the world. This 950-megawatt facility can achieve an efficiency rate of 43% – a world record. Previous outdated technology has only been capable of 35.5% efficiency. The new installation can now generate the same amount of electricity with 20% less lignite. This makes for a corresponding reduction in CO₂, dust, sulphur dioxide and nitrogen oxide. And that is not all, for the next technology leap is already being prepared: the new ‘BoA plus’ system (lignite plant with optimised engineering) is able to pre-dry the fuel and in this way to boost efficiency to some 48%, along with a corresponding reduction in CO₂ emissions.

And the coal-fired plant builders in North Rhine-Westphalia are also working with the operators to achieve similar goals. The new reference power plant will employ the latest tried-and-tested technology to raise efficiency rates from the current 37% to some 47%. These reference power stations will allow us to demonstrate how we can secure an efficient supply of fossil fuel-based energy and at the same time save on resources and protect the environment.

Coal is an extremely versatile fuel: it can – as just described – be burnt very efficiently and can also be used to manufacture hydrogen so as to drive a fuel cell, for example. Before I turn my attention to the important topic of fuel cells allow me briefly to outline our two other energy policy objectives.

Rational use of energy.

Here we have initiated a series of measures and set up a number of facilities in North Rhine-Westphalia. As time is short I would just like to cite one example of this, namely the NRW Energy Agency, which offers advice to the business community, local authorities and private consumers on how they can reduce their energy consumption to an absolute minimum so as to develop greater financial leeway.

Increased use of renewables

In this area our main focus in North Rhine-Westphalia is on solar and bio energy and on the use of geothermal sources, including heat pump technology.

While renewables will not be replacing conventional forms of energy either now or in the foreseeable future, they will nevertheless have an increasingly important role to play in the years to come. But their contribution will only increase significantly and sustainably when we succeed in making them more cost effective. And the Government of North Rhine-Westphalia is applying a number of targeted measures in this respect. In 1988 we launched the REN programme to promote the development, demonstration, production and application of new technologies for the rational use of energy and for the exploitation of renewable energy sources. To date the programme has funded some 46,000 projects to the tune of almost € 560 million and – what is more decisive – attracted investment totalling € 2.5 bn.

The development, production and application of processes for renewables utilisation helps protect the environment and at the same time generates employment opportunities. Recent surveys have indicated that more than 2,100 firms and some 15,000 people are now directly involved in the renewables sector alone in North Rhine-Westphalia. We were able to identify this job-market potential at an early stage and a result launched the regional initiative ‘Future energies for NRW’ in 1996. This has allowed us to pool North Rhine-Westphalia’s existing scientific, industrial and political resources. With its 18 working groups and networks this regional initiative acts as a strategic platform for the future-energies sector and serves as an advisory forum, information exchange, meeting-place and cooperation centre. One such group is the NRW Fuel-cell Expertise Network, which today celebrates its third anniversary.

Energy converter

It would be like carrying coals to Newcastle if I were to start to tell experts like you about the specific technical benefits of the fuel cell, such as high efficiency rates and low emission levels. Neither do I need to detail the many ways in this technology can be used in fixed, mobile and portable applications. Today authoritative professionals like you will have an opportunity to present the latest developments and future prospects in this area. But I can tell you how much the Government values this innovative technology and what conclusions the regional authorities in North Rhine-Westphalia are drawing from it.

Due to its complexity and interdisciplinary nature this new technology presents a wide range of opportunities not just for the major companies but for small and medium-sized firms too: and it is the latter that have the capability to react with lightning speed to new market demands. In North Rhine-Westphalia especially we have many such businesses – including a number here too in Bergische Land – that have for the most part evolved from quite different sectors and they have the capacity to transfer their technical know-how and experience to new problem-solving tasks.

The fuel cell as a highly efficient, clean and low-noise energy converter can give our entrepreneurs qualified access to completely new markets. It can therefore not only safeguard our energy supply and preserve and create jobs in the years ahead but also make an active contribution to climate and environmental protection.

Prevailing in the face of more-mature systems

Early in the current development phase this general perception led in some quarters to extremely optimistic hopes for the imminent introduction of mass-produced fuel cells. But the fuel cell is primarily a substitute product and is obliged to compete with established systems. This means that as a mass-produced item it has to have the technical and economic advantages to prevail over more-mature products. Any large-scale application may well therefore take years to achieve, though some economic success is possible in niche applications in the short to medium term.

I do not want to dampen your enthusiasm by commenting on the costs involved. In fact quite the reverse. I want to encourage you to an even greater level of commitment. And it is precisely because technical development and economic success take time that we must not delay further in getting our act into gear. We need to develop and manufacture new types of components and systems and we must also design and implement cost-effective manufacturing processes. We also have to tackle the question of where we are going to source the hydrogen that will be needed to operate the fuel cell technology, and how we are going to transport and store it.

Taking action, tackling the problem, moving things forward

Dante Alghieri once said: “Some wait until times change, others get down to it and act.” Let us not be like those who wait while other others come and steal the cake from right under our nose. Let us be like those who act, who want to tackle the problem, who want to move things forward. Like the Ministries of North Rhine-Westphalia we too will support you in your efforts. The Ministry of Energy has promoted fuel cell technology to one of the five funding targets in the energy sector and will be making appropriate resources available from the REN programme. In conjunction with the Ministry of Science we have already sponsored some 42 projects by granting more than € 40 million to make a total investment of over € 77 million.

Successful participants

We are also providing support other than financial for the fuel-cell projects. The Government of North Rhine-Westphalia sees itself as a provider of industrial and scientific services and in support of this set up the “NRW Fuel-Cell Expertise Network” in April 2000. The object of this network is to support companies and research establishments in North Rhine-Westphalia who wish to become active and successful participants in the very promising new fuel-cell technology. Our efforts have clearly hit the mark and the network’s broad range of services, from information exchange via study groups and workshops through to the initiation of projects and cooperative ventures, is very much in demand. The network now comprises some 280 highly committed companies and research establishments and the number is growing. The network is also involved internationally and along with French partners from the Grenoble area and Italian partners from Milan network members have got together to set up a European community project. Invitations have been accepted to attend events in the USA, Canada and Japan, where network members will be able to exchange information and forge new business links. Britain has also used the experience acquired from the NRW network to set up one of its own – Fuel Cells UK. This positive response speaks for the quality of the network system.

Celebrating success together

The Government of North Rhine-Westphalia wants to provide you with a favourable operating environment and the support you need to strengthen and develop the region’s energy expertise. My aim is to work together with the many dedicated firms and research establishments of the North Rhine-Westphalia network to put us at the forefront of fuel-cell technology.

After three years we can now make a provisional appraisal of our achievements. Fuel-cell technology in North Rhine-Westphalia is certainly still at a delicate stage, but the network’s members and organisers have already recorded some impressive achievements. Allow me to thank you all for your efforts to date with the hope that we will be celebrating further successes together in the years ahead.