A renewable energy rush

Renewable energy has created a “gold rush” atmosphere in Germany’s depressed north-east, giving the country’s poor good jobs and a great deal of future promise. The natural resources attracting investors and industry are of a simple variety: wind, sunshine, agricultural products and farm waste such as manure.

The rush to tap into the green resources in Mecklenburg-Vorpommern state is reminiscent of the frenzies that came with gold or oil discoveries in past centuries. The buzz can be felt in towns and sparkling new factories across the Baltic shore state. “Renewable energy has become extremely valuable for our state,” said the states premier, “It’s just a great opportunity – producing renewable energy and creating manufacturing jobs.”

“From an industrial point of view we’d been one of Germany’s weaker areas. But the country is abandoning nuclear power. That will work only if there’s a corresponding – and substantial – increase in renewables. It’ll be one of Germany’s most important sectors in the future. We want to be up there leading the way.”

The federal government performed a nationwide U-Turn on all nuclear power after the accident at the Fukushima Daiichi nuclear complex in Japan, set off by the March 11 earthquake and tsunami. Germany shut eight nuclear plants and will close the other nine by 2022. Germany is a world leader in renewable energy and wants an even larger share of the $211bn global market. A fifth of its electricity comes from renewables, up from six percent in 2000, and it aims to boost this to 35 percent by 2020.

There are some clouds on the horizon. State-mandated incentives, which fuelled a private investment boom, have been cut, squeezing margins in sectors such as solar energy. There have also been delays in expanding and upgrading the national grid of high-voltage transmission lines from sparsely populated coastal regions such as Mecklenburg-Vorpommern to areas where the power is most needed in the west and south. The federal government is working to remove these infrastructure bottlenecks, but if the grid is not expanded soon it could cause problems later when more off-shore wind power goes on line.

Eclipsing shipyards
Renewables – especially wind energy – are injecting new optimism into Mecklenburg-Vorpommern, reflected in a word that often comes up in conversations with business and political leaders: “Reindustrialisierung” (re-industrialisation). In a state with a sea-faring heritage, there are now more jobs in renewable energy than in shipyards: 6,000 jobs at 704 firms, expected to nearly quadruple to 22,000 by 2020. Companies are building, designing, maintaining and operating wind turbines and photovoltaic and biomass plants – for which farmers are growing crops and harvesting animal waste. There are more than 1,200 wind turbines on land, and a new push into off-shore wind energy in the Baltic will further fuel that growth.

Many new jobs are at firms such as Nordex, which employs 1,000 in Rostock making lightweight wind turbine rotor blades up to 65 meters long. It has invested ¤100m in expanding its plant and exports some 95 percent of its output. These are sorely needed, highly skilled jobs in a sparsely populated state whose industrial base was devastated by the economic upheaval accompanying Germany’s reunification in 1990. There were 32,800 jobs in the once∞bustling shipyards around the port city of Rostock when the Berlin Wall fell in 1989. But most were wiped out when the east German shipbuilding industry collapsed in the face of surging labour costs and fierce western competition.

Mecklenburg-Vorpommern became one of Germany’s poorest regions. The jobless rate soared to 20 percent in 2004 – double the national average – and the population fell by 250,000 to 1.6m as mostly young, well educated people moved to the more prosperous west in search of jobs. More than 8,000 left the state in 2008, but only 3,500 moved away in 2010.

The prospect that some areas could turn into ghost towns was an explosive issue, but the gloom is lifting as unemployment has been nearly halved. The state with the worst jobless rate of Germany’s 16 states in 2007 is now ahead of Berlin and Bremen. “There’s a new sense of optimism thanks to sectors such as renewable energy, and the migration westwards was slowed if not completely stopped,” said Edeltraud Guenther, a professor for environmental management at Dresden’s Technical University.