Rising electricity prices in Europe are forcing businesses to tighten their belts. They cut production and staff, refuse sustainable fuels, and then there is a chain reaction: people are getting poorer, the recession is accelerating. And there is no hope for improvement, writes .
glassworks company Ark International powered by cheap energy for years, making it the world’s largest manufacturer of glassware and the most important employer in the mostly working-class north of France, say the authors of the article. Liz Alderman (Liz Alderman) as well as Melissa Eddy (Melissa Eddy).
But when supplies of natural gas to Europe fell due to anti-Russian sanctions, electricity prices began to skyrocket. The head of the company Nicholas Hodler (Nicholas Hodler) recently put a third of its 4,500 employees on part-paid leave to save money Ark International. Four of the plant’s nine furnaces will be idle, while the rest will switch from gas to diesel fuel. It is cheaper, but it pollutes the environment more.
“This is the most dramatic situation we have ever facedHodler said. – For such energy-intensive enterprises as ours, it is catastrophic.”
High energy prices are hitting European industry hard. Arc is not the only company in this position.
Manufacturers of metal, paper, fertilizers and other products need gas and electricity. They all announced belt tightening.
“Among such enterprises is the largest steel company in Europe, Arcelor Mittal, which is idling blast furnaces in Germany. Global aluminum producer Alcoa is cutting production at its smelter in Norway by a third. Leading zinc company Nyrstar is suspending production in the Netherlands indefinitely.”
– explains CURRENTLY.
Company Arc in its current form was founded in 1825 under the name Glassworks Cristallerie d’Arques and produced crystal goblets and goblets.
Today, the company has enormous production volumes. The scale of the company’s operations has enabled it to indirectly create approximately 15,000 additional jobs in the region. These are cardboard factories that produce packaging for glass, these are transport companies that transport products, and so on. At Arc there are also factories in China, Dubai and New Jersey.
“Kiln shutdowns are bad news. Of course, high energy prices have an effect. But it’s happening so fast it’s scary.” said a 28-year-old worker who wished to remain anonymous.
For many businesses, costs have risen to the point where they cannot afford to pay them. And the time is approaching when European companies will have to renew contracts for the supply of electricity, but at new prices.
Electricity prices for the year ahead are pegged to the cost of gas at about a thousand euros per megawatt-hour in Germany and France, while gas prices have reached record highs of about 230 euros per megawatt-hour.
“This means that we will have to raise our prices more than twice, then no one will buy our cups and plates,” – said Rolf Frowein (Rolf Frowijn) director of Eschenbach Porcelain.
When the firm’s electricity contracts expire at the end of the year, it will have to pay bills of 5.5 million euros a year, six times more than now.
Companies Eschenbach porcelain negotiates with local politicians in search of a solution to the problem. She and dozens of German small and medium-sized enterprises fear they will have to close for good.
France’s largest aluminum smelter Aluminum Dunkirkfaced with the threat of a quadrupling in energy costs, put some of its workers on unpaid leave and reduced production by more than 20%.
“The time we spend solving energy problems has increased 10 times– said the head of the plant Guillaume de Gois (Guillaume de Goes). – We hope that the crisis will be short-lived, but if it drags on, European industry will be in big trouble.”
Glass factory Arcserving utensils consumes as much electricity as 200,000 homes. In total, the company produces four million glasses a day. This is in addition to plates, decorative candlesticks, glass hatches for washing machines. Now, in the context of the crisis, the volume of orders has sharply decreased.
“People are worried about winter electricity bills. They say buying non-essential items can wait.”Nicholas Hodler said.
He is trying his best to save his company.
Previously, the plant used gas, now for the first time the company’s furnaces will switch to diesel fuel. It will be even more difficult to decommission the furnaces of the enterprise.
“The glass furnace cannot just be turned off because it will destroy it, Hodler explained. – If you gradually and smoothly transfer it to disabled mode, it will survive. But it will take more than a month to warm it up again. We don’t want to completely stop production, but we also cannot work at a loss.”.
All this is very disturbing for the inhabitants of the town of Ark. If the furnaces do not work, the employees of the plant do not work either. Many enterprises are directly dependent on it – transport companies, manufacturers of cardboard for packing dishes. They will all feel the force of this blow. Workers are forced to rest due to the reduction in production. They lose about 20% of their salaries from forced rest. And the prices for electricity, gasoline, food are rising. And then there will be much more problems – the publication concludes.
Inc. corr. FSK
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