Europe is sacrificing its industry on the altar of the “ideology” of net zero carbon emissions, the chairman of Siemens Energy warned in dramatic terms.
Joe Kaeser said that strict net zero targets have paralyzed manufacturing and heavy industry in Germany and beyond.
He called on the German government to work on a more “economically viable plan” for decarbonizing the industrial base.
“Critics are right when they say that you risk your economic strength and the prosperity of society when you treat net zero in an ideological way,” he said.
His comments are expected to raise questions about the United Kingdom’s approach to net zero as well, as official forecasts show it will add hundreds of billions of euros or pounds to public spending over the coming decades.
They will become subordinates of Beijing
Beyond the issue of cost, the United Kingdom and Europe are facing growing pressure from the United States to soften their plans, which officials in the Trump administration argue are making countries “subordinate” to Beijing.
Keir Starmer is set to travel to China this week, in the first visit by a British prime minister since 2018, with energy likely to be among the topics of discussion.
Kaeser, who previously led the German industrial giant Siemens before taking over the chairmanship of its energy arm, warned that European companies are becoming uncompetitive because of green energy policies.
He criticized the government in Berlin for imposing net zero targets on automakers and requiring companies to prove that the products they sell are not linked to deforestation.
Sacrificing cheap and reliable energy
The German executive also criticized officials for sacrificing cheap and reliable energy by abandoning fossil fuels.
“They have become ideologues of renewables.
That is a bad idea. If you are an industrial country and you cannot offer a sustainable, affordable, and reliable source of energy, then you have a problem,” Kaeser said.
Germany’s share of global emissions is now less than 2%, far lower than other industrialized countries such as Brazil and India, and, as he said, even if it were halved, the difference at a global level would be negligible.
By comparison, China now accounts for roughly one third of global carbon emissions, while the United Kingdom’s share is less than 1%.
“Why would you risk your industrial competitiveness when, in the global debate, you are merely a rounding error?” he asked.
Germany has set a target of achieving net zero carbon emissions by 2045, a more aggressive goal than the legally binding 2050 deadline set by Britain.
Rules are crushing demand
Kaeser, who is also chairman of Daimler Trucks, attacked the European Union’s approach of pursuing net zero through regulation.
He argued that Brussels spends far too much time setting rules for industry without considering how these rules may crush demand.
Under current targets, 43% of Europe’s heavy truck fleet must be electric by 2030, 65% by 2035, and 90% by 2040.
Manufacturers that fail to comply face huge fines.
“The EU regulates everything,” he said. “It regulates the supply side. That is, the EU tells us, we no longer want the diesel truck. They do not go to the customer to ask about demand: what are you planning to do? What is your business model?”
The explosion of costs
The chairman of Siemens Energy was speaking at the World Economic Forum in Davos, Switzerland, where global leaders and business elites gathered this week.
Although much of the event was dominated by Donald Trump’s threats regarding Greenland, American officials also used the summit to criticize Europe’s net zero policies.
Trump used his speech to attack the “green new scam”, calling the green ideology a fraud.
Howard Lutnick, United States Secretary of Commerce, warned that Europe is becoming “subordinate” to China because it depends on Beijing for products such as electric vehicle batteries.
Most of Britain’s solar panels now come from China, while Ed Miliband, the British Energy Secretary, is also pushing for a rapid expansion of wind power in the United Kingdom.
Chinese companies dominate wind turbine production.
Siemens Energy, which operates a factory in Hull, is still dealing with the fallout from the wind power crisis caused by quality problems and soaring production costs.
The crisis forced the German government to bail out the company in 2023.
Kaeser said the company remains committed to restructuring the sector and turning it profitable.
By contrast, orders for the company’s gas turbines are rising rapidly as demand grows for artificial intelligence data centers.
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