The energy provider Vattenfall and the specialty chemicals firm Evonik have finalized new long-term electricity supply agreements.
Beginning in 2025, two Vattenfall solar parks in Schleswig-Holstein will furnish Evonik with approximately 120 gigawatt hours of solar energy annually for chemical production. These contracts, lasting for ten years, feature fixed terms (“Power Purchase Agreement,” PPA), representing Evonik’s deliberate move towards increased utilization of renewable electricity.
“Germany is the fastest growing market for renewable energies in Europe,” emphasizes Martijn Hagens, responsible member of the Executive Board and Head of Business Area Markets at Vattenfall. “We see a wide range of growth opportunities here for the development and marketing of our solar, onshore and offshore projects. As the project with Evonik exemplifies, electricity partnerships with industry play a decisive role here.”
“Evonik has an ambitious sustainability strategy – and we are reliably implementing what we have set out to do: In 2022, Evonik concluded supply contracts for green electricity from wind power. In 2024, we look forward to the first major supply contracts for solar power. This marks another milestone on our way to converting our externally sourced electricity to 100% green by 2030,” says Thomas Wessel, the Executive Board member responsible for sustainability.
Specifically, the Power Purchase Agreements (PPAs) stipulate that Vattenfall will supply Evonik with electricity from two solar parks in Schleswig-Holstein. One solar park is located south of Flensburg in Silberstedt, with details of the second site to follow shortly. They are due to be completed and connected to the grid in 2025 with a total capacity of 120 megawatts peak (MWp).
The agreed electricity volume of around 120 gigawatt hours (GWh) per year corresponds to the annual demand of around 35,000 households and displaces more than 50,000 tonnes of CO2 per year in the German electricity mix. Vattenfall and Evonik expect this cooperation to provide investment security, security of supply with green electricity and risk diversification for both parties. The current agreements are valid for 10 years.
Thomas Wessel emphasizes the importance of the contracts with Vattenfall: “We are sourcing significantly more green electricity from external sources. Around 35 per cent of Evonik’s externally sourced electricity worldwide already comes from renewable sources. Thanks to the new agreements with Vattenfall, this share clearly exceeds the 50 per cent mark. We are therefore also making ourselves less dependent on fossil fuels.”
“The electricity partnership with Evonik underlines the long-term goal we are pursuing at Vattenfall: To enable fossil-free living along entire value chains,” explains Hagens. “This also includes our suppliers, our partners and our customers.” The electricity supply agreement includes partnership components such as a shared assumption of opportunities and risks in the operational management of the solar parks.
Chemical production necessitates a consistently reliable power supply. However, there often exists a disparity between the forecasted and actual generation of renewable energy sources. To address this challenge, Evonik employs a balancing group management system to oversee its chemical parks and facilities. This system enables Evonik to synchronize electricity supply and demand, thereby contributing to grid stability.
Industry analysts anticipate a rise in demand for electricity partnerships between producers and industrial firms in the coming years. According to a study conducted by the German Energy Agency (Dena), the volume of PPAs in Germany could reach 192 terawatt hours by 2030, encompassing a quarter of the nation’s total electricity demand.
A secure, competitive, and environmentally friendly energy supply plays a crucial role, particularly for Germany’s energy-intensive chemical industry. Concurrently, this sector produces numerous products essential for realizing the vision of the energy transition.
