{"id":301682,"date":"2024-02-13T19:54:41","date_gmt":"2024-02-13T18:54:41","guid":{"rendered":"https:\/\/climatescience.press\/?p=301682"},"modified":"2024-02-13T19:54:43","modified_gmt":"2024-02-13T18:54:43","slug":"the-deindustrialization-of-europe-in-five-charts","status":"publish","type":"post","link":"https:\/\/climatescience.press\/?p=301682","title":{"rendered":"The Deindustrialization of Europe in Five Charts"},"content":{"rendered":"\n
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From Watts Up With That?<\/a><\/p>\n\n\n\n

By Robert Bryce Substack<\/a><\/p>\n\n\n\n

Robert Bryce<\/p>\n\n\n\n

Industrial electricity use in the EU is collapsing. US policymakers “Have no excuse for not looking at Europe and learning.” Plus: screenings in Dallas, Tulsa, Fairfax, & Austin.<\/em><\/strong><\/p>\n\n\n\n

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Port Talbot steelworks in Port Talbot, Britain.<\/strong>\u00a0https:\/\/en.wikipedia.org\/wiki\/Tata_Steel_Europe#\/media\/File:Port_talbot_large.jpg<\/figcaption><\/figure>\n\n\n\n

The headline on a February 9 Bloomberg article concisely sums up Europe\u2019s unfolding disaster: \u201cGermany\u2019s days as an industrial superpower are coming to an end<\/a>.\u201d The article says, \u201cManufacturing output in Europe\u2019s biggest economy has been trending downward since 2017, and the decline is accelerating as competitiveness erodes.\u201d<\/p>\n\n\n\n

Germany is once again, the \u201csick man of Europe.<\/a>\u201d <\/em><\/strong><\/p>\n\n\n\n

But it\u2019s not just Germany. All across Europe, industrial capacity is shrinking. Last month, Tata Steel announced it would close its last two blast furnaces in Britain by the end of this year, a move that will result \u201cin the\u00a0loss of up to 2,800 jobs at its Port Talbot steelworks in Wales<\/a>.\u201d<\/p>\n\n\n\n

In January 2023, Slovalco announced it was permanently closing its aluminum smelters in Slovakia<\/a> after 70 years of operation. The company, Slovakia\u2019s biggest electricity consumer, said it was shuttering its smelters due to high power costs.<\/p>\n\n\n\n

Europe drove itself into the ditch. Bad policy decisions, including net-zero delusions, the headlong rush to alt-energy, aggressive decarbonization mandates, and the strategic blunder of relying on Russian natural gas that\u2019s no longer available, are driving the deindustrialization. How bad is it? Mario Loyola, a research fellow at the Heritage Foundation, wrote a sharp January 28 article in <\/a>The Hill<\/a><\/em> about Europe\u2019s meltdown. According to European Commission data, industrial output in Europe \u201cplummeted 5.8% in the 12 months ending November 2023,\u201d he wrote. \u201cCapital goods production was down nearly 8.7%. Investment in plants and equipment has plummeted.\u201d<\/p>\n\n\n\n

The result of all that lousy policy: staggering increases in electricity prices. Loyola notes that European electricity prices \u201chave settled at triple their pre-pandemic levels.\u201d Energy analyst Rupert Darwall recently reported that large businesses in Britain now pay up to five times more for juice than in 2004<\/a>.<\/p>\n\n\n\n

Electricity use is one of the most reliable barometers of economic vitality. Indeed, electricity is the world\u2019s most important and fastest-growing form of energy. Economic growth drives electricity use and vice versa. Healthy economies need juice and lots of it. In ailing economies, electricity use declines. Last year, according to a new report from the International Energy Agency<\/a>, global power demand grew by 2.2%. The Paris-based agency expects global electricity demand to rise by an average of 3.4% annually through 2026, and that \u201cdemand will be driven by an improving economic outlook, which will contribute to faster electricity growth both in advanced and emerging economies.\u201d<\/p>\n\n\n\n

China and India continue their torrid growth. The IEA estimates China\u2019s electricity demand grew by a whopping 6.4% in 2023. The agency expects China\u2019s power demand to increase by 1,400 terawatt-hours through 2026, an amount of energy that \u201cis more than half of the EU current annual electricity consumption.\u201d Power demand in India jumped by 7% in 2023, a slight decrease from the 8.6% growth in 2022. The IEA said, \u201cContinued rapid economic expansion and robust demand for space cooling were the main pillars of growth\u201d in India. And as I noted in these pages in December<\/a>, the bulk of new power demand in China and India is being met by burning coal. (Power demand in the U.S. fell by 1.6% last year, a reduction the IEA blamed on milder weather, reduced manufacturing, and \u201cstrikes in the automotive industry and overall inflationary pressures.\u201d)<\/p>\n\n\n\n

The soaring growth in China and India provides a stark contrast to the situation in Europe, where electricity use declined by 3.2% last year. The IEA notes the drop in electricity use follows a 3.1% decline in 2022 and that power demand in the EU has \u201cdropped to levels last seen two decades ago. As in 2022, weaker consumption in the industrial sector was the main factor that reduced electricity demand.\u201d The plunge in the EU\u2019s industrial electricity use is nothing short of stunning. In 2022, industrial power demand in the EU dropped by 5.8%. The IEA estimates it declined by another 6% in 2023.<\/p>\n\n\n\n

The deindustrialization of Europe and the IEA report are top of mind this week as I prepare slides for my keynote speech at the National Association of Regulatory Utility Commissioners meeting<\/a> in Washington, D.C., on February 26. These five charts illustrate the deindustrialization of Europe and why it will likely continue.<\/p>\n\n\n\n

Figure 1<\/h4>\n\n\n\n

According to the IEA, electricity demand in Germany \u201cdeclined by a remarkable 4.8% in 2023\u2026demand reduction is especially prominent in energy-intensive industry, which faced a decrease in production of 13% during the first six months of 2023.\u201d That reduction in electricity use reflects the ongoing drop in Germany\u2019s industrial output. This (somewhat fuzzy) chart uses a screen grab from the Bloomberg report<\/a> mentioned at the top of this article.<\/p>\n\n\n\n

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Figure 2<\/em><\/strong><\/p>\n\n\n\n

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Figure 3<\/em><\/strong><\/p>\n\n\n\n

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Figure 4<\/em><\/strong><\/p>\n\n\n\n

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Figure 5<\/em><\/strong><\/p>\n\n\n\n

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These slides and the ongoing destruction of European heavy industry bring to mind the trenchant lines that John Constable of Britain\u2019s Renewable Energy Foundation delivers in our new five-part docuseries,\u00a0Juice: Power, Politics & The Grid.<\/a><\/em><\/p>\n\n\n\n

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Constable, who is also the energy editor at the Global Warming Policy Foundation<\/a>, delivers a stark warning. In Episode 3<\/a>, he says, \u201cI tell decision-makers in the United States to study the European example very, very carefully. I mean, you have no excuse for not looking at Europe and learning. We\u2019ve tested this for you.\u201d<\/p>\n\n\n\n

Subscribe<\/a><\/p>\n\n\n\n

Upcoming Screenings: Dallas, Tulsa, Gray Horse, Austin<\/h2>\n\n\n\n

We are taking Juice<\/a><\/em> on the road. We have several screenings in the works. The screenings are free, but seating is limited. If you want to attend, please RSVP<\/strong> by sending a note to: hello.robertbryce (at) gmail.com. Let us know which screening you wish to attend.<\/p>\n\n\n\n