German glass bottle producer Heinz-Glas is heavily dependent on gas. The age-old industry now faces a potential shutdown as the country scrambles to ration reserves in a bid to survive the winter months.
ADVERTISEMENTHeinz-Glas is one of Germany's biggest glass bottle manufacturers and produces perfume bottles for illustrious brands such as Gucci and L'Oréal.
While the industry has weathered many storms, the current gas crisis rocking the country could prove fatal.
At the Bavarian plant, almost 70 tonnes of glass are made every day, at temperatures of up to 1,600 degrees.
Massive amounts of gas are used, which has become an endangered and increasingly expensive resource.
The rise in energy costs is driving up production costs as Vice President Murat Agac explains.
"Since the invasion of Ukraine, some gas and energy prices have risen tenfold compared to 2019 while other costs are even 20 times the price they were.
"So, prices are volatile, but basically, they are way too high and it's hardly economically sustainable anymore."
If Russian gas suppliers were to turn off the taps, the move would prove disastrous for the industry that produces a million of these bottles daily in Germany alone. The furnaces would be forced to a standstill and could be permanently damaged. A restart would take months and could serve as the final blow.
"In the event of a sudden gas shutdown, we would have no choice but to empty the glass melting tanks in a controlled manner and hope that nothing breaks," says Agac.
"However, the construction of a new melting tank would if technically feasible, take at least 12 months and possibly 18 months or more. This means that the glass industry in Germany could very likely disappear."
Hope in renewable energy
However, the plant is hoping to switch to renewable forms of energy.
"We have two plants in Germany: our plant in Kleintettau is already electrified, the melting pots are electrified, but not the rest of the structure," says Agac.
However, around 40 per cent of the industrial processes at the Kleintettau factory still require gas.
"We are planning to switch from gas to electrified tanks and would then adapt the entire infrastructure accordingly," says Agac.
The company has invested in tanks of liquefied gas, which could be delivered daily by truck. But this would cost three times as much and would not be sufficient. The industry desperately requires investors.
"In our case, we are talking about €50 million. We can't do this on our own, it's not possible," notes Agac.
"We need state support" he warns, otherwise the firm may be forced to shift production elsewhere, such as India or China, where it already has a factory.
For the 1,500 employees of the company in Germany, the future looks cloudy. But for now, the management remains optimistic that Heinz-Glas can pull through.
ADVERTISEMENTSince 1622, "there have been enough crises in the 20th century alone. World War I, World War II, the oil crisis in the 70s, many, many critical situations. We survived them all," says Agac.
"We will somehow also overcome this crisis," he concludes.
