The ‘energy crisis is solved’ and the German economy is safe, Bundesbank’s Nagel says
The headquarters of the European Central Bank (ECB) pictured on February 03, 2022 in Frankfurt, Germany.
Thomas Lohnes | Getty Images News | Getty Images
Germany’s energy worries are over and Europe’s largest economy has the “inherent strength” to recover from the dual shocks of the pandemic and the war in Ukraine, according to Bundesbank President Joachim Nagel.
The International Monetary Fund on Tuesday projected the German GDP will contract by 0.1% in 2023, becoming the second worst performer among major economies behind the U.K., before expanding by 1.1% in 2024.
Central to concerns about the economic outlook for Germany and the wider continent over the past year has been the potential for an energy crisis, as Europe strives to curb its reliance on Russian gas following Moscow’s full-scale invasion of Ukraine.
German output decreased by 0.4% in the fourth quarter and is expected to contract again in the first quarter of 2023, entering a technical recession.
Nagel told CNBC on the sidelines of the IMF Spring Meetings that he is “more positive than the IMF” and does not see a recession this year.
“The German economy proved a lot over the past couple of weeks and months, so the adaptation capacity of the German industry is pretty high, the energy crisis is more or less solved. So we had a really worried situation in the past, but this is now over, and the outlook is good,” he told CNBC’s Joumanna Bercetche.
He asserted that Germany’s progress in diversifying its liquefied natural gas supply away from Russia, and its increased storage — resulting from built up capacity during the mild winter — meant the country’s economy is well placed to weather the next cold season as well.
The latest available purchasing managers’ index readings showed German manufacturing, which accounts for around a fifth of the country’s economy, experienced its sharpest fall in activity for almost three years in March and hit its lowest level since May 2020.
However, Nagel claimed that this was down to lingering effects of the Covid-19 pandemic and Russia’s war in Ukraine, insisting that “we shouldn’t forget where we came from.”
“The German industry has a good capability to deal with the situation, there is this inherent strength of the German economy, and I believe they will overcome this, and they will go back to the levels we saw before the pandemic,” he said.
Sticky core inflation
The European Central Bank hiked interest rates by another 50 basis points in March to bring its main rate to 3%, as the continent continues to grapple with high inflation.
Headline inflation across the euro zone fell to 6.9% in March from 8.5% in February, driven by cooling energy costs. But core inflation — which strips away volatile food, energy, alcohol and tobacco prices — increased to an all-time high of 5.7%.
Nagel said the persistence of high core inflation showed the ECB Governing Council, in which he is considered one of the more hawkish members, has further to go in tightening monetary policy.
He expects core inflation to eventually follow the headline figure downwards, but reiterated that policymakers have to “stay really alerted when it comes to the inflation story.”
“What is also important to me, we went through some financial market turbulence uncertainty over the last five weeks and now we have to find out what was the impact out of that, and we have to wait for the incoming data until we have our next meeting in May, and then we will see,” he said.
German banking ‘very robust’
Financial markets were roiled in March by concerns about the banking sector. The collapse of U.S.-based Silicon Valley Bank early last month triggered contagion fears that eventually took down several U.S. regional lenders and led to the emergency rescue of Credit Suisse by fellow Swiss giant UBS.
The ECB went ahead with a 50 basis point hike to interest rates despite concerns about the economic impact of the banking turmoil, and Nagel hopes this sent an important message to markets.
“There is no contradiction between what we have to do on the price stability side and on the financial stability side,” he said.
“We have different instruments to tackle the price issues and the financial stability issues, so it was an important message to the financial market participants that we are very committed when it comes to fighting against inflation.”
Deutsche Bank shares sold off sharply over a few days in March after a sudden spike in the cost of insuring against its default. Analysts largely attributed this to misplaced market panic, but also to concerns about the German lender’s well-documented exposure to commercial real estate, which is considered a particularly weak link in the U.S. economy.
Nagel insisted the German banking system is safe and sound.
“I think we have to be vigilant when it comes for example to the commercial banking sector, but let me take this opportunity to say something about the German banking sector — I think the German banking sector is very robust,” he said.
“I think, compared to 15 years ago, they are much better capitalized, better liquidity situation, so I do not have doubts.”
Although he reaffirmed the ECB’s commitment to fighting inflation, Nagel acknowledged that policymakers “have to be cautious” and keep an eye on parts of the economy that may be affected if rates continue to rise.
In a bold bid to combat the crippling air pollution crisis in its capital, Delhi, Indian lawmakers have begun high-level discussions about a plan to phase out gas and diesel combustion vehicles by 2035 – a move that could cause a seismic shift in the global EV space and provide a cleaner, greener future for India’s capital.
Long considered one of the world’s most polluted capital cities, Indian capital Delhi is taking drastic steps to cut back pollution with a gas and diesel engine ban coming soon – but they want results faster than that. As such, Delhi is starting with a city-wide ban on refueling vehicles more than 15 years old, and it went into effect earlier this week. (!)
“We are installing gadgets at petrol pumps which will identify vehicles older than 15 years, and no fuel will be provided to them,” said Delhi Environment Minister Manjinder Singh Sirsa … but they’re not stopping there. “Additionally, we will intensify scrutiny of heavy vehicles entering Delhi to ensure they meet prescribed environmental standards before being allowed entry.”
Making it prohibitively difficult for Dehli’s residents to own and operate older, presumably more polluting vehicles is one way to reduce harmful emissions and air pollution, but Sirsa’s team isn’t just targeting newer vehicles. They’re also planning to deploy more than 900 electric transit buses, part of a larger plan to replace 5,000 of the city’s 7,500 total bus with lower- or zero-emission options this year alone.
The Economic Times is reporting that discussions are underway to pass laws requiring that all future bus purchases will be required to be electric or “clean fuel” (read: CNG or hydrogen) by the end of this year, with a gas/diesel ban on “three-wheelers and light goods vehicles,” (commercial tuk-tuks and delivery mopeds) potentially coming 2026 to 2027 and a similar ban privately owned and operated cars and bikes coming “between 2030 and 2035.”
Electrek’s Take
After a Chinese government study linked air pollution caused by automotive exhausts and coal-fired power plants to more than 1.1 million deaths per year in 2013, the nation’s government took serious action, shuttering older coal plants and imposing strict emissions standards. The country also incentivized EV adoption through license-plate lotteries favoring electric cars and a nationwide EV mandate set to kick in by 2030.
The results were astounding, and the technological innovations that have come from an entire nation of talented engineers all “pulling in the same direction” have put the West to shame, with Western auto executives repeatedly sounding the alarm and lobbying for tariffs and other protectionist policies on both sides of the Atlantic.
To see India make move towards a gas and diesel ban like this, and on such an aggressive timeline, can only mean that they’ve been paying attention … and America is about to fall even further behind.
SOURCE: India Times; featured image by Sumita Roy Dutta.
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Last week, Parker Hannifin launched what they’re calling the industry’s first certified Mobile Electrification Technology Center to train mobile equipment technicians make the transition from conventional diesel engines to modern electric motors.
The electrification of mobile equipment is opening new doors for construction and engineering companies working in indoor, environmentally sensitive, or noise-regulated urban environments – but it also poses a new set of challenges that, while they mirror some of the challenges internal combustion faced a century ago, aren’t yet fully solved. These go beyond just getting energy to the equipment assets’ batteries, and include the integration of hydraulic implements, electronic controls, and the myriad of upfit accessories that have been developed over the last five decades to operate on 12V power.
At the same time, manufacturers and dealers have to ensure the safety of their technicians, which includes providing comprehensive training on the intricacies of high-voltage electric vehicle repair and maintenance – and that’s where Parker’s new mobile equipment training program comes in, helping to accelerate the shift to EVs.
“We are excited to partner with these outstanding distributors at a higher level. Their commitment to designing innovative mobile electrification systems aligns perfectly with our vision to empower machine manufacturers in reducing their environmental footprint while enhancing operational efficiency,” explains Mark Schoessler, VP of sales for Parker’s Motion Systems Group. “Their expertise in designing mobile electrification systems and their capability to deliver integrated solutions will help to maximize the impact of Parker’s expanding METC network.”
The manufacturing equipment experts at Nott Company were among the first to go through the Parker Hannifin training program, certifying their technicians on Parker’s electric motors, drives, coolers, controllers and control systems.
“We are proud to be recognized for our unwavering dedication to advancing mobile electrification technologies and delivering cutting-edge solutions,” says Nott CEO, Markus Rauchhaus. “This milestone would not have been possible without our incredible partners, customers and the team at Nott Company.”
In addition to Nott, two other North American distributors (Depatie Fluid Power in Portage, Michigan, and Hydradyne in Fort Worth, Texas) have completed the Parker certification.
Electrek’s Take
With the rise of electric equipment assets like Bobcat’s T7X compact track loader and E10e electric excavator that eliminate traditional hydraulics and rely on high-voltage battery systems, specialized electrical systems training is becoming increasingly important. Seasoned, steady hands with decades of diesel and hydraulic systems experience are obsolete, and they’ll need to learn new skills to stay relevant.
Certification programs like Parker’s are working to bridge that skills gap, equipping technicians with the skills to maximize performance while mitigating risks associated with high-voltage systems. Here’s hoping more of these start popping up sooner than later.
SOURCE | IMAGES: Parker Hannifin.
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Based on a Peterbilt 579 commercial semi truck, the ReVolt EREV hybrid electric semi truck promises 40% better fuel economy and more than twice the torque of a conventional, diesel-powered semi. The concept has promise – and now, it has customers.
Austin, Texas-based ReVolt Motors scored its first win with specialist carrier Page Trucking, who’s rolling the dice on five of the Peterbilt 579-based hybrid big rigs — with another order for 15 more of the modified Petes waiting in the wings if the initial five work out.
The deal will see ReVolt’s “dual-power system” put to the test in real-world conditions, pairing its e-axles’ battery-electric torque with up to 1,200 miles of diesel-extended range.
ReVolt Motors team
The ReVolt team starts off with a Peterbilt, then removes the transmission and drive axle, replacing them with a large genhead and batteries. As the big Pete’s diesel engine runs (that’s right, kids – the engine stays in place), it creates electrical energy that’s stored in the trucks’ batteries. Those electrons then flow to the truck’s 670 hp e-axles, putting down a massive, 3500 lb-ft of Earth-moving torque to the ground at 0 rpm.
The result is an electrically-driven semi truck that works like a big BMW i3 or other EREV, and packs enough battery capacity to operate as a ZEV (sorry, ZET) in ports and urban clean zones. And, more importantly, allows over-the-road drivers to hotel for up to 34 hours without idling the engine or requiring a grid connection.
That ability to “hotel” in the cab is incredibly important, especially as the national shortage of semi truck parking continues to worsen and the number of goods shipped across America’s roads continues to increase.
And, because the ReVolt trucks can hotel without the noise and emissions of diesel or the loss of range of pure electric, they can immediately “plug in” to existing long-haul routes without the need to wait for a commercial truck charging infrastructure to materialize.
“Drivers should not have to choose between losing their longtime routes because of changing regulatory environments or losing the truck in which they have already made significant investments,” explains Gus Gardner, ReVolt founder and CEO. “American truckers want their trucks to reflect their identity, and our retrofit technology allows them to continue driving the trucks they love while still making a living.”
If all of that sounds familiar, it’s probably because you’ve heard of Hyliion.
Hyliion electric semi truck
Before it changed its focus to develop Carnot-cycle generators and gensets, Austin-based Hyliion built a number of EREV Peterbilts using the then-new 15L Cummins diesel as a generator and employing the same sort of battery and e-axle-arrangement as ReVolt.
In addition to being located in the same town and employing the same idea in the same Peterbilt 579 tractor, ReVolt even employs some of the same key players as Hyliion: both the company’s CTO, Chandra Patil, and its Director of Engineering, Blake Witchie, previously worked at Hyliion’s truck works.
Still, Hyliion made their choice when they shut down their truck business. ReVolt seems to have picked up the ball – and their first customer is eager to run with it.
“Our industry is undergoing a major transition, and fleet owners need practical solutions that make financial sense while reducing our environmental impact,” said Dan Titus, CEO of Page Trucking. “ReVolt’s hybrid drivetrain lowers our fuel costs, providing our drivers with a powerful and efficient truck, all without the need for expensive charging infrastructure or worrying about state compliance mandates. The reduced emissions also enable our customers to reduce their Scope 2 emissions.”
Page Trucking has a fleet of approximately 500 trucks in service, serving the agriculture, hazardous materials, and bulk commodities industries throughout Texas. And, if ReVolt’s EREV semis live up to their promise, expect them to operate a lot more than 20 of ’em.
SOURCES | IMAGES: ReVolt; via Power Progress, TTNews.
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