BMW looking to make energy investments to reduce dependence on natural gas

BMW is exploring new investments in solar, geothermal and hydrogen energy so that it can lower its dependence on natural gas, the carmaker's production chief told Reuters, warning an embargo on Russian gas would bring the industry to a standstill. The carmaker relied on natural gas for 54% of its energy consumption in 2021, but is now examining where it can add solar panels to its plants.

BMW is also working on developing plans with local authorities to transport hydrogen to its plant in Leipzig, Germany. "Hydrogen is very well-suited to lower or even fully compensate for gas demand," Milan Nedeljkovic, Member of the Board of Management of BMW AG, Production, said.

When asked what would happen to BMW's plants in the event of a halt to gas deliveries from Russia, he said, "Not just BMW but the entire sector would come to a standstill. Our industry accounts for around 37% of German natural gas consumption."

BMW's move reflects wider preparations underway across German industry to shift away from Russian gas and come up with a system to ration available supplies in the event of a sudden halt to deliveries. BMW's new plant in Debrecen, Hungary, will be the world's first auto factory to run entirely without fossil fuels. It will rely heavily on solar and carmaker is also looking into using geothermal energy.

When asked about the potential of nuclear energy, which accounts for around half of Hungary's energy supply but is being phased out in Germany, Nedeljkovic said, "Nuclear energy can be a stabilising factor, particularly in these volatile times. For our own production we rely on regenerative energy sources."

(with inputs from Reuters)