Inside CSL’s ‘robust’ plans to combat Russia’s energy freeze

Australia’s biggest health company, CSL, has robust strategies to protect its European plants against the threat of rolling blackouts.

CSL has plants in Switzerland, Germany, the Netherlands and UK. Picture: Tim Carrafa

CSL says it is monitoring the European energy crunch closely and is in contact with suppliers “almost on a daily basis” as it prepares for the possibility of rolling blackouts across the region.

Fears are growing that an energy crisis sparked by Russia’s invasion of Ukraine could shroud Europe in darkness in coming months as it enters winter. Moscow has cut natural gas supplies in retaliation to sanctions imposed on Vladimir Putin’s government.

NATO said leaks on the Nord Stream pipelines between Russia and Europe were the result of sabotage and that attacks on its members’ infrastructure would be met with a collective response.

But business from banks to manufacturers have been drafting contingency plans to prepare for potential blackouts.

Harvey Norman – which has stores in Slovenia, Croatia, Ireland and Northern Ireland – is yet to adopt such strategies, saying it so far hasn’t experienced “anything more than a hiccup”.

CSL, which operates factories and research and development centres across four countries, has been transitioning to renewable energy but is still reliant on gas. Its chief financial officer, Joy Linton, said she was confident CSL had sufficient mitigation strategies to combat a potential energy crunch.

“As part of our sustainability strategy, CSL has been transitioning our operations to renewable energy. Our sites in the UK and Switzerland almost exclusively use renewable energy for their electricity needs now,” she said.

“Having said that, CSL has been monitoring the European energy situation closely, particularly as it relates to energy supply for our Marburg site in Germany, which uses gas to produce steam for heating processes.

“The EU Gas Emergency framework prioritises companies providing critical, lifesaving therapies so we have some assurance through that. We also have robust contingency plans that can be put in place at relatively short notice, for example, switching to oil for steam production.”

CSL chief financial officer Joy Linton says the company is watching the situation closely. Picture: James Braund.

Ms Linton said CSL’s plans extended beyond its own needs across its operations in Germany, Switzerland, the Netherlands and UK, to its supply chain. “Our procurement teams are also in contact with suppliers almost on a daily basis to work out mitigation options should the energy crisis affect them,” Ms Linton said.

CSL’s sites in Liverpool, Bern in Switzerland and Marburg, a university town north of Frankfurt in central Germany, are its biggest energy consumers. It has spent €150m ($227m) on building its largest research and development site in Marburg, which will span 40,000 square metres, employ 500 staff and open fully later this year.

CSL chief medical officer, Bill Mezzanotte, said the new Marburg site would play a “critical role” in the company’s research and development strategy.

“The science and innovation taking place in Marburg and across the region will help us to shape CSL‘s future in a sustainable way, and we hope that it will drive further development of the region into a globally recognised innovation centre,” Dr Mezzanotte said.

CSL has been incorporating greener technology, including renewable energy, across its newer centres and is targeting a 40 per cent cut in emissions, based on the 2019-21 levels, by 2030.

Harvey Norman executive chairman Gerry Harvey said the company has been in regular talks with its European management about the energy situation.

“We were just talking about it yesterday at a meeting and Slovenia and Croatia haven’t got any problems at the moment. Ireland is fine and so is Northern Ireland,” Mr Harvey said. “We’ve asked all those questions (about potential blackouts) and we’re not looking at anything that’s more than a hiccup. If it does happen, we’ll worry about that at the time.

“But the first quarter is done, it’s gone fine. And we’re not looking as if there is a big problem happening because we talk to our people over there every day – ’tell us what do you see’,” Mr Harvey said.

NATO suspects sabotage created the leak on the Nord Stream 1 gas pipeline, in the Swedish economic zone in the Baltic Sea.

NATO has warned it would defend against attacks on its members’ infrastructure following four leaks in the Nord Stream and Nord Stream 2 pipelines.