Tesla has faced its share of challenges with the building of Gigafactory Berlin. The local utilities temporarily turned off its water over an unpaid bill, which may have been one factor in its subsequent replacement of the factory manager with a former Mercedes-Benz manager in a move that reportedly annoyed a German automaker’s union. Environmentalist groups won a partial legal victory in German courts over an allegedly incomplete plan to mitigate the environmental impact of the Gigafactory’s construction.
Now Tesla is expressing annoyance with bureaucratic red tape related to the Gigafactory’s grand opening, which is currently scheduled for July 1. The environmental groups’ legal challenge appears to be causing a large part of the delay. The court ordered Tesla to stop the clearing of trees, which could have an impact on hibernating snakes.
Tesla said in a letter to the court, “The German approval framework for industrial and infrastructure projects as well as spatial planning directly contradicts the urgency to plan and realize such projects that is necessary to battle climate change.”
Tesla plans to produce the electric Model Y SUV at Gigafactory Berlin. Elon Musk had previously asserted that innovations in electric vehicles, plus a regulatory environment that is friendly toward businesses that manufacture them, could help to render gasoline-powered vehicles obsolete. He has backed up his opinion on the importance of innovation with the introduction of a more efficient battery-making process at the company’s Battery Day event last year. Tesla has also pursued the purchase of stakes in manufacturers of batteries for vehicles, including the acquisition of a German battery assembly company named German ATW Automation and discussion of the purchase of a 10% stake in LG Energy Solution.
His opinion on regulation has previously led to disputes with government entities, including a scrap with Californian state and county officials over the temporary closing of the Gigafactory in Pasadena as part of the response to COVID-19. The fight led to Musk moving from California to Texas, citing what he calls an increasingly unfriendly attitude toward technology companies in the state.
Tesla’s current frustration with German regulators includes the fact that there is still no news on the application for final approval of Gigafactory Berlin that it filed 16 months ago. In a letter dated April 7, the company urged regulators to speed that up to provide more certainty for investors who have placed their money on new climate-friendly technologies.
This is not an issue that is unique to Tesla. Other climate-friendly industries such as wind farms have reported difficulty in gaining regulatory approval in Germany. Many wind energy projects in Germany have taken several years from application to completion, with regulatory approval being the primary cause of delay.
The pattern of delays could be interpreted as an undercurrent of unfriendliness toward private efforts to advance the fight against climate change among Germany’s bureaucrats. Tesla can stay ahead of the curve well enough to have sold $1.58 billion in carbon credits last year despite its complaint that delays in Obama-era environmental regulations hurt the carbon credit market. That could be interpreted as meaning that government bureaucrats working for agencies tasked with combatting climate change are only good for companies that make the upfront investment for “green” technologies that exceed regulatory standards and can, therefore, earn a residual income through the sale of carbon credits.
So it may be possible that German regulators are stalling with the final approval of Gigafactory Berlin out of resentment for that implication. If and when the Gigafactory is finally approved, it can start cranking out an electric alternative to gas-guzzling SUVs to reduce Europe’s reliance on gasoline.