As a result of the World Economic Crisis, the German economy suffers from a drastic drop in production and slump in sales. Nevertheless RWE’s sales of electricity only drop from 2.7 million kWh (1929/30) to 2.1 million kWh (1931/32). One factor: Many industrial manufacturers shutdown their own unprofitable power stations previously operating only to cover their own electricity demand.
However, a similar slump in sales hits VEW hard. The young, still developing company is on the verge of economic collapse.
RWE acquires from steel industrialists Fritz Thyssen and Friedrich Flick the controlling stake in the largest Rhenish lignite producer, RAG, the ‘Rheinische AG für Braunkohlenbergbau und Brikettfabrikation’, in Cologne.
Besides numerous opencast mines and briquette factories, the company also owns two large lignite-fired power plants, Fortuna I + II, which supply Cologne and other cities. RAG is to become the core of the future ‘Rheinische Braunkohlenwerke AG’ or shortened ‘Rheinbraun’.
Seizure of power by the National Socialists. Although management and especially the Executive Board remain in office, National Socialist mandate holders obtain seats on RWE’s supervisory board held by regional administrative bodies (local authorities, provinces). Both works council representatives are forced to leave the supervisory board. The National Socialists have an especially strong influence on the purely public utilities VEW and WFG. Active National Socialists now move into company management.
Forecasts that the reserves in the Rhenish lignite mines will drain in the medium term prompt RWE to make greater use of hydroelectric power: On the Upper Rhine, the run-of-river station belonging to RADAG, the Rheinkraftwerk Albbruck-Dogern AG, in Waldshut/Baden (founded in 1930 with Swiss participation, RWE's stake 75 per cent) goes into operation; in 1935, the Klingnau Power Plant, owned by Swiss ‘Aarewerke’ AG, Aarau, feeds electricity into the RWE grid for the first time. Over the course of the following ten years, RWE further expands its production of electricity from the ‘white coal’ by enlarging existing plants and through new equity holdings.
The Electricity Industry Act temporarily puts an end to the decades-old debate about the structure and legal framework of Germany's electricity producing industry. Over the past few years there have been frequent media confrontations between RWE and individual NSDAP groups. For military and other reasons, these groups reject large power plants and a national interconnected grid system and are instead demanding a piecemeal supply structure based on self-sufficiency and a large number of small power plants.
Although the new act does not intervene in the structure and the ownership rights of the German electricity industry, it does for the first time secure state influence over planning, operation and pricing in the power industry.
RWE acquires a further important Rhenish lignite producer in the shape of the ‘Niederrheinische Braunkohlenwerke AG’ in Rheydt, which operates the Frimmersdorf Power Plant.
The stake held since 1926 in utility Rheinische Elektrizitäts-Aktiengesellschaft (Rheinelektra), in Mannheim, is increased to a majority interest. Besides numerous power plants, Rheinelektra also holds a stake in Stierlen-Werke AG, Rastatt. This company, founded in 1889 as a manufacturer of ovens, now also produces hospital equipment under the brand name ‘Maquet’, in addition to high-speed scales, cold-storage plants and dishwashing systems. The RWE Group's subsequent Mechanical and Plant Engineering Division has one of its roots in this company.
The industrial recovery brought about by rearmament leads to a major increase in the demand for power, which RWE is initially only able to satisfy by operating at full capacity. The 1936 ‘Four Year Plan’, which is intended to make Germany self-sufficient in raw materials (oil and rubber, for example), makes it necessary for RWE to expand its existing power plants and build new ones. To the north of Essen, construction starts on the Karnap hard coal-fired power station, which goes on line in 1940. VEW adds new high-pressure facilities to its power stations in Dortmund and Gersteinwerk near Werne.
The Rhenish lignite companies also have to make their contribution to the country's self-sufficient economy: In 1937 they found the ‘Union Rheinische Kraftstoff AG’, Wesseling, which in 1941 begins operation of a hydrogenation plant for the production of gasoline from lignite south of Cologne.
RWE subsidiary Rheinelektra acquires a majority interest in one of Germany's most tradition-steeped mechanical engineering companies, the ‘Schnellpressen AG’, Heidelberg, which was founded in 1850. With its ‘Heidelberg Tiegel’, a platen press which was manufactured from 1914 until 1985, and the first fully automatic sheet-feed printing press, the company enjoys worldwide success. During the post-war era, Heidelberg will become the world's largest manufacturer of printing presses.
Given the war-time economy's enormous demand for electricity and the start of bombing raids on individual power plants, RWE seeks to integrate the power-generating industry of occupied Western Europe into the German interconnected grid system. High-tension links to Belgium, the Netherlands and France are intended to tap into unused power plant capacity for use by Germany, although some of these links are not completed until after the end of the war. Ironically, it is through these lines that the electricity surrendered as reparations flows into the neighbouring countries of western Europe beginning in 1945. Ultimately, they will form the links for the post-war European interconnected grid system.
The increase in the number of air raids hits RWE and VEW hard. Many power stations (such as the Goldenberg and the Dortmund power station) suffer severe partial damage and head offices in both Essen and Dortmund are destroyed. RWE staff are accommodated in offices in the Hochtief house in the Rellinghauser road. These temporary offices remain in use for the next 17 years.
Shortly before the end of the war, the RWE interconnected grid collapses, and the contractually secured electricity supplies from Switzerland cease. Often enough, RWE staff intervene at the last moment to prevent plants from being destroyed by retreating German troops. Former senior executives Heinrich Schöller and Fritz Ridderbusch form the first post-war RWE board of management. Together they will have a decisive influence on corporate policy until the end of the following decade. During the course of the year, RWE's foreign holdings are frozen and its hard coal and lignite producing companies placed under Allied control. In contrast, the Western occupying powers support the speedy reconstruction of electrical supply: By 1948, RWE's entire high-tension network is once again operational.