This site uses cookies. By continuing to use this site you agree to our use of cookies. To find out more, see our Privacy and Cookies policy.
Skip to the content

[IOP] A community website from IOP Publishing

environmentalresearchweb blog

Germany’s Energiewende keeps going

By Dave Elliott

Germany is still powering ahead, with renewables supplying over 32% of annual electricity needs and hoping to get to 80% by 2050, with the last nuclear plant phased out by 2022. The nation’s 106GW of renewables briefly supplied 87% of its electricity at one point recently. However, it’s not all plain sailing. Certainly there have been plenty of critical views on its ambitious Energiewende transition programme, some predicting its demise. And, worried about the cost, with an election looming, the government has been slowing it all down. So what lies ahead?

Although the overall goal remains the same, the government has certainly been slowing things down. And there are some practical deployment problems, which have been seized on by opponents. A recent review for Energy Matters by Roger Andrews says Public opposition is delaying the construction of the power lines that are needed to distribute Germany’s renewables generation efficiently. Renewables investment has fallen to levels insufficient to build enough new capacity to meet Germany’s 2020 emissions reduction target. There is no evidence that renewables are having a detectable impact on Germany’s emissions, which have not decreased since 2009 despite a doubling of renewables penetration in the electricity sector. It now seems certain that Germany will miss its 2020 emissions reduction target, quite possibly by a wide margin. In short, the Energiewende is starting to unravel’.

The reality seems to be a bit more complex. In brief, FiT support for renewables has reduced wholesales prices (since less fossil fuel is used), but not yet reduced retail prices, with the cost of the FiT for PV actually pushing them up. That has produced a political backlash, a switch away from FiTs to market competition/project auctions and capacity caps on annual wind and PV expansion. For example, a 500MW p.a. cap on offshore wind growth in 2021and 2022 was set by the recently passed Renewable Energy Act 2017. Offshore wind is, or was, seen as one of Germany’s key new areas for expansion.

So the main reason why, as Energy Matters notes, the ‘investment levels have fallen’ is because, for good or ill, it’s a conscious slow-down policy choice. It will have impacts, for example on emissions, but here views of the reality seem to differ. Total emissions did go up in 2012 and 2013 (as the nuclear phase-out started), but in 2014 they went down, those from energy production especially, despite continued use of coal, which it seems is mainly being retained for lucrative export of power.   The 1.1% rise in total emissions in 2015 seems mainly to have been from heat and transport fuels, not from national power supply via coal use. And there was also an increase in 2016, though only 0.7%. Again it seems due mainly to increased transport demand.

The new slow-down policy for green power, the continued use of coal and resistance to some new grid links could, however, add to the emission rise. It’s not good news. But it’s a choice. It has been driven ostensibly by worries about the cost of the green policies to consumers, although that seems to have stabilised. The new policy should maintain that, although it may also undermine or slow the longer-term process of price reduction by deployment of lower cost renewables and efficient energy management. It may also legitimize the views of the minority who are hostile to the whole thing. And that could lead to local problems. For example, some of Germany’s 47GW of onshore wind is locally owned, but most isn’t and that can lead to resentments.

The grid issue is urgent. The offshore wind resource is in the north, as is most of the onshore wind resource, whereas much of the demand is in the south. Solar is more widely distributed and well matched to daytime peak loads, and local PV storage can help reduce the need for invasive and costly north-south transmission. However, despite PV having nearly as much installed generation capacity (41GW or so in 2016)  as onshore wind (47GW), its actual annual energy contribution (around 7% of German electricity) is lower than that from wind (about 16%), mainly given the much lower annual load factors for PV (10-15%) compared to wind (30-40%) and possibly more offshore, which is expanding quite fast – to maybe 5GW soon.

So, if the national renewable targets are to be met, new grid links will still be needed to support the development of as much wind capacity as possible and to avoid the current temporary expedient of routing some power via next-door countries, some of whom are none too happy with this disruptive use of their grids. Despite sometimes bitter local objections, the new north-south HVDC supergrid does seem to be going ahead, with some parts being put underground, although that will push up the cost. In parallel, attention to local smart grid demand management is ramping up to provide balancing, and reduce the need for so much long-distance transmission. Though much more will be needed as renewables expand, including more large-scale energy storage to reduce curtailment of surpluses. There are some big projects proposed, for example, this hydropower battery in a former German coal mine.

On the positive side, costs continue to fall, with onshore wind contract tender prices ranging between €52 and 58/MWh, down from €80/MWh under the FiT system. A total of 65 of the 70 successful projects were community-driven or co-operative schemes. And offshore wind project have been getting contracts with an average subsidy of €4.4/MWh.  For comparison, under the FiT, roof top PV solar has been getting around €120/MWh, free standing units €60-70/MWh.

Clearly there are still hefty subsidies needed in some cases, and there are challenges ahead: no one said the transition would be easy, technically, economically or politically. However, it’s hurting some more than others. The big German energy utilities are losing money, as renewables squeeze them out of key markets e.g. PV is dominating during peak daytime demand and that means the utilities’ profits are being hit.

Perhaps that’s what is behind some of the negative views on the Energiewende. The utilities will also be less than pleased with the rise of self-generating ‘prosumers’ and local energy co-ops: there are around 1000 co-ops so far. Together, the farmers and the prosumers currently own about 40% of Germany’s renewable capacity and are challenging the utilities’ market power. The cuts may slow progress, but hopefully they won’t halt it – the momentum forward seems to be too well established. Certainly most think that the Energiewende programme will survive.

Similar problems have emerged elsewhere in the EU – see my next post. When hit by the recession, France cut its FiT, while Spain cut almost all its support for renewables, some even retrospectively. Portugal is now going to phase its support out, but more slowly. The UK has already cut back on support of onshore wind and PV and is planning some cuts for biomass. Some of these policy shifts have been too fast and will be disruptive, but some are due to the fact that some renewables are now competitive and don’t need subsidies, although that means they have to compete with rivals that still have subsidies, like (in the UK and US) nuclear.  The battle continues around the world… 


 

This entry was posted in Renew your energy and tagged , , , . Bookmark the permalink.
View all posts by this author 

Leave a comment

Your e-mail address will not be published.

Guidelines

  • Comments should be relevant to the article and not be used to promote your own work, products or services.
  • Please keep your comments brief (we recommend a maximum of 250 words).
  • We reserve the right to remove excessively long, inappropriate or offensive entries.

Show/hide formatting guidelines

Tag Description Example Output
<a> Hyperlink <a href="http://www.google.com">google</a> google
<abbr> Abbreviation <abbr title="World Health Organisation" >WHO</abbr> WHO
<acronym> Acronym <acronym title="as soon as possible">ASAP</acronym> ASAP
<b> Bold <b>Some text</b> Some text
<blockquote> Quoted from another source <blockquote cite="http://iop.org/">IOP</blockquote>
IOP
<cite> Cite <cite>Diagram 1</cite> Diagram 1
<del> Deleted text From this line<del datetime="2012-12-17"> this text was deleted</del> From this line this text was deleted
<em> Emphasized text In this line<em> this text was emphasised</em> In this line this text was emphasised
<i> Italic <i>Some text</i> Some text
<q> Quotation WWF goal is to build a future <q cite="http://www.worldwildlife.org/who/index.html">
where people live in harmony with nature and animals</q>
WWF goal is to build a future
where people live in harmony with nature and animals
<strike> Strike text <strike>Some text</strike> Some text
<strong> Stronger emphasis of text <strong>Some text</strong> Some text