Tag Archives: ahead

Keystone XL – we won! But the real battle lies ahead Updated for 2026

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So the Keystone XL bill failed to pass Congress. The Big Fail marks a huge success for groups who have been struggling to expose the KXL for the dirty policy it represents.

The actions taken on the day of the vote, including disrupting the Senate vote in the chamber and blocking Senators Bennet (D-Col.) and Carper (D-Del.) from leaving their offices, speak to the dedication and tirelessness of the movement to stop the pipeline.

So we can all go home now, right? We won!

The problem is that the bill will be back in January, and the congress we’re dealing with right now is very different from the one we’ll see ushered into office at the beginning of 2015.

Just because the lame-duck Congress voted against the bill (barely) with its Democratic Party majority does not mean that the Republicans will have any problem sweeping it through when they take the majority.

The Democratic Party’s vote does give Obama a mandate to veto the bill next year if and when it goes through, but the question remains as to whether or not he will use it.

In short, the Big Fail and ensuing celebrations from the Environmental NGOs looks suspiciously like a setup. It’s definitely not time to demobilize.

‘Claim no easy victories’

Rising Tide North America released a statement on their Facebook page going so far as to call the bill’s failure a “hollow victory”. While the Big Fail is vital, activists must stay vigilant, they stress.

“We’ve made the climate argument on this pipeline and won. We’ve made the environmental impact argument and won. We’ve even made the jobs argument on Keystone XL and won”, the group insists.

“The grassroots climate and environmental movements are obviously mobilized. Hopefully, next January becomes more about fighting Keystone XL in the streets, along the pipeline route and corporate offices than asking a political system rigged against us to smile upon our cause once more.”

As RTNA intimates, the KXL must be met through sincere and dedicated efforts at Indigenous solidarity with the Rosebud Sioux, who have called the KXL’s passage through the House an “act of war”, and others who are resisting not only the pipeline, but the tar sands as well.

This is not just a struggle to stop one pipeline; it is a struggle for the future of the Earth, and that means that the tar sands – the Earth’s largest and most toxic industrial project – must be shut down, and all pipelines extending from it thwarted.

What if the bill fails in January, through some miracle, and Canada exports the oil through Canada’s Atlantic coast? Would the NGOs declare victory, or would they stand with us in the streets?

As Amilcar Cabral wrote, “Claim no easy victories.”

Pipelines are not the end

The day of the vote, the New York Times gave the world a striking image of what pipelines and the future of what is called North America look like with a map of major oil spills from pipelines over just the last 20 years.

The grey silhouette of the US is splashed with dark circles along the Midwest and Gulf Coast. Of course these grey splashes look ominous, but do they give us an actual picture of the horror?

If we extend our view to catch a glimpse of Canada, contemplation on the horrors of the energy industry becomes totally unfathomable. The continued exploitation of tar sands in Alberta, Canada, is driving not only the worsening of climate change, but also the further destruction of the landbase.

No matter how many carbon credits are given out and swapped, no matter what techno-fixes are developed, when the land and water systems are destroyed, biodiversity is exterminated, and the web of life breaks down.

Yes, targeting the KXL pipeline is both functional and symbolic, and it has merit. But no, today’s decision in Washington does not signal the beginning of a new era-only an increment in the initial, legislative phase.

The Washington Post ran an article four days ago throwing into question whether or not this federal vote even matters, since the states maintain some degree of autonomy, and industry may find routes around politics.

In a telling incident, a Vice President of a major energy company got into a scuffle with the editor of EnviroNews on Monday while trying to take the latter’s camera, snorting out lines like, “I do whatever I want” and “fuck you!” This is the mentality not just of a person, but of a pampered industry used to getting its way.

While popular action has brought the pipeline to a screeching halt, the climate movement is far from packing up its gear and heading to Disneyland.

There is likely a long struggle ahead, and we need to prepare ourselves for what that’s going to look like-including the struggle not only against KXL, but also the numerous fossil fuel infrastructure routes moving out to the Pacific through the Cascadia bioregion, as well as the new gas infrastructure at Cove Point.

Mobilizing against climate change

At this point, the Peoples Climate March and its 300,000 participants appears to be a good start towards the kind of mass mobilization that we need. Earth Day of 1970 saw some 20 million people in the streets.

What if those are the paradigm-shifting numbers we need to see if we are going to take the future into our own hands and lead ourselves away from a more catastrophic failure than the Earth could ever manage?

Such movements are happening all over the world. Burkina Faso, Hong Kong, Guerrero – these are just a few places where populations are rising up, because capitalism will never be able to accomplish the goals that are necessary to secure the overcoming of exploitation and genocide.

Real victory would mean transforming the basis of society from fossil fuels and corporations to local, horizontal networks of community empowerment, recognizing treaty rights of Indigenous peoples, ending environmental racism.

This means abandoning the big money approach of the Gang Green – Sierra Club, World Wildlife Fund, and yes, even the ‘dynamic duo’ of Avaaz and 350.org.

It means building power on community level and spreading resources to those in dire need.

Cynical clickbait activism breeds cynical participation, while accumulating resources for dubious means generally focused around brand marketing and advertising makes the movement into its own worst enemy: a self-destructive and superficial PR complex mired in a corporate governance model.

Real victory will never come from Washington, it will come from Washington’s ultimate disarmament and disempowerment through the self-activity of people rising up together.

 

 

Alexander Reid Ross is a contributing moderator of the Earth First! Newswire, where this article was first published. He is the editor of Grabbing Back: Essays Against the Global Land Grab (AK Press 2014) and a contributor to Life During Wartime (AK Press 2013).

 




386961

Germany’s green power surges ahead – at a price that’s finally falling Updated for 2026

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Germany is well on its way towards having a predominantly green electricity supply.

The transition from nuclear and fossil-fuel electricity to using renewables is happening faster than anyone had anticipated. This is a success, but there is a downside: it is hugely expensive.

The energy transition is an explicit policy goal in Germany, having been made a priority project by the German chancellor, Angela Merkel.

It has four strands: reducing CO2 emissions, improving energy efficiency, promoting renewable energy and the gradual phase-out of nuclear power.

Nuclear phase-out is actually an old story that started in 2000 when the Schroeder administration first announced a 20-year timetable.

It was a bit of a ‘yes-no’ rollercoaster until the Fukushima incident, after which the decision in favour was final. This is widely supported by the German public, meaning that nuclear power is politically not an option at the moment.

Installed renewable capacity now equals demand

Yet without a doubt, the most significant development within the energy transition project has been the growth of Germany’s renewable energy sources (RES). Chart 1 (right) shows how it has developed in the past few years and where the government expects it to be by 2050.

The horizontal black line depicts the approximate maximum demand at any time, which is about 85GW (this will not change much in the future).

This shows that installed renewable capacity is now already more or less equal to maximum demand. On a very sunny and windy day, renewables are now capable of meeting the demands of the entire country.

But as we all know, the weather is notoriously unreliable and variable. So a secure system needs more renewable capacity and also more reserve capacity from conventional power plants (mainly fuelled by natural gas) to make sure it can always meet demand.

As Chart 1 (above right) indicates, installed renewable capacity in 2050 is expected to be 180GW, which is roughly twice maximum demand. By that time, the target is that 80% of electricity supply will be from renewables (basically this is how much renewable power you need to meet this level of supply on a regular basis).

Great benefits – but also high costs

In common with other countries moving in the same direction, the government has various motives for this big shift. Renewables are carbon-free and rely on no fossil fuels, so they are an essential component of meeting European emissions targets.

The government hopes for positive spin-off effects on exports, innovation and new jobs. And once the investment cost of the transition has been incurred, we would hope that electricity supply is actually quite cheap. After all, sun and wind are free. Germany sees the energy transition as an investment in the future: we pay for the next generation.

The move to renewables has been a success. It has happened at high speed since the late 1990s. The debate is no longer whether it will succeed, but rather what do we do with ‘too much’ renewable power. But behind this positive story, the dark side is the huge expense.

Early in 2013, the then minister of environment Peter Altmaier mentioned the staggering amount of €1 trillion as the potential cost of the overall transition.

This relied on a quick-and-dirty back-of-the-envelope calculation, which raises many questions and was never confirmed, but it does give a feel for the order of magnitude. The end-users – and thus the voters in Germany – are starting to feel the pain.

Since the installation costs mean that renewables currently cost more per unit of power than conventional power, they are subsidised by a surcharge on the electricity price. In other words, electricity end-users directly pay for it.

As you can see from Chart 2 (above right), the surcharge for small end-users has soared since 2009 to cope with the rapid growth of installed capacity (the step-change that year reflected a sudden big rise in solar power, which is particularly expensive).

The total subsidy is currently about €20bn / year, which amounts to €218 / year per household on top of the normal electricity bill. Whether this is still affordable is a key question in the country right now.

Corporate punishment

The energy transition has meanwhile changed the face of the electricity market, with severe consequences for traditional firms like E.ON and RWE. They are suffering badly at the moment and are having to rethink their business models completely.

In short, they face three challenges. The nuclear phase-out means they have to make very significant write-downs on their nuclear plants, at a loss to the shareholders. They are still fighting the government for compensation payments.

Second, renewable power is suppressing electricity wholesale prices – essentially because they are cheaper to run per unit of power, which under the rules for calculating the wholesale price tends to bring them down across the board.

This means that the revenues for conventional power plants are low and no longer cover the investment costs.

Third, conventional power from gas and coal is being pushed out of the market. This means that a lot of conventional power plants are largely standing idle and not making any money.

Since the future business model for such plants is looking bleak, the power companies are sitting on investments which are not going to be profitable. Of course, RWE and E.ON are adjusting their long-term strategies.

Consumer surcharge for 2015 reduced

While this has been going on, the rising costs for residential end-users have become a political problem.

In 2014 the government responded with a reform package, which slows down the energy transition in an attempt to control the costs. Basically the annual growth of new renewables has been capped to a pre-determined level.

This seems to be working. The surcharge for 2015 has been calculated at 6.17 €c / kWh, which is a small decline compared to 2014. Politically, this may well have been a wise policy, as public support for the energy transition was dwindling. It means that green energy development will happen more slowly.

So far the government appears to be standing by the same targets, perhaps because the explosion in development over the past few years had put it on an even faster track.

Whatever happens from here, one thing remains key: without public support, the energy transition will not work.

 

 

Gert Brunekreeft is Adjunct Professor for Energy Economics at Jacobs University Bremen. He does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

This article was originally published on The Conversation. Read the original article.

The Conversation

 




385722

Germany’s green power surges ahead – at a price that’s finally falling Updated for 2026

Leave a reply




Germany is well on its way towards having a predominantly green electricity supply.

The transition from nuclear and fossil-fuel electricity to using renewables is happening faster than anyone had anticipated. This is a success, but there is a downside: it is hugely expensive.

The energy transition is an explicit policy goal in Germany, having been made a priority project by the German chancellor, Angela Merkel.

It has four strands: reducing CO2 emissions, improving energy efficiency, promoting renewable energy and the gradual phase-out of nuclear power.

Nuclear phase-out is actually an old story that started in 2000 when the Schroeder administration first announced a 20-year timetable.

It was a bit of a ‘yes-no’ rollercoaster until the Fukushima incident, after which the decision in favour was final. This is widely supported by the German public, meaning that nuclear power is politically not an option at the moment.

Installed renewable capacity now equals demand

Yet without a doubt, the most significant development within the energy transition project has been the growth of Germany’s renewable energy sources (RES). Chart 1 (right) shows how it has developed in the past few years and where the government expects it to be by 2050.

The horizontal black line depicts the approximate maximum demand at any time, which is about 85GW (this will not change much in the future).

This shows that installed renewable capacity is now already more or less equal to maximum demand. On a very sunny and windy day, renewables are now capable of meeting the demands of the entire country.

But as we all know, the weather is notoriously unreliable and variable. So a secure system needs more renewable capacity and also more reserve capacity from conventional power plants (mainly fuelled by natural gas) to make sure it can always meet demand.

As Chart 1 (above right) indicates, installed renewable capacity in 2050 is expected to be 180GW, which is roughly twice maximum demand. By that time, the target is that 80% of electricity supply will be from renewables (basically this is how much renewable power you need to meet this level of supply on a regular basis).

Great benefits – but also high costs

In common with other countries moving in the same direction, the government has various motives for this big shift. Renewables are carbon-free and rely on no fossil fuels, so they are an essential component of meeting European emissions targets.

The government hopes for positive spin-off effects on exports, innovation and new jobs. And once the investment cost of the transition has been incurred, we would hope that electricity supply is actually quite cheap. After all, sun and wind are free. Germany sees the energy transition as an investment in the future: we pay for the next generation.

The move to renewables has been a success. It has happened at high speed since the late 1990s. The debate is no longer whether it will succeed, but rather what do we do with ‘too much’ renewable power. But behind this positive story, the dark side is the huge expense.

Early in 2013, the then minister of environment Peter Altmaier mentioned the staggering amount of €1 trillion as the potential cost of the overall transition.

This relied on a quick-and-dirty back-of-the-envelope calculation, which raises many questions and was never confirmed, but it does give a feel for the order of magnitude. The end-users – and thus the voters in Germany – are starting to feel the pain.

Since the installation costs mean that renewables currently cost more per unit of power than conventional power, they are subsidised by a surcharge on the electricity price. In other words, electricity end-users directly pay for it.

As you can see from Chart 2 (above right), the surcharge for small end-users has soared since 2009 to cope with the rapid growth of installed capacity (the step-change that year reflected a sudden big rise in solar power, which is particularly expensive).

The total subsidy is currently about €20bn / year, which amounts to €218 / year per household on top of the normal electricity bill. Whether this is still affordable is a key question in the country right now.

Corporate punishment

The energy transition has meanwhile changed the face of the electricity market, with severe consequences for traditional firms like E.ON and RWE. They are suffering badly at the moment and are having to rethink their business models completely.

In short, they face three challenges. The nuclear phase-out means they have to make very significant write-downs on their nuclear plants, at a loss to the shareholders. They are still fighting the government for compensation payments.

Second, renewable power is suppressing electricity wholesale prices – essentially because they are cheaper to run per unit of power, which under the rules for calculating the wholesale price tends to bring them down across the board.

This means that the revenues for conventional power plants are low and no longer cover the investment costs.

Third, conventional power from gas and coal is being pushed out of the market. This means that a lot of conventional power plants are largely standing idle and not making any money.

Since the future business model for such plants is looking bleak, the power companies are sitting on investments which are not going to be profitable. Of course, RWE and E.ON are adjusting their long-term strategies.

Consumer surcharge for 2015 reduced

While this has been going on, the rising costs for residential end-users have become a political problem.

In 2014 the government responded with a reform package, which slows down the energy transition in an attempt to control the costs. Basically the annual growth of new renewables has been capped to a pre-determined level.

This seems to be working. The surcharge for 2015 has been calculated at 6.17 €c / kWh, which is a small decline compared to 2014. Politically, this may well have been a wise policy, as public support for the energy transition was dwindling. It means that green energy development will happen more slowly.

So far the government appears to be standing by the same targets, perhaps because the explosion in development over the past few years had put it on an even faster track.

Whatever happens from here, one thing remains key: without public support, the energy transition will not work.

 

 

Gert Brunekreeft is Adjunct Professor for Energy Economics at Jacobs University Bremen. He does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

This article was originally published on The Conversation. Read the original article.

The Conversation

 




385722

Germany’s green power surges ahead – at a price that’s finally falling Updated for 2026

Leave a reply




Germany is well on its way towards having a predominantly green electricity supply.

The transition from nuclear and fossil-fuel electricity to using renewables is happening faster than anyone had anticipated. This is a success, but there is a downside: it is hugely expensive.

The energy transition is an explicit policy goal in Germany, having been made a priority project by the German chancellor, Angela Merkel.

It has four strands: reducing CO2 emissions, improving energy efficiency, promoting renewable energy and the gradual phase-out of nuclear power.

Nuclear phase-out is actually an old story that started in 2000 when the Schroeder administration first announced a 20-year timetable.

It was a bit of a ‘yes-no’ rollercoaster until the Fukushima incident, after which the decision in favour was final. This is widely supported by the German public, meaning that nuclear power is politically not an option at the moment.

Installed renewable capacity now equals demand

Yet without a doubt, the most significant development within the energy transition project has been the growth of Germany’s renewable energy sources (RES). Chart 1 (right) shows how it has developed in the past few years and where the government expects it to be by 2050.

The horizontal black line depicts the approximate maximum demand at any time, which is about 85GW (this will not change much in the future).

This shows that installed renewable capacity is now already more or less equal to maximum demand. On a very sunny and windy day, renewables are now capable of meeting the demands of the entire country.

But as we all know, the weather is notoriously unreliable and variable. So a secure system needs more renewable capacity and also more reserve capacity from conventional power plants (mainly fuelled by natural gas) to make sure it can always meet demand.

As Chart 1 (above right) indicates, installed renewable capacity in 2050 is expected to be 180GW, which is roughly twice maximum demand. By that time, the target is that 80% of electricity supply will be from renewables (basically this is how much renewable power you need to meet this level of supply on a regular basis).

Great benefits – but also high costs

In common with other countries moving in the same direction, the government has various motives for this big shift. Renewables are carbon-free and rely on no fossil fuels, so they are an essential component of meeting European emissions targets.

The government hopes for positive spin-off effects on exports, innovation and new jobs. And once the investment cost of the transition has been incurred, we would hope that electricity supply is actually quite cheap. After all, sun and wind are free. Germany sees the energy transition as an investment in the future: we pay for the next generation.

The move to renewables has been a success. It has happened at high speed since the late 1990s. The debate is no longer whether it will succeed, but rather what do we do with ‘too much’ renewable power. But behind this positive story, the dark side is the huge expense.

Early in 2013, the then minister of environment Peter Altmaier mentioned the staggering amount of €1 trillion as the potential cost of the overall transition.

This relied on a quick-and-dirty back-of-the-envelope calculation, which raises many questions and was never confirmed, but it does give a feel for the order of magnitude. The end-users – and thus the voters in Germany – are starting to feel the pain.

Since the installation costs mean that renewables currently cost more per unit of power than conventional power, they are subsidised by a surcharge on the electricity price. In other words, electricity end-users directly pay for it.

As you can see from Chart 2 (above right), the surcharge for small end-users has soared since 2009 to cope with the rapid growth of installed capacity (the step-change that year reflected a sudden big rise in solar power, which is particularly expensive).

The total subsidy is currently about €20bn / year, which amounts to €218 / year per household on top of the normal electricity bill. Whether this is still affordable is a key question in the country right now.

Corporate punishment

The energy transition has meanwhile changed the face of the electricity market, with severe consequences for traditional firms like E.ON and RWE. They are suffering badly at the moment and are having to rethink their business models completely.

In short, they face three challenges. The nuclear phase-out means they have to make very significant write-downs on their nuclear plants, at a loss to the shareholders. They are still fighting the government for compensation payments.

Second, renewable power is suppressing electricity wholesale prices – essentially because they are cheaper to run per unit of power, which under the rules for calculating the wholesale price tends to bring them down across the board.

This means that the revenues for conventional power plants are low and no longer cover the investment costs.

Third, conventional power from gas and coal is being pushed out of the market. This means that a lot of conventional power plants are largely standing idle and not making any money.

Since the future business model for such plants is looking bleak, the power companies are sitting on investments which are not going to be profitable. Of course, RWE and E.ON are adjusting their long-term strategies.

Consumer surcharge for 2015 reduced

While this has been going on, the rising costs for residential end-users have become a political problem.

In 2014 the government responded with a reform package, which slows down the energy transition in an attempt to control the costs. Basically the annual growth of new renewables has been capped to a pre-determined level.

This seems to be working. The surcharge for 2015 has been calculated at 6.17 €c / kWh, which is a small decline compared to 2014. Politically, this may well have been a wise policy, as public support for the energy transition was dwindling. It means that green energy development will happen more slowly.

So far the government appears to be standing by the same targets, perhaps because the explosion in development over the past few years had put it on an even faster track.

Whatever happens from here, one thing remains key: without public support, the energy transition will not work.

 

 

Gert Brunekreeft is Adjunct Professor for Energy Economics at Jacobs University Bremen. He does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

This article was originally published on The Conversation. Read the original article.

The Conversation

 




385722

Germany’s green power surges ahead – at a price that’s finally falling Updated for 2026

Leave a reply




Germany is well on its way towards having a predominantly green electricity supply.

The transition from nuclear and fossil-fuel electricity to using renewables is happening faster than anyone had anticipated. This is a success, but there is a downside: it is hugely expensive.

The energy transition is an explicit policy goal in Germany, having been made a priority project by the German chancellor, Angela Merkel.

It has four strands: reducing CO2 emissions, improving energy efficiency, promoting renewable energy and the gradual phase-out of nuclear power.

Nuclear phase-out is actually an old story that started in 2000 when the Schroeder administration first announced a 20-year timetable.

It was a bit of a ‘yes-no’ rollercoaster until the Fukushima incident, after which the decision in favour was final. This is widely supported by the German public, meaning that nuclear power is politically not an option at the moment.

Installed renewable capacity now equals demand

Yet without a doubt, the most significant development within the energy transition project has been the growth of Germany’s renewable energy sources (RES). Chart 1 (right) shows how it has developed in the past few years and where the government expects it to be by 2050.

The horizontal black line depicts the approximate maximum demand at any time, which is about 85GW (this will not change much in the future).

This shows that installed renewable capacity is now already more or less equal to maximum demand. On a very sunny and windy day, renewables are now capable of meeting the demands of the entire country.

But as we all know, the weather is notoriously unreliable and variable. So a secure system needs more renewable capacity and also more reserve capacity from conventional power plants (mainly fuelled by natural gas) to make sure it can always meet demand.

As Chart 1 (above right) indicates, installed renewable capacity in 2050 is expected to be 180GW, which is roughly twice maximum demand. By that time, the target is that 80% of electricity supply will be from renewables (basically this is how much renewable power you need to meet this level of supply on a regular basis).

Great benefits – but also high costs

In common with other countries moving in the same direction, the government has various motives for this big shift. Renewables are carbon-free and rely on no fossil fuels, so they are an essential component of meeting European emissions targets.

The government hopes for positive spin-off effects on exports, innovation and new jobs. And once the investment cost of the transition has been incurred, we would hope that electricity supply is actually quite cheap. After all, sun and wind are free. Germany sees the energy transition as an investment in the future: we pay for the next generation.

The move to renewables has been a success. It has happened at high speed since the late 1990s. The debate is no longer whether it will succeed, but rather what do we do with ‘too much’ renewable power. But behind this positive story, the dark side is the huge expense.

Early in 2013, the then minister of environment Peter Altmaier mentioned the staggering amount of €1 trillion as the potential cost of the overall transition.

This relied on a quick-and-dirty back-of-the-envelope calculation, which raises many questions and was never confirmed, but it does give a feel for the order of magnitude. The end-users – and thus the voters in Germany – are starting to feel the pain.

Since the installation costs mean that renewables currently cost more per unit of power than conventional power, they are subsidised by a surcharge on the electricity price. In other words, electricity end-users directly pay for it.

As you can see from Chart 2 (above right), the surcharge for small end-users has soared since 2009 to cope with the rapid growth of installed capacity (the step-change that year reflected a sudden big rise in solar power, which is particularly expensive).

The total subsidy is currently about €20bn / year, which amounts to €218 / year per household on top of the normal electricity bill. Whether this is still affordable is a key question in the country right now.

Corporate punishment

The energy transition has meanwhile changed the face of the electricity market, with severe consequences for traditional firms like E.ON and RWE. They are suffering badly at the moment and are having to rethink their business models completely.

In short, they face three challenges. The nuclear phase-out means they have to make very significant write-downs on their nuclear plants, at a loss to the shareholders. They are still fighting the government for compensation payments.

Second, renewable power is suppressing electricity wholesale prices – essentially because they are cheaper to run per unit of power, which under the rules for calculating the wholesale price tends to bring them down across the board.

This means that the revenues for conventional power plants are low and no longer cover the investment costs.

Third, conventional power from gas and coal is being pushed out of the market. This means that a lot of conventional power plants are largely standing idle and not making any money.

Since the future business model for such plants is looking bleak, the power companies are sitting on investments which are not going to be profitable. Of course, RWE and E.ON are adjusting their long-term strategies.

Consumer surcharge for 2015 reduced

While this has been going on, the rising costs for residential end-users have become a political problem.

In 2014 the government responded with a reform package, which slows down the energy transition in an attempt to control the costs. Basically the annual growth of new renewables has been capped to a pre-determined level.

This seems to be working. The surcharge for 2015 has been calculated at 6.17 €c / kWh, which is a small decline compared to 2014. Politically, this may well have been a wise policy, as public support for the energy transition was dwindling. It means that green energy development will happen more slowly.

So far the government appears to be standing by the same targets, perhaps because the explosion in development over the past few years had put it on an even faster track.

Whatever happens from here, one thing remains key: without public support, the energy transition will not work.

 

 

Gert Brunekreeft is Adjunct Professor for Energy Economics at Jacobs University Bremen. He does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

This article was originally published on The Conversation. Read the original article.

The Conversation

 




385722

Germany’s green power surges ahead – at a price that’s finally falling Updated for 2026

Leave a reply




Germany is well on its way towards having a predominantly green electricity supply.

The transition from nuclear and fossil-fuel electricity to using renewables is happening faster than anyone had anticipated. This is a success, but there is a downside: it is hugely expensive.

The energy transition is an explicit policy goal in Germany, having been made a priority project by the German chancellor, Angela Merkel.

It has four strands: reducing CO2 emissions, improving energy efficiency, promoting renewable energy and the gradual phase-out of nuclear power.

Nuclear phase-out is actually an old story that started in 2000 when the Schroeder administration first announced a 20-year timetable.

It was a bit of a ‘yes-no’ rollercoaster until the Fukushima incident, after which the decision in favour was final. This is widely supported by the German public, meaning that nuclear power is politically not an option at the moment.

Installed renewable capacity now equals demand

Yet without a doubt, the most significant development within the energy transition project has been the growth of Germany’s renewable energy sources (RES). Chart 1 (right) shows how it has developed in the past few years and where the government expects it to be by 2050.

The horizontal black line depicts the approximate maximum demand at any time, which is about 85GW (this will not change much in the future).

This shows that installed renewable capacity is now already more or less equal to maximum demand. On a very sunny and windy day, renewables are now capable of meeting the demands of the entire country.

But as we all know, the weather is notoriously unreliable and variable. So a secure system needs more renewable capacity and also more reserve capacity from conventional power plants (mainly fuelled by natural gas) to make sure it can always meet demand.

As Chart 1 (above right) indicates, installed renewable capacity in 2050 is expected to be 180GW, which is roughly twice maximum demand. By that time, the target is that 80% of electricity supply will be from renewables (basically this is how much renewable power you need to meet this level of supply on a regular basis).

Great benefits – but also high costs

In common with other countries moving in the same direction, the government has various motives for this big shift. Renewables are carbon-free and rely on no fossil fuels, so they are an essential component of meeting European emissions targets.

The government hopes for positive spin-off effects on exports, innovation and new jobs. And once the investment cost of the transition has been incurred, we would hope that electricity supply is actually quite cheap. After all, sun and wind are free. Germany sees the energy transition as an investment in the future: we pay for the next generation.

The move to renewables has been a success. It has happened at high speed since the late 1990s. The debate is no longer whether it will succeed, but rather what do we do with ‘too much’ renewable power. But behind this positive story, the dark side is the huge expense.

Early in 2013, the then minister of environment Peter Altmaier mentioned the staggering amount of €1 trillion as the potential cost of the overall transition.

This relied on a quick-and-dirty back-of-the-envelope calculation, which raises many questions and was never confirmed, but it does give a feel for the order of magnitude. The end-users – and thus the voters in Germany – are starting to feel the pain.

Since the installation costs mean that renewables currently cost more per unit of power than conventional power, they are subsidised by a surcharge on the electricity price. In other words, electricity end-users directly pay for it.

As you can see from Chart 2 (above right), the surcharge for small end-users has soared since 2009 to cope with the rapid growth of installed capacity (the step-change that year reflected a sudden big rise in solar power, which is particularly expensive).

The total subsidy is currently about €20bn / year, which amounts to €218 / year per household on top of the normal electricity bill. Whether this is still affordable is a key question in the country right now.

Corporate punishment

The energy transition has meanwhile changed the face of the electricity market, with severe consequences for traditional firms like E.ON and RWE. They are suffering badly at the moment and are having to rethink their business models completely.

In short, they face three challenges. The nuclear phase-out means they have to make very significant write-downs on their nuclear plants, at a loss to the shareholders. They are still fighting the government for compensation payments.

Second, renewable power is suppressing electricity wholesale prices – essentially because they are cheaper to run per unit of power, which under the rules for calculating the wholesale price tends to bring them down across the board.

This means that the revenues for conventional power plants are low and no longer cover the investment costs.

Third, conventional power from gas and coal is being pushed out of the market. This means that a lot of conventional power plants are largely standing idle and not making any money.

Since the future business model for such plants is looking bleak, the power companies are sitting on investments which are not going to be profitable. Of course, RWE and E.ON are adjusting their long-term strategies.

Consumer surcharge for 2015 reduced

While this has been going on, the rising costs for residential end-users have become a political problem.

In 2014 the government responded with a reform package, which slows down the energy transition in an attempt to control the costs. Basically the annual growth of new renewables has been capped to a pre-determined level.

This seems to be working. The surcharge for 2015 has been calculated at 6.17 €c / kWh, which is a small decline compared to 2014. Politically, this may well have been a wise policy, as public support for the energy transition was dwindling. It means that green energy development will happen more slowly.

So far the government appears to be standing by the same targets, perhaps because the explosion in development over the past few years had put it on an even faster track.

Whatever happens from here, one thing remains key: without public support, the energy transition will not work.

 

 

Gert Brunekreeft is Adjunct Professor for Energy Economics at Jacobs University Bremen. He does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

This article was originally published on The Conversation. Read the original article.

The Conversation

 




385722

Germany’s green power surges ahead – at a price that’s finally falling Updated for 2026

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Germany is well on its way towards having a predominantly green electricity supply.

The transition from nuclear and fossil-fuel electricity to using renewables is happening faster than anyone had anticipated. This is a success, but there is a downside: it is hugely expensive.

The energy transition is an explicit policy goal in Germany, having been made a priority project by the German chancellor, Angela Merkel.

It has four strands: reducing CO2 emissions, improving energy efficiency, promoting renewable energy and the gradual phase-out of nuclear power.

Nuclear phase-out is actually an old story that started in 2000 when the Schroeder administration first announced a 20-year timetable.

It was a bit of a ‘yes-no’ rollercoaster until the Fukushima incident, after which the decision in favour was final. This is widely supported by the German public, meaning that nuclear power is politically not an option at the moment.

Installed renewable capacity now equals demand

Yet without a doubt, the most significant development within the energy transition project has been the growth of Germany’s renewable energy sources (RES). Chart 1 (right) shows how it has developed in the past few years and where the government expects it to be by 2050.

The horizontal black line depicts the approximate maximum demand at any time, which is about 85GW (this will not change much in the future).

This shows that installed renewable capacity is now already more or less equal to maximum demand. On a very sunny and windy day, renewables are now capable of meeting the demands of the entire country.

But as we all know, the weather is notoriously unreliable and variable. So a secure system needs more renewable capacity and also more reserve capacity from conventional power plants (mainly fuelled by natural gas) to make sure it can always meet demand.

As Chart 1 (above right) indicates, installed renewable capacity in 2050 is expected to be 180GW, which is roughly twice maximum demand. By that time, the target is that 80% of electricity supply will be from renewables (basically this is how much renewable power you need to meet this level of supply on a regular basis).

Great benefits – but also high costs

In common with other countries moving in the same direction, the government has various motives for this big shift. Renewables are carbon-free and rely on no fossil fuels, so they are an essential component of meeting European emissions targets.

The government hopes for positive spin-off effects on exports, innovation and new jobs. And once the investment cost of the transition has been incurred, we would hope that electricity supply is actually quite cheap. After all, sun and wind are free. Germany sees the energy transition as an investment in the future: we pay for the next generation.

The move to renewables has been a success. It has happened at high speed since the late 1990s. The debate is no longer whether it will succeed, but rather what do we do with ‘too much’ renewable power. But behind this positive story, the dark side is the huge expense.

Early in 2013, the then minister of environment Peter Altmaier mentioned the staggering amount of €1 trillion as the potential cost of the overall transition.

This relied on a quick-and-dirty back-of-the-envelope calculation, which raises many questions and was never confirmed, but it does give a feel for the order of magnitude. The end-users – and thus the voters in Germany – are starting to feel the pain.

Since the installation costs mean that renewables currently cost more per unit of power than conventional power, they are subsidised by a surcharge on the electricity price. In other words, electricity end-users directly pay for it.

As you can see from Chart 2 (above right), the surcharge for small end-users has soared since 2009 to cope with the rapid growth of installed capacity (the step-change that year reflected a sudden big rise in solar power, which is particularly expensive).

The total subsidy is currently about €20bn / year, which amounts to €218 / year per household on top of the normal electricity bill. Whether this is still affordable is a key question in the country right now.

Corporate punishment

The energy transition has meanwhile changed the face of the electricity market, with severe consequences for traditional firms like E.ON and RWE. They are suffering badly at the moment and are having to rethink their business models completely.

In short, they face three challenges. The nuclear phase-out means they have to make very significant write-downs on their nuclear plants, at a loss to the shareholders. They are still fighting the government for compensation payments.

Second, renewable power is suppressing electricity wholesale prices – essentially because they are cheaper to run per unit of power, which under the rules for calculating the wholesale price tends to bring them down across the board.

This means that the revenues for conventional power plants are low and no longer cover the investment costs.

Third, conventional power from gas and coal is being pushed out of the market. This means that a lot of conventional power plants are largely standing idle and not making any money.

Since the future business model for such plants is looking bleak, the power companies are sitting on investments which are not going to be profitable. Of course, RWE and E.ON are adjusting their long-term strategies.

Consumer surcharge for 2015 reduced

While this has been going on, the rising costs for residential end-users have become a political problem.

In 2014 the government responded with a reform package, which slows down the energy transition in an attempt to control the costs. Basically the annual growth of new renewables has been capped to a pre-determined level.

This seems to be working. The surcharge for 2015 has been calculated at 6.17 €c / kWh, which is a small decline compared to 2014. Politically, this may well have been a wise policy, as public support for the energy transition was dwindling. It means that green energy development will happen more slowly.

So far the government appears to be standing by the same targets, perhaps because the explosion in development over the past few years had put it on an even faster track.

Whatever happens from here, one thing remains key: without public support, the energy transition will not work.

 

 

Gert Brunekreeft is Adjunct Professor for Energy Economics at Jacobs University Bremen. He does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

This article was originally published on The Conversation. Read the original article.

The Conversation

 




385722

Hinkley C gets the go-ahead – but will it prove a dodgy nuclear deal too far? Updated for 2026

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The European Commission has just voted today to allow the UK to subsidise two new EDF nuclear reactors at Hinkley Point C to the tune of £20 billion.

This sets an important precedent, and will have consequences not just in UK but also throughout the EU. If the UK can throw billions at subsidising nuclear, then countries throughout the EU could do the same.

Given there’s only so much money to go round, if nuclear power is allowed to grab a huge share of the European energy finance pot, that will seriously diminish the funds available to develop the renewable energy revolution.

At least we now know that this is indeed a subsidy paid for by public money. The UK Government had contrived a position, by which they argued that the support for Hinkley C would not be a subsidy if it was also available to other low carbon technologies, including of course renewables.

But the subsidies the UK is determined to dole out with such largesse to EDF are not available to renewable energy. In particular renewable energy support contracts typically last for 15 or 20 years – compared to the 35-year contract on offer to EDF.

UK’s billions will compensate EDF, no matter what

This is compounded by a new agreement between Ed Davey, the Secretary of State, and EDF which now allow direct compensation from DECC to EDF if the project runs over-cost or if future UK governments or environmental conditions derail the project.

EDF is building two reactors in Finland and France, and they are both hugely over-cost and over-time. EDF’s Flamanville reactor in France was due to be completed by 2012 at a cost of €3.3 billion, but is now projected for completion in 2016 at a cost of €8.5 billion.

Finland’s Olkiluoto-3 reactor, the first EPR construction project, is likely to be a decade behind schedule upon delivery, with a projected completion date of 2018. Construction of the 1.6GW plant began in 2005 and was originally due for completion in 2009. Cost figures are similar to those for Flamanville.

There is no reason to believe that Hinkley C, with its two 1.6GW reactors, will perform any better. This puts the UK tax payer as well as the energy consumer on the hook for the enormous costs of Hinkley Point, already the most expensive nuclear power station in the world on official estimates.

A rushed decision under pressure – strengthens case for legal challen​ge

Earlier this year, The Commission published a landmark report which detailed at great length a substantive set of concerns with the deal.

Originally, the Commission said that UK State Aid for nuclear would distort the EU and UK energy markets, precisely because it shields nuclear from financial risks that other energy operators are subject to.

The Commission also doubted that the level of profit for the UK deal was a reasonable rate of return taking into account the level of risk involved.

Furthermore, it said, UK subsidies would provide the certainty of a stable revenue stream under lenient conditions by eliminating market risks from the commercial activity of nuclear electricity generation for the amazingly long 35-year contract period.

As the Commission said in it’s original report: “Nuclear energy generation has the capacity to crowd out alternative investments in technologies or combinations of technologies, including renewable energy sources, which are likely to emerge in the absence of specific UK State Aid subsidies for new nuclear.”

Now the Commission has performed a 180 degree volte face. But it’s not because the facts of the case have changed. It’s the result of enormous political and industry pressure.

Why now – at the tail end of a Commission that’s run out of steam?

The timing of the decision also warrants attention, coming as it does right at the tail end of Barroso’s increasingly discredited Commission. The outgoing administration simply rushed it through at the last moment. And it only got its way by a narrow margin, with the support of just 16 Commissioners out of 28.

Among those raising concerns ahead of today’s meeting were Connie Hedegaard, Climate Commissioner, and Environment Commission Janez Potocnik. Regional Policy Commissioner Johannes Hahn, from Austria, expressed outright opposition.

The decision deprives the new Commission the opportunity to review and reflect on a decision which will set a significant precedent for pan-EU energy and competition policy. That this decision has been taken in undue haste only strengthens the grounds for, and likely success of, a legal challenge, and one is current,y being prepared by Austria.

Also, the EC decision document refers to a significant body of new evidence from the UK and EDF, yet there is no access to this information – which means that it is impossible to check its veracity, or challenge the arguments made.

Since it is this evidence that has – so we are told – persuaded the Commission to change its mind, it should be made public to make sure it can be properly scrutinised and validated.

We do know that the ‘strike price’ of £92.50 per megawatt hour, guaranteed and inflation-proofed for for 35 years remains in place. But Commission Vice-President Joaquin Almunia assures us that the revised deal includes ‘profit-sharing’ provisions that will limit the gains to EDF and return them to tax payers:

“After the Commission’s intervention, the UK measures in favour of Hinkley Point nuclear power station have been significantly modified, limiting any distortions of competition in the single market.

“These modifications will also achieve significant savings for UK taxpayers. On this basis and after a thorough investigation, the Commission can now conclude that the support is compatible with EU state aid rules.”

But until the whole deal is published, we simply cannot tell if this represents a great victory for the British public – or a dodgy under-the-table political fix.

Molly Scott Cato, Green MEP for Southwest England, clearly believes the latter: “It is a scandal that one of the final acts of the Barroso Commission is to turn a blind eye to the illegality of the Hinkley deal as some kind of quid pro quo for Germany’s renewable energy support scheme.”

Why is this a European issue?

Distorting nuclear subsidies in the UK will have a big impact across the whole EU electricity market. Increased renewable energy ‘pooling’ between countries will mean much more European-wide balancing to match supply and demand on a continental scale.

For example, solar power in Germany and southern Europe, hydro electric power in Norway and Sweden, and wind in the west may all produce local surpluses that can be transmitted afar to reduce fossil fuel burning on the far side of Europe.

But with very big nuclear subsidies, the market for renewable technologies will be reduced. And the inflexible output of nuclear power stations will increase the difficulty of establishing new renewable generation capacity, and pooling its output, across the whole EU – not just in the UK.

If the precedent is accepted for nuclear specific subsidies in the UK, then other countries are likely to follow the UK’s lead – beginning with Poland and the Czech Republic.

We will challenge this disgraceful decision

A number high-level energy sector people and I are working with a large set of pan-EU and pan-UK energy associations, corporations and small companies who will be significantly – and negatively – affected by this decision.

We are convinced that this state aid will distort the UK and pan-EU energy market, and that, in any case, subsidies should not be provided to a mature technology like nuclear power – a point argued by the Commission argued in its original report.

We now intend to join Austria and press a legal challenge through the EU Court of Justice. In consultation with our legal team we have identified key criteria that will allow us to challenge the legality of this decision.

We argue that the decision by the European Commission to allow a support mechanism for new nuclear installations from public funds and guarantees will directly impact investment plans and business strategies in the UK and across Europe.

Those adversely affected include renewable energy generators, installers, equipment manufacturers, other efficient technology providers, fitters of insulation and other energy saving equipment, and investors in decentralized renewable energy projects.

Do we feel lucky today?

But at root, the argument is all about what we want – a plutonium economy, or a renewable one? In the UK and across Europe, public opinion is firmly on the side of renewables, and against nuclear power – all the more so following the triple nuclear reactor meltdown at Fukushima, Japan.

Maybe the question we need to ask ourselves is, ‘do we feel lucky?’ Because if we opt for a nuclear future, we had better be feeling very lucky, indeed.

 

 

Dr Paul Dorfman is a Senior Researcher at the Energy Institute UCL, Joseph Rowntree Charitable Trust Nuclear Policy Research Fellow; Founder of the Nuclear Consulting Group, Member, European Nuclear Energy Forum Transparency and Risk Working Groups, served as Secretary to the UK government scientific advisory Committee Examining Radiation Risks from Internal Emitters.

Paul is also ‘Expert’ to the European Economic and Social Committee Opinion: ‘European Energy Dialogue: Towards a European Energy Community’, and led the European Environment Agency response to Fukushima in ‘Late Lessons from Early Warnings’ Vol 2.

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