Trouble in transition

Is it “Huhner kommen nach Hause, um zu schlafen” time for Germany’s Angela Merkel?

That’s “the chickens come home to roost” – and, in the case of Merkel’s signature Energiewende policy, still being lauded by green boosters as “paving the way for the world,” to quote one just last month, the portents from independent analysis are not too good.

Apart from the well-publicized political problems being encountered by a committee appointed by the Berlin government in the wake of its last federal election to advise on an exit from coal power, the independent body that audits the German budget, the Bundersrechnungshof (BRH), has just declared that at least 160 billions euros have been spent on the program over the past five years alone, costs are continuing to rise and the abatement targets remain out of reach.

The BRH points out that Merkel has 26 laws, 33 regulations, 72 indicators and 675 bureaucrats engaged in the Energiewende program but “there is no place where everything comes together, no place that assumes overall responsibility.”

In particular, BRH says, there are no quantified targets and no measurable indicators for energy affordability and security of supply.

The auditors’ proposed solution: scrap the whole bureaucratic shebang and rely on “simple and transparent CO2 pricing.”

And the German government response? It got the report a month in advance of it becoming public and whipped out a retort last week that Energiewende is “effectively and efficiently co-ordinated.”

Perhaps the best (or worst) aspect of the government reaction is the bald-faced effrontery of cost denial. The multi-billion euro levy that supports the German version of the RET, says the economics ministry, “should not be counted as a cost of the transition.” And the billions of euros in relief payments to German manufacturers to compensate for higher energy bills are “measures of industrial policy that cannot be attributed to Energiewende.”

The regime also offers a marvelous Sir Humphrey response to demands for an independent cost-benefit analysis of the policy: this could only be done by comparing a world with and a world without Energiewende, the government declares– and this could not be achieved because of the large number of uncertain basic assumptions that would be involved!

This stance has its foundation in the fact that, since 2000, four different political parties have been in power in Germany in three coalitions and all have supported the policy – and opinion polls still show that 90 per cent of Germans see Energiewende as vital to the country’s future.

This is despite the fact that German household energy prices (the trigger down here for political upheaval) have risen to 308 euros a megawatt hour compared with an average of $205 in the European Union as a whole – and the RET subsidy is now double the level that Merkel & Co in 2011 promised it would not exceed in 2020. (Non-energy intensive industry in Germany pays 96.5 euros per MWh for power against the EU average of 85.)

In the context of all the boosting here of the need for an integrated system plan to support much larger levels of wind, solar and hydro power in the NEM, it should be noted that, while the German target for high voltage transmission to support Energiewende is construction of 3,582 kilometres of lines by 2020, to date less than 900 km have been built.)

Allow me a digression, although it is not really out of context: the summer just ended in Europe was, by their standards, a scorcher and notable for weeks of heatwaves with barely a breeze. As a result in Germany, where there are 30,000 wind turbines, capacity on line on some days was just 1,300 megawatts – against a total installed of 58,000 MW. Ironically, the supply security savior was Germany’s brown coal (lignite) power stations, which rely on mine water for cooling, versus the black coal and nuclear plants that also had to reduce capacity because of the high water temperatures at their sources.

(For the record, power generation in Germany for the first nine months of 2018 has been provided by 101 terawatt hours of brown coal plant, 56 TWh from black coal, 53 TWh from nuclear plants, 28 TWh gas, 15 TWh hydro, 34 TWh biomass, 74 TWh wind power and 40 TWh solar power. That’s a fossil-fuelled share of 46 per cent plus 13 per cent for nuclear versus under 29 per cent for wind and solar.)

One last thing: back in 2004 the federal German environment minister was Jurgen Trittin. He was a Green, part of chancellor Gerhard Schroder’s “red-green” coalition and led the policy decision to phase out German nuclear power by 2020 (you can see from the data above how successful that has been). Trittin famously (that should probably now be infamously) told German householders in 2004 that support for renewable energy to achieve the transition would “cost no more than a scoop of ice cream a month.”  And here is the president of the BRH today: “The expenditure for the ecological restructuring of energy supply is in blatant disproportion to the hitherto poor yield.”

Do bear this in mind when observing our home-grown Greens going on about big Australian renewables targets and how they will help cut the price of our power.

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