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In Germany, the energy transition continues

By Peter Friederici | March 15, 2021

The windenergy park "Schneebergerhof" in Germany (Rhineland-Palatinate), with thin film solar cells in the forground. Photo credit: Armin Kübelbeck, CC-BY-SA, Wikimedia Commons

In Germany, the energy transition continues

By Peter Friederici | March 15, 2021

Germany’s decades-long effort to wean itself from fossil fuel energy might fittingly be viewed in terms of the country’s favorite sport. Like its often dominating national men’s soccer team, Germany has been a world leader in the ambition of its climate change policies since the 1990s, setting one challenging target after another while encouraging other countries to do the same through international agreements.

In 2010 Chancellor Angela Merkel followed the cue of previous national leaders in announcing that the country would reduce its overall greenhouse gas emissions by 40 percent by 2020. But consumer revolt about electricity prices, inaction by the country’s powerful auto industry, and technological hurdles made that goal look increasingly unreachable—until the COVID-19 pandemic hit last year.

Now, in the equivalent of a come-from-behind goal just before the final whistle, it looks like Germany did reach its target. According to a new analysis by the German energy think tank Agora Energiewende, it cut overall emissions by 42 percent from 1990 levels.[1]

Cue the cheers from the relieved fans. But, as in any postgame dissection of what happened, this last-minute triumph raises inevitable questions about the next set of matches.

The first comes from the acknowledgment that Germany was playing against a hobbled opponent in 2020: Emissions dropped sharply because of pandemic-related restrictions and a recession that decimated travel, manufacturing, and consumer spending. In addition, energy use for heating dropped amid mild winter weather. Without those factors, according to Agora, the emissions decrease would have been around 38 percent, short of the nation’s target.

So the immediate question is: How much will Germany’s emissions rise as the pandemic loosens its grip? But a larger question looms, too. As the climate crisis intensifies, is even one of the world’s most disciplined and hard-working climate players ambitious enough?

The Energiewende’s decade of challenges

Germany’s Energiewende or “energy transition” has been one of the country’s signature climate change efforts since 2000, when its federal government developed ambitious national goals on emissions in concert with targeted policies to incentivize renewable energy. In particular, a financial policy known as the “feed-in tariff” provided guarantees to renewable energy developers that the electricity they produced would be prioritized for sale to the national grid.

This led to a boom in renewable energy production, often at a small scale.[2] Across Germany, solar panels popped up on houses, barns, and businesses, while giant wind turbines came to be a common feature outside towns and villages. Many were installed by municipalities or private owners rather than big utility companies.

By 2010, Merkel had been nicknamed the “climate chancellor,” and she decided to further define the country’s federal targets. Legislators coupled new renewable electricity goals with ambitious plans for energy efficiency and with incentives for improving the electric grid and the development of large-scale offshore wind farms.

But these plans were complicated by the 2011 Fukushima nuclear accident in Japan, which caused Merkel to do an abrupt about-face on her previous support for nuclear power. Within months, lawmakers had decided to permanently shutter seven of the country’s nuclear plants, and to phase out the rest by 2022.

Nuclear power produced more than a fifth of the nation’s electricity in 2010, so this abrupt change in policy was wrenching. The decision kicked off a decade of difficult decisions and, according to critics, backsliding. Utility customers complained because the monthly fees they were charged to help pay for renewable electricity development rose sharply. The country’s states squabbled about investment priorities and the development of the new high-voltage lines that were needed to move electricity from wind farms. The domestic industry that produced easily minable but highly polluting lignite or “brown coal” campaigned effectively for its survival,[3] while the politically powerful automobile industry resisted virtually all efforts to reduce emissions from transportation.

Internationally, things went better for a while—until they didn’t. Merkel helped set the goals for the Paris Climate Accord of 2015, only to see that international agreement suffer a blow when US President Donald Trump repudiated it in 2017. And as the agreement’s five-year anniversary neared last year, it became apparent that most nations were well behind in working toward the emissions targets they’d set. To critics, Merkel’s “climate chancellor” nickname increasingly came to seem a relic of another era

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Replacing coal with wind and sun

But there were bright spots, especially in the development of renewable electricity and in the phasing out of the country’s coal industry. During the “Wirtschaftswunder” or “economic miracle” of the 1950s and ’60s, as both West and East Germany rebuilt after World War Two, the coal industry was one of the main economic drivers on both sides of the Iron Curtain; it supported well over half a million mining jobs. They were concentrated in underground mines in the West German Rhineland, rich with hard anthracite coal, and in several regions in East Germany where lignite lies near the surface.

The end of the Cold War caused a decline in lignite mining jobs. In the meantime, rising labor costs, cheaper imports, and European Union regulations caused underground mining in the Rhineland to become uncompetitive.

A newly unified Germany launched a drawn-out campaign to shutter the underground mines, the last of which closed in 2018. That was made politically feasible by generous pension payments made available to laid-off miners.[4]

Renewable energy, meanwhile, became a point of national pride. Along with countless small-scale wind and solar installations, huge turbine arrays were built in the North and Baltic seas, where wind blows more reliably than on land. By the end of 2020, more than 3,000 turbines were in place offshore, producing more than 7,000 megawatts of electricity; turbines onshore produced even more.

In 2020, according to the country’s Bundesnetzagentur or Federal Network Agency, renewable sources produced almost half the nation’s electricity, exceeding for the first time the amount attributable to fossil fuels. Wind power was responsible for more than a quarter, and solar panels for about 10 percent, with the rest coming from hydropower and biomass.

On some days renewables practically supplant fossil fuels. On a single sunny, breezy afternoon in May, the agency reported, the nation’s renewable energy generators produced 112 percent of the electricity needed in the entire country.

The challenge, of course, is that electricity users consume when the wind doesn’t blow and the sun doesn’t shine. But renewables have become a core rather than a fringe part of the nation’s energy economy. According to the International Renewable Energy Agency, more than 300,000 Germans now find employment in the renewable energy sector—not yet quite on par with the post-war coal economy, but the numbers are growing fast.

Exiting coal for good

Hurdles remain, though. An outsized percentage of Germany’s emissions still come from coal burned in its more than 80 power plants. Some is imported from other countries, but a significant percentage is lignite extracted from giant strip mines.

Despite heavy opposition from both environmentalists and from local communities that have literally been displaced by mining, lignite extraction is slated to continue for a while. According to a federal agreement reached last year, all the nation’s coal power plants and mines will be shut down no later than 2038. In an echo of the generous payouts that made the country’s hard-coal shutdown possible, the deal earmarks more than 40 billion Euros in federal spending for buyouts to utility companies, direct payments to unemployed workers, and economic development assistance for rural coal mining regions.

Environmentalists have gone on record as saying that this timetable is not nearly ambitious enough. There’s increasing pressure on the government to set a more ambitious goal of accomplishing the Kohleaustieg or “exit from coal” by 2030 rather than 2038. That will likely be needed if Germany is to keep pace with a December 2020 European Union agreement that calls for cutting the trading bloc’s emissions by 55 percent by 2030, a big increase from the previous target of 40 percent.[5]

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Merkel helped broker that international agreement, but she won’t be responsible for undertaking most of the work required. She’s stepping down this year prior to new federal elections. It’s likely that debates about how to reach climate targets, including questions about the coal timetable, will be a major campaign issue.

The extent to which renewables can be further ramped up will matter a lot. Engineers have projected that more than 1,000 kilometers of new transmission lines are still needed to efficiently move renewably generated electricity. That’s politically unpopular in a country with a long tradition of citizen protest against nuclear plants, fracking, and other forms of industrial development.

Spreading the pain, and the benefits

The biggest of Germany’s emissions challenges may lie closer to home, for the electricity sector is only one of many sources of greenhouse gases. Germany’s transportation sector produces practically the same amount of emissions[6] as it did 30 years ago, and its powerful auto companies resisted emissions regulations for years,[7] often with Merkel’s support.

But here too new regulations and competition may finally instill some change. Guidelines agreed upon by the European Union in late 2018 require carmakers to reduce emissions from their fleets. And in 2019 the federal government agreed on a new Climate Action Program that sets policies for meeting the country’s 2030 emissions targets.

If previous Energiewende plans focused in large part on building out renewables and reducing emissions from the biggest sources, like power plants, the new regulations take a much broader approach that spreads out both the pain and the benefits. The centerpiece so far is a steadily rising carbon tax imposed on fossil fuel users, including consumers. That means higher fuel prices for drivers and homeowners.

But those impacts are to be offset by reductions in utility consumers’ renewable energy fees, as well as other incentives. Those include cuts in ticket prices for train travel, incentives for building renovations and purchases of electric cars, and a massive program to install electric chargers at gas stations. Plans also call for major efforts at improving battery storage systems and hydrogen fuels.

The new carbon fees on fuels just went into effect in January, so it’s too early to get a sense of their public reception. But there are indications that broad buy-in is a real and continuing possibility. Germans have taken note[8] of trees dying of drought and of unprecedented heat waves[9] that have struck the country in recent summers. The youth “Fridays for Future” demonstrations initiated in Sweden by Greta Thunberg have seen a lot of participation and support. Continuing public backing for Energiewende policies, even ones with an economic pinch, seems a real possibility.

Some citizen pressure may well come in the form of pressuring officials to speed up, rather than slow down. A lot depends on which parties and candidates do well in this year’s elections, which will culminate in the first new chancellor since Merkel stepped into that role in 2005.

If Agora Energiewende has its way, in line with other environmental advocates, the new government will pursue both a faster exit from coal and a targeted buildup of nationwide electrification and innovation on par with the Wirtschaftswunder. The group’s director, Patrick Graichen, has called for “a comprehensive investment and future-proofing program for Germany, comparable to the economic miracle of the 1950s and 1960s.”

Whether that level of investment gains public and political support is an open question; it may depend on how quickly climate change impacts multiply. As is the case with World Cup soccer, forecasts are dicey—but it is likely that in both international soccer and climate change action Germany will remain one of the world’s leaders.

[1] See https://www.agora-energiewende.de/en/press/press-releases/corona-year-2020-record-declines-in-carbon-emissions-and-coal-power/

[2] See https://insideclimatenews.org/news/13112012/germany-energiewende-clean-energy-economy-renewables-solar-wind-biomass-nuclear-renewable-energy-transformation/

[3] See https://insideclimatenews.org/news/01102013/ww-ii-era-law-keeps-germany-hooked-brown-coal-despite-renewables-shift/

[4] See https://insideclimatenews.org/news/15102020/germany-coal-transition/

[5] See https://www.nytimes.com/2020/12/11/world/europe/eu-climate-emissions.html

[6] See https://www.cleanenergywire.org/news/renewables-produce-more-power-fossil-fuels-germany-first-time

[7] See https://insideclimatenews.org/news/11062020/germany-transportation-auto-industry-volkswagen-tesla-clean-energy/

[8] See https://www.spiegel.de/wissenschaft/natur/waldsterben-in-deutschland-foerster-warnen-vor-klimakrise-a-1279002.html

[9] See https://www.faz.net/aktuell/gesellschaft/deutscher-wetterdienst-annulliert-temperaturrekord-17106796.html

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