This article is part of an online series about the experiences of the Sustainable Economy Forum during their trip to Berlin, 4–8 November 2012.
An unprecedented and historical energy reform is taking place in Germany and it is called Energiewende. It has exceptionally wide social support in Germany. So how is this kind of ‘social contract’ possible?
“Wende refers to the fall of the Berlin wall. Energy reform is considered as great a chance in Germany,” says Petri Hakkarainen, who specialises in energy reform and works at the Institute for Advanced Sustainability Studies based in Potsdam.
The energy reform refers to the decision confirmed by the German government in 2011 to renounce all nuclear power before 2022 and to significantly increase the use of renewable energy to the point where it constitutes 80% of all energy provision by 2050.
The government’s decision has been a success. At the beginning of the millennium, an EEG law (Renewable Energy Sources Act) was introduced to provide for feed tariffs, which in ten years has tripled the share of renewable energy in the overall market. The EEG guaranteed a fixed price for producers selling renewable energy to the network for the next twenty years. In other words, it provided an incentive to produce renewable energy. In practice, the EEG fee is paid for by the consumers through their electricity bills.
But the history of Energiewende has not been without its difficulties. “Merkel’s government had already decided on extending the operating life of existing nuclear power plants before it reversed its decision overnight,” says Hakkarainen. The nuclear power plant accident in Fukushima, Japan, had an enormous effect on energy policy in Germany, where there is still a very sensitive attitude to nuclear energy.
The oldest nuclear power plants in the country were closed down immediately and the rest will be run down by the objective year 2022. At the same time, Germany confirmed its aim to reduce its greenhouse gas emissions by 2050 to a point 80 per cent below its 1990 level.
The long green history of Germany
“Energiewende is a change of momentous importance and it is backed by an exceptional consensus in Germany. For example, very few people have questioned giving up nuclear energy, only the timetable has been debated,” says Petri Hakkarainen. German consumers pay almost twice as much for their energy than their Finnish counterparts but they do not complain. What is behind the great support for Energiewende?
Germany has a long history of opposition to nuclear energy. During the Cold War a strong peace movement which opposed nuclear weapons was established in the country. The accident in the Chernobyl nuclear power plant had a deep effect on Germans even though the country was not among those worst afflicted by the fallout.
The accident contributed further to Germans’ negative attitudes towards nuclear power and increased their environmental awareness. As a result the support for the German Green Party increased permanently and blazed the trail for more environmentally conscious policies.
Eventually this support helped the party to enter government in 1998, which served as the final push for Energiewende. After the Chernobyl accident there has been no debate about building more nuclear power plants. According to Hakkarainen: “Germans consider Energiewende a joint effort that they wish to participate in.”
The EEG act with its high feed tariffs caused an influx of small producers in the energy markets and currently over half of the renewable energy in Germany is produced by individuals and cooperatives. Germans want to do their part for the environment, but small-scale production is also supported since it makes energy policies more democratic and increases the self-sufficiency of people.
In Germany, even industrial bodies are in favour of Energiewende. Strict laws on curbing air and water pollution introduced in the 1970s gave a boost to the development of cleaner technologies. Now the development of technology required by renewable energy is seen as a great business opportunity. In fact, it is estimated that green industry in Germany will double by 2025.
Future made in Germany
“Thus far the reform has surfed on the crest of a wave from Fukushima. But now contradictory voices are starting to be heard,” says Hakkarainen. The EEG fee will increase in Germany next year and the key debate, also in the future parliamentary elections, is whether the energy reform is too expensive for consumers. The distribution of Energiewende costs is being discussed since many energy-intensive industries have been exempt from the fee.
Another challenge is updating the electricity distribution network to support fragmented production. Electricity transmission capacity has to be increased significantly so that the industry clusters in southern Germany will receive electricity reliably from the windy north. The energy reform is just getting started, as half of energy produced in Germany is coal-fuelled.
Germany has challenges to solve in its energy reform. However, it is perceived to have enormous potential. The reform is a robust means to curb climate change and promote environmental sustainability. It is estimated that over 380,000 people work with renewable energies in Germany.
The global esteem of the country is also growing: Germany is becoming a clear leader in internationally growing energy and environmental technology markets. If the world’s fourth largest economy succeeds in unlinking emissions and economic growth, others will likely follow suit. As the slogan for energy reform says: “Future made in Germany.”
See Petri Hakkarainen’s presentation about Energiewende