Progressing towards Green energy in Germany

Something to be learned here!

According to Federal Audit Office data, the Energiewende has cost around 34 billion euros in 2017 alone. In addition to the federal government’s expenditure of almost 8 billion euros, this also includes the burdens on end consumers, in particular due to the renewable energy levy (EEG). “The Federal Government, incidentally, does not have an overall grasp of the costs or any transparency in this respect.”

The wastage of resources to implement the Energiewende was “unprecedented”. Last year, the federal ministries and subordinate authorities employed around 675 full-time staff, 300 of them in the Federal Ministry of Economics alone, divided into 34 departments and four divisions. In addition, there are at least 45 committees at federal-state level dealing with the green energy transition. The effort being expended here is in itself almost contradictory to one of the main objectives of the energy system transformation: the economical and efficient use of scarce resources.

“The scope of the legislation is also striking,” Scheller stated: “At national level alone, 26 laws and 33 regulations regulate the generation, storage, transmission, distribution and consumption of energy. There is, however, “no place where everything comes together, no place that assumes overall responsibility”, Scheller criticised.

In short: “A lot of effort does not necessarily mean a lot”. For despite a great frenzy of data collection there is no overall view. “The Federal Ministry of Economics uses 48 different data sources to check the status of the Energiewende on the basis of 72 indicators, and yet “there is a lack of meaningful data that could be relevant for assessment and control”. Many data would have little control value or would be available too late, but often they would “simply draw the wrong conclusions”.

Well nobody ever said that saving the planet would be easy.

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19 Responses to Progressing towards Green energy in Germany

  1. Crossie

    Many data would have little control value or would be available too late, but often they would “simply draw the wrong conclusions”.

    Why not just say too little, too late?

    Saving the planet means employing an awful lot of luvvies.

  2. Bad Samaritan

    We went through all this a few weeks back…..

    I go to Germany on a semi-regular basis and have plenty of friends (Germans and French mainly) living there. A couple of them have mid-sized businesses with over a hundred employees…

    I see no sign of distress nor imminent collapse, nor of poverty, nor of any real economic, nor social, malaise despite all this very obvious waste of resources on renewables. It all appears to me to just be an affluent people indulging their whims…….something like the average Joe “squandering” money at the pub for $5 schooners when he could be getting the same beers for a buck a can at the local bottle shop.
    Those who know “the cost of everything but the value of nothing” (me!)may see it all as a misallocation of scarce resources. But, again, just as I could get to point B from point A much cheaper by bus, I do prefer to misallocate my financial resources by taking the Bugatti instead.

    Can someone point out how they reckon the German economy has been (severely?) damaged by all this crap spending on wind and solar? Not some glib “We’ll see one day” stuff, but a real example so I won’t appear to be another Chicken Little or Boy Who Cried Wolf next time I tell my mates over there that they’ve got it all wrong. Even as their profitable businesses show no sign of stress. Cheers.

    BTW: Someone paying three times the price for one bottle of plonk compared to another (when the former gets 90 points in a blind taste-testing, and the latter 95) is harmful, or “bad” in what way?

  3. a happy little debunker

    Can someone point out …

    Aside from Germany’s dependence on Russian Gas and the implications this has for NATO – there are significant issues with domestic energy poverty (usually considered a 3rd world issue) detailed here.

  4. min

    As part of organised tour in Germany in May ,we had afternoon tea with locals at Speyer on the Rhine.
    Greenies, The wife from the Caribbean busily converting Muslim refugees to Christianity. No she did not know what apostasy is. However energy prices are huge but all would be fixed with more renewables. This when Turbines falling to pieces ,nowhere to put old solar panels and jobs going because subsidies were being removed . Brainwashed people everywhere,he was a tree plantation manager so at least he had access to firewood.

  5. AlanR

    Those who know “the cost of everything but the value of nothing”. My favourite quote to describe economists.

  6. RobK

    handelsblatt.com/energy-bill-power-price-hikes-shock-germanys-mittelstand/23582558.html

    27.06.2018 | 18:00 Uhr

    ENERGY BILL
    Power price hikes shock Germany’s Mittelstand
    von Jürgen Flauger
    Electricity prices have doubled over the last 18 months. That’s bad news for Germany’s Mittelstand sector, which hasn’t done enough to hedge itself.

    Power prices are increasing, and that’s turning into a problem for Germany’s huge Mittelstand sector of small and medium-sized companies, many of whom haven’t hedged themselves with futures contracts.

    A megawatt hour is currently trading at just over €40 ($46.70) on the futures market of the Leipzig Energy Exchange EEX, well up from below €20 at its lowest point in February 2016 and following sharp rises in world prices for oil, coal and gas.

    Big companies had locked in low prices for a number of years with futures contracts but many of those contracts are due to expire next year or in 2020 — and scores of Mittelstand firms are now facing the full brunt of the price hikes.

    “I’m getting queries from a lot of companies whose contracts expire next year and who are shocked by their future energy bills,” said Wolfgang Hahn, director of Energie Consulting GmbH (ECG), which advises firms on their power purchases.

    One metalworking company in the western industrial state of North Rhine-Westphalia secured a price of €20-25 per megawatt hour until 2019 and will have to pay over €40 with its next contract. That will increase its annual power bill by almost €100,000. This is a major burden given that its earnings are already under pressure from a decline in demand for the wind turbines it manufactures.

    “Electricity prices have doubled over the last two years,” Mr. Hahn said. “It’s very painful for a lot of our customers.” Large companies are best-equipped to cope because they can afford energy procurement departments that know their way around the futures market. But even they aren’t always fully hedged.

    “I have customers that locked in the low prices until 2021 or even 2022,” Mr. Hahn said. “But even well-versed electricity customers have to purchase additional tranches now.” Firms tend to be tight-lipped about their energy costs because they don’t want to give their rivals inside information.

    Power is a particularly big cost factor in industries like steel, aluminum and chemicals. It accounts for around a third of the production costs of chlorine, which is used in nearly 70 percent of all chemical products. Covestro, a listed chemicals group based in Leverkusen, complained that power prices in Germany are not predictable enough and that its power costs were far higher at home than at its US plant in Baytown, a city near Houston, Texas.

    Market speculation
    Power traders said the surge in wholesale power prices has been so strong recently that it can’t just be blamed on fuel price increases — speculators have also played a part. “In the last 10 weeks alone the future for 2019 has increased by €7,” said one trader, adding that the rise wasn’t justified by fundamentals. “Many hedge funds have come into the market recently and they’ve been driving up prices.”

    Experts say there’s little prospect of a change in the upward trend. “Even at current prices I’m advising my customers to lock in big tranches long-term to 2021, 22 or even 23,” Mr. Hahn said. Though prices have doubled, they’re still modest in a long-term comparison and well below the peak of over €90 reached a decade ago. “There are no signs that power prices will fall again. On the contrary, there’s a high probability that they’ll keep on rising,” he said.

    He makes a valid point. The chief financial officer of energy giant RWE, Markus Krebber, told Bloomberg this month that the German government plans to shut down the most heavily polluting coal-fired power stations on top of the phase-out of nuclear plants would force utilities to plug the gap with renewable power, which is more expensive.

    Jürgen Flauger covers energy for Handelsblatt. To contact the author: [email protected].

  7. max

    Standard socialist baloney:

    I’m from the government and I’m here to help.”

    Believe in central planning and central planners.


    I am here to save children, poor, planet……
    In the name of saving this or that give me more power and money…

    I am going to protect you from bad immigrants, protect your jobs from cheap foreigners, save planet from pollution, protect you from evil capitalist .. and on and on

    Just give me more money and power — I am superman and God

  8. .

    AlanR
    #2878946, posted on December 5, 2018 at 9:46 am

    Those who know “the cost of everything but the value of nothing”. My favourite quote to describe economists.

    Huh? Can explain why? Wasn’t it an economist that came up with the idea of subjective marginal utility being the basis of value?

    Seems like you’re talking about accountants.

  9. max

    “Wasn’t it an economist that came up with the idea of subjective marginal utility being the basis of value?”

    how much do you value air today, now?
    what if you go to the moon?

  10. Tel

    One metalworking company in the western industrial state of North Rhine-Westphalia secured a price of €20-25 per megawatt hour until 2019 and will have to pay over €40 with its next contract. That will increase its annual power bill by almost €100,000. This is a major burden given that its earnings are already under pressure from a decline in demand for the wind turbines it manufactures.

    Take note, AFTER the price increase they are paying about 6.2c per kWh (in Australian dollars) which many Australians businesses would be very, very happy with. Most Australians pay at least triple that.

  11. .

    That’s right max. What value is a cave full of diamonds if you have zero water soures? Thus, the benefits and tendency/necessity to trade arises; also private property rights.

  12. max

    “What value is a cave full of diamonds if you have zero water soures? Thus, the benefits and tendency/necessity to trade arises; also private property rights.”

    yes

    if you are alone on the island everything is yours, but if there is more of us, if we want to avoid conflict, better establish what belong to who — property rights –than trade,barter, than money.

  13. RobK

    Tel,
    http://www.energyaction.com.au/energy-procurement/aex-reverse-auction/energy-action-price-index

    prices last month?

     

    In the Australian energy market, the forward price of electricity for medium to large users fluctuates from day-to-day. Energy Action’s Price Index (Business) (EAPI) provides clarity to the market encompassing pricing from energy retailers via the Australian Energy Exchange (AEX).

    EAPI represents the average commodity price of retail electricity paid by Australian businesses based on a Standard Retail Contract (commences in 6-months and operates for 2½ years). EAPI is created from the lowest cost offers submitted by retailers via the AEX and reflects the cost of commodity electricity to commercial and industrial customers.

    For more information about the Energy Action Price Index, read our Frequently Asked Questions (FAQs).

    Energy Action has redefined the EAPI for South Australia. From 2 February 2016 onwards the Standard Retail Contract for South Australia commences in 2-months and operates for 1 year. This change has been made to better reflect market conditions in South Australia where contract lengths have shortened considerably since late 2015. This change to the EAPI is limited only to the index for South Australia. Standard Retail Contract definition for all other states remains unchanged.

    200720082009201020112012201320142015201620172018Drag here to set date rangec/kWhNSW

    And…

    October to Mid November Retail prices continued to tick up over the period with the index for NSW gaining 0.25c/kWh to close at 8.60c/kWh and with Victoria gaining a similar amount to close at 8.70c/kWh. The indexes for Queensland and South Australia also gained 0.2c/kWh and 0.4c/kWh respectively.On the futures market prices also increased for calendar 2019 and calendar 2020 contracts across all states. As has been the case for many  months, the principal concern is with potential electricity supply shortfalls, possible generation reductions at Snowy Hydro and the continuously elevated price of gas all acting to push up prices for the hot season of Q1 2019.

    Whilst discounts for longer term deals remain at typically <0.4c/kWh for 3 year terms versus 2 year terms, the price for both shorter and longer term contract has increased moderately over the period.

     

    With COAG having deferred any potential decision on both reliability guarantees and renewables  targets until December the ongoing uncertainty over energy policy is set to continue. 

  14. AlanR

    Nope – the accountant gave that game away to become a statistician. He found accounting far too exciting.

  15. Rafe Champion

    Electricity prices have doubled over the last 18 months. That’s bad news for Germany’s Mittelstand sector, which hasn’t done enough to hedge itself.

    Big companies had locked in low prices for a number of years with futures contracts but many of those contracts are due to expire next year or in 2020 — and scores of Mittelstand firms are now facing the full brunt of the price hikes.

    “I’m getting queries from a lot of companies whose contracts expire next year and who are shocked by their future energy bills,” said Wolfgang Hahn, director of Energie Consulting GmbH (ECG), which advises firms on their power purchases.

    Power is a particularly big cost factor in industries like steel, aluminum and chemicals. It accounts for around a third of the production costs of chlorine, which is used in nearly 70 percent of all chemical products. Covestro, a listed chemicals group based in Leverkusen, complained that power prices in Germany are not predictable enough and that its power costs were far higher at home than at its US plant in Baytown, a city near Houston, Texas.

    Fancy that! Who would have thunk?

  16. RobK

    Fancy that! Who would have thunk?
    And as Tel points out their new price is about 6.2c a unit, whereas we are at around 8.7c. Very competitive-not.

  17. Dr Fred Lenin

    We should be proud we have the biggest coal and uranium deposits in the world and the dearest electricity ? However \we supply coal to China. japan and India so their people can have electricity much cheaper than ours ,and manufacture cheaper goods which destroy jobs in our country. Theres no doubt about it we have the smartest politicians in the world ,just ask them and their media mates ,we are so lucky to have our country run by orefernced tosser who get in by default ,wankers .

  18. Genghis

    So turn on the eleven Nuclear Reactors and reduce CO2 at a fraction of the cost.

  19. Squirrel

    “The Federal Government, incidentally, does not have an overall grasp of the costs or any transparency in this respect.”

    A sobering observation as we head down the same path, given that ‘Strayans are (unlike the Germans) not noted for a methodical attention to detail – particularly when that detail relates to spending other people’s money on things that make (some of) us feel good about ourselves.

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