威力彩玩法

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22 Dec 2017, 00:00
Benjamin Wehrmann

Preview2018 - Next German government faces urgent coal choice

After a year filled with events that put Germany鈥檚 climate policy in the limelight, such as the G20 summit in Hamburg, the COP23 in Bonn, or the debate over coal in the ill-fated 鈥楯amaica coalition鈥 talks, the country鈥檚 political life gets off to a faltering start in 2018. Germany faces unprecedented difficulties in forming a new government, a situation that has an impact on all policy areas 鈥 with energy and climate policy being no exception. The next government will be faced with numerous challenges to make progress on Germany鈥檚 Energiewende and climate protection, with an important intermediate target for emissions reduction by the end 2020 merely three years away. The future role of coal in Germany will be crucial in this context, but the new government will also have to deal with a growing debate over the funding of renewables, the question over diesel engines and looming driving bans.

Government formation

September鈥檚 elections delivered a blow to the incumbent grand coalition of Germany's two biggest parties. Chancellor Angela Merkel鈥檚 conservative CDU/CSU alliance and the Social Democrats (SPD) both suffered heavy losses at the ballot box and the ensuing difficulties in government formation are unprecedented in the country.

After the Jamaica talks between the conservatives, the pro-business FDP, and the environmentalist Green Party collapsed in late November, the country is headed for another grand coalition 鈥 although for now the SPD remains reluctant to enter into a constellation that it says was voted out in September. It therefore mulls either tolerating a conservative minority government, experimenting with a non-binding form of cooperation with the conservatives, or even agreeing to hold new elections.

In any case, the current government gridlock is likely to persist for another few months, and a new government will probably not be formed before spring. While this uncertain situation falls short of constituting a political crisis in a country with strong federal states and robust constitutional procedures that serve as guidelines during such a stalemate, it casts a shadow over all of Germany鈥檚 major policy endeavours, as most decisions with long-term implications will lay idle before a new government enters office.

鈥淭he most important issue will be who is going to form Germany鈥檚 new government and what its energy policy is going to look like,鈥 says Tina L枚ffelsend of the environmental organisation Friends of the Earth Germany (BUND). She argues that it depends on the next government鈥檚 ambitions whether the country will stagnate or make progress on climate and energy policy matters, such as phasing out coal-fired power production or lifting the cap on expanding renewable energy sources.

In the run-up to September鈥檚 elections, the 威力彩玩法 asked German energy and climate stakeholders about their hopes for the next government. Their answers, ranging from 鈥渁 fundamental reform of the Renewable Energy Act鈥 to 鈥渁 long-term framework for the country鈥檚 energy efficiency policy鈥 or an 鈥渁mbitious CO鈧 pricing with a national floor price鈥 hint at the scope of challenges any new administration will be facing.

COP24, digitalisation, state elections and everything else...

Apart from several key policy areas discussed below, 2018 will be filled with a multitude of other major and minor developments and events that also will shape the course of Germany鈥檚 Energiewende. This includes the growing importance of digitalisation and technologies such as blockchain for the future course of a smart and decentralised energy system; the UN climate conference COP24 in Poland; state elections in two of Germany鈥檚 economic powerhouse regions, Hesse and Bavaria; the end of hard coal mining in Germany; the debate over the controversial natural gas pipeline Nord Stream 2;聽 the ongoing phase-out of nuclear power; and the search for a final nuclear waste repository.

2020 climate target

The fact that Germany is headed for missing its self-imposed 2020 emissions reduction target adds further urgency to resolving the governmental standoff, L枚ffelsend says. 鈥淲hat counts in the end is that Germany achieves this target,鈥 she says. 鈥淏ecause otherwise all of its subsequent targets could no longer be met.鈥

In contrast, Sebastian Bolay from the German Association of Chambers of Commerce and Industry (DIHK) says a hasty coal exit would push up power prices and might endanger supply security, thus undermining German industry鈥檚 competitiveness. 鈥淭o reach the targets set for 2030 and beyond, it is much more urgent for us to cut emissions in the transport and heating sectors,鈥 Bolay argues.

Germany has pledged to reduce its greenhouse gas emission by 40 percent by 2020 compared to 1990 levels. This happened in conjunction with the EU鈥檚 contribution to reaching the Paris Climate Agreement鈥檚 goal to largely decarbonise the world鈥檚 economy by the middle of the century. But, according to Germany鈥檚 environment ministry (BMUB), emissions reduction will rather end up below 33 percent if no additional measures are taken.

If the country fails to fulfil its own climate ambitions, this would cost its political credibility and economy dearly, energy economist Claudia Kemfert says. 鈥淭he longer climate protection is postponed, the higher the economic costs and disadvantages for the whole economy will be,鈥 Kemfert argues, adding that initiating a coal exit soon was the only way to avert a climate policy disgrace.

Michael Sch盲fer of the environmental organisation WWF says that phasing out coal is crucial for reaching the 2020 goal, but adds that an overall 鈥emergency programme for our climate policy鈥 is needed to make meaningful progress. He says other measures, for example tax credits on retrofits of polluting cars, energy efficiency regulations for buildings, and a transition towards electric mobility, also have to be introduced quickly to stay on track for the next target year and the following goal in 2030.

However, other climate policy observers, such as economist Andreas L枚schel, who heads the advisory board authoring the German government鈥檚 energy transition monitoring report, suggest that more calmness with respect to 2020 is advisable. 鈥淲e wouldn鈥檛 really need to be right on target for the 2020 goal, if there were signals that we鈥檙e on the right path for the long-term goals,鈥 he says.

Coal exit

L枚schel argues that the debate over how many gigawatts (GW) of coal capacity can be taken off the grid focused too much on the short run. In the failed Jamaica talks, the conservatives and the FDP proposed to retire up to 5 GW, while the Green Party called for 8-10 GW. A compromise between the parties envisaged the decommissioning of 7 GW by 2020, the equivalent of Germany鈥檚 15 most carbon-intensive coal plants.

The talks鈥 collapse ultimately scrapped this agreement, but in a surprise move, the SPD, which traditionally has close links with the coal industry, has recently announced that reaching the climate targets would have to go 鈥渉and in hand with an end to coal-fired power generation.鈥 SPD head Martin Schulz insisted that this cannot be achieved 鈥渇rom one day to the next,鈥 and protecting coal workers鈥 economic interests had to be paramount for a just transition. The future of coal-fired power production is now also likely to figure prominently in potential coalition talks between the Social Democrats and the conservatives. Also, the coal exit commission proposed in the Climate Action Plan 2050 might start its work in 2018, environment minister Barbara Hendricks said.听

The share of coal in Germany鈥檚 power generation already fell from over 40 percent in 2016 to 37 percent in 2017, and this trend is almost certain to continue over the next years, the head of Germany鈥檚 largest utility association BDEW, Stefan Kapferer, argues. He says a market-driven coal exit in Germany has long begun, irrespective of political decisions. 鈥淭he reduction of coal-fired power production is in full swing,鈥 he says. The BDEW estimates that Germany鈥檚 installed coal capacity could fall from the to about 20 GW by 2030, which would help the country meet its climate targets without compromising on supply security.

However, the recent drop in coal鈥檚 share has yet to bring about a reduction in emissions. According to forecasts by the energy market group AG Energiebilanzen, energy-related emissions stagnated in 2017. But Kapferer says the growing share of renewables in Germany鈥檚 power production ensures that the country鈥檚 power sector is well on its way to meet its sectoral contribution to the 2020 goal. The main culprit for lacking overall progress was the transport sector, which 鈥渟o far hasn鈥檛 made adequate contributions鈥 to reducing CO2 emissions.

Transport

Emissions in Germany鈥檚 transport sector have barely decreased, if at all, since 1990 as higher traffic volumes set off efficiency gains for individual vehicles. Moreover, in year three after the ongoing dieselgate scandal broke in September 2015, the share of diesel cars among new registrations is falling, but sales of diesel fuel have risen to record levels in Germany. At the same time, a lack of charging infrastructure and high prices continue to keep sales of electric vehicles at marginal levels, far below the trajectory needed to meet the official government goal of having one million e-cars and plug-in hybrid vehicles on the road by 2020.

Energy economist Kemfert says the government could intervene in 2018 by abolishing the favourable taxation of diesel cars, and at the same time introducing a quota for e-cars, ramping up investment in infrastructure, and promoting alternatives to individual motorised transport. 鈥淎 sustainable transformation of the transport sector is urgently needed,鈥 she says.

Matthias M眉ller, CEO of Germany鈥檚 largest carmaker VW, has recently stunned his company鈥檚 competitors by proposing an end to diesel tax breaks to facilitate the shift to e-cars. However, the transport ministry (BMVI) rejected the idea, arguing this would equal an 鈥渆xpropriation of millions of diesel car owners.鈥

But diesel car owners already face a more specific obstacle in early 2018. On 22 February, the Federal Administrative Court will deliver a verdict in a case that could ban diesel cars without modern emissions control systems from entering inner cities. The government announced it would invest around one billion euros into an ad hoc programme that includes a set of measures to avoid the ban.

An e-car quota has also been proposed by the government鈥檚 Advisory Council on the Environment (SRU), according to which at least 25 percent of new cars and light trucks should be pure electric by 2025. But Germany鈥檚 carmakers seek to avoid such an imposition by announcing ambitious plans to get electric car sales off the ground in 2018.

Renewables expansion

In contrast to the plans for e-mobility, the roll-out of renewable energy sources in Germany is running ahead of the government鈥檚 schedule. According to preliminary figures published by the BDEW, the country has already surpassed its 2020 goal of 35 percent renewables share in gross power consumption. BDEW head Kapferer says that wind turbines, solar PV panels, and other renewable sources 鈥渕ight well take the lead next year鈥 and become Germany鈥檚 most important power source ahead of coal in 2018.

Yet, Tina L枚ffelsend of the BUND worries that the current expansion rate of renewable sources may still fall short of satisfying the needs of an economy which is set to increasingly rely on electricity as its main form of energy. She says auctions for renewables and the cap on expansion volumes hinder Germany鈥檚 sector coupling, the emerging electrification of transport, heating, and industry processes.

鈥淪ector coupling is an aim that all parties subscribe to, even if they are not the most fervent defenders of the climate,鈥 she argues. An appropriate conclusion in this case would be to double auctioned volumes for wind and solar power. The auction mechanism itself would also have to be amended, as it currently produces 鈥渄isastrous鈥 results for wind power companies by accepting projects that may never be implemented due to lacking construction licenses. The wind power industry has warned that despite robust expansion prospects in 2018, an unchanged auction system might lead to a cliff in 2019.

Also, utility lobbyist Kapferer says that 鈥渁 rupture鈥 in expansion remains a possibility if the auction mechanism is not amended, adding that the government must add further auctions if the problem of lacking licenses persists. However, the BDEW head says that expanding Germany鈥檚 power grid is 鈥an absolute priority鈥 as it is essential for delivering additional renewable power from its source regions to industrial centres.

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