Germany’s “green revolution,” or energiewende, was supposed to be a proof-of-concept for renewable energy policy. The green movement, for its part, holds Germany up as a successful example of how much can be accomplished—how many gigawatts of solar and wind energy capacity can be installed—if governments just ditch dirty fossil fuels and get on the zero-emissions bandwagon.
Unsurprisingly, reality is proving to be more complicated than the green policymakers anticipated. Given current technologies, wind and solar are more expensive energy sources than coal, oil or gas. Germany is propping up renewables with feed-in tariffs, but the costs of this plan are mounting, and Germany’s households and its industry that are footing the bill. Reuters reports:
So attractive are the [Germany's green energy incentives], or feed-in tariffs, that the rapid expansion of renewable power has driven up the surcharges which fund them and are paid for by consumers. The charge rose by 47 percent this year alone. [...]
Export-oriented German industry, already disappointed that shale gas is being shunned due to environmental fears, is angry about high energy costs, although exemptions help many firms in the cement, steel, paper and glass sectors. [...]
“Energy-intensive industry, which employs over 900,000 people, will have to leave Germany in the medium term if it does not get sustainably competitive energy prices,” said the head of the BDI industry association last month.
This is what happens when you let pie-in-the-sky dreams dictate policy. We can all agree that it would be wonderful if we figured out a way to cheaply and efficiently harness the sun’s power with solar panels and wind turbines. But we’re not there yet, and government subsidies won’t change that (though government grants to research and development might). Germany has to come to terms with the fact that it made a wrong turn with its energiewende. Expect that reckoning to come sooner rather than later.
[Angela Merkel image courtesy of the European People's Party]